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Trump Threatens to Close Border; White House Blames Pelosi; Shutdown Enters Day Seven; Muller Collected Nude Selfie; House Democrats Gear up for Investigations; Kurds Turn to Assad. Aired 1- 1:30p ET

Aired December 28, 2018 - 13:00   ET

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

(COMMERCIAL BREAK)

[13:00:06] DANA BASH, CNN ANCHOR: Hey, everybody, I'm Dana Bash, in for Brianna Keilar.

And we start with the new year fast approaching and still no sign of a deal to end the government shutdown. It's been almost a week now and today we do have a new threat from the president. Here's what he tweeted. We will be forced to close the southern border entirely if obstructionist Democrats do not give us the money to finish the wall and also change the ridiculous immigration laws that our country is saddled with.

I want to get straight to CNN White House reporter Sarah Westwood at the White House.

First let's start with that threat. Is that an actual threat or meaning like do you think that there could be policy change or is this the president spouting off with no real policy change coming in the future?

SARAH WESTWOOD, CNN WHITE HOUSE REPORTER: Well, Dana, President Trump has threatened before to shut down the southern border when his immigration agenda has hit a stall. He's also before threatened to cut off aid to Central American countries whose people are traveling into the U.S. illegally. Neither of those things have really been followed through on by this administration yet.

But the White House is starting to show some signs of backing down off that demand for $5 billion in border wall funding. Recall that Vice President Mike Pence offered something in the neighborhood of $2.5 billion on Saturday during a meeting with Senate Minority Leader Chuck Schumer. That was CNN's reporting. Mulvaney confirming it this morning. But the Democrats rejected that offer. So talks do appear to still be at the standstill.

And the White House is pointing fingers increasingly at House Minority Leader Nancy Pelosi, accusing her of being limited in her ability to deal with the administration versus Senate Minority Leader Chuck Schumer, who they say is more willing to make a deal.

And this morning incoming acting chief of staff/budget director, Mick Mulvaney, suggested that Pelosi could be in danger of losing her bid for the Democratic House speakership if she were to accept a compromise before January 3rd. Take a listen.

(BEGIN VIDEO CLIP)

MICK MULVANEY, INCOMING ACTING WHITE HOUSE CHIEF OF STAFF: This all comes down to Mrs. Pelosi's speakership. I think left to his own devices, that Chuck Schumer and the Senate Democrats probably would cut a deal, but they're protecting Mrs. Pelosi. She does not have the votes. And if she cuts a deal with the president, of any sort, before her election on January 3rd, she's at risk of losing her speakership. So we're in this for the long haul.

(END VIDEO CLIP)

Now recall that (INAUDIBLE) on Wednesday the president said that Pelosi is the one at this point calling the shots. So the White House is buckling down for what could be a long shutdown that stretches into the new year. Mulvaney also said the White House has not invited Democratic leaders back for further negotiations. So, Dana, it appears the White House is just waiting for a counteroffer from the Democrats at this point.

BASH: It certainly does.

I want to also ask you about another tweet from the president today. He's starting to talk again about a new caravan. We know from the midterms this is his go to when he wants to rally the base, you know, in a very blatantly political way. He stopped talking about any potential caravan after the midterms were over. Now he clearly wants his base to be behind him and he's starting to talk about it again. Do we have any evidence that there actually is a caravan forming in any of these south or Central American countries as he is suggesting?

WESTWOOD: Well, we don't, Dana. It appears that the president of Honduras did mention that a caravan could be headed for the U.S. or headed north at least in January, but we don't have evidence that that caravan has formed yet, has departed yet.

And recall that the last time the president uses a caravan of Central American migrants to his advantage, he frequently misled about the size of that caravan, the makeup. He frequently claimed incorrectly, for example, that it was made up of criminals mostly when, in fact, there were a large number of women and children, families in the caravan. So this is a tactic that he's turned to before when he's been pushed against the wall, politically speaking. And, of course, he hopes that perhaps the negotiations for funding for the wall could take place against the backdrop of another caravan heading to the southern border, Dana. But it's not clear if that will be the case.

BASH: No, not clear in the least. Sarah, thank you so much for that reporting and that context of what we're hearing from the president this morning.

So, as we mentioned, it's been a week since the government has been partially shut down. Congress is not there. There is no deal expected soon.

I want to get straight to CNN's congressional correspondent, Phil Mattingly, on Capitol Hill.

Phil, if there was any discussion going on at all that is real, I am confident you would know about it. But it sounds as though you can hear a pin drop in those Capitol Hill halls there.

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Yes, it's pretty lonely up here. It's pretty much just reporters. No lawmakers at all. And, Dana, you would know too if there were discussions going on right now, and there simply aren't. and the reality is that everybody's accepted the fact that there's not going to be a deal before the end of the year and likely the next time we're going to see any type of legislative movement will be when Democrats retake the House majority on January 3rd.

Nancy Pelosi, the speaker designate, expected to become the speaker, has made clear, she will move very quickly. And what Democrats are mulling in the House right now are really three options to send to the Senate to try and reopen the government. One would be the same exact stop gap bill the Senate passed unanimously that was eventually rejected by President Trump. That would reopen the government for the 25 percent currently closed until February 8th.

[13:05:14] Another option that has been put on the table for -- by Democrats for negotiations up to this point is to keep funding levels for the departments that are closed the same through the fiscal year. So basically re-open the government until the end of September but not change the funding levels from fiscal 2018 levels.

A third which is being considered is potentially packaging six of the seven appropriations bills in full together and then decoupling them, if you will, from the Homeland Security Department bill, which has the wall funding, is really kind of the central piece of the fight right now, and then sending those over to the Senate.

The big issue, though, Dana, and you know this as well as anybody, is Senate Republicans feel burned by what happened last week when the president decided to go against what they thought he was going to sign and they are very unlikely to move forward on anything until the president makes clear he's not going to veto it. So while the House can move and will move quickly, that doesn't necessarily portend an end game, it just portends the next step in a fight that at this point no one's really sure is going to end.

BASH: That's right. And it's not going to end any time soon and we're not just talking about political gainsmanship, we're talking about a real world impact. Tell me about that.

MATTINGLY: Yes, that's exactly right. I think one of the interesting moments about this is kind of this bizarre scene where nobody's here on The Hill, nobody's shuffling back and forth between meetings. And when you talk to people who are involved in this process or have been involved in these in the past, they recognize that because of the holidays, because of the timing, that the bite of the shutdown hasn't necessarily kicked in yet, but it's going to.

What we're going to see is the 800,000 federal workers that are either furloughed or considered essential and are working without pay, their first paychecks that will be affected, that will happen on January 11th. Some that started work the Saturday after the shutdown will see less money in their paychecks starting today.

You also have one issue that I'm told to pay a lot of attention to, the National Flood Insurance Program is not re-issuing or issuing any new policies because FEMA is shut down. That's a big problem for home buyers in states like Louisiana and Florida. You have the U.S. Coast Guard, Dana, a lot of people pointing to the fact the Pentagon is funded. The U.S. Coast Guard is under the Homeland Security Department. That's 40,000 plus people who are working without pay right now. Those things are going to become very apparent. That bite is really going to start to take place in the next couple of days. And that, more often than not, is when lawmakers start to react, when their constituents call them and say, I'm not getting paychecks, I'm not getting paid, and we have real problems.

BASH: That's right. And it's so important to note that it's not just here in the D.C. metropolitan area --

MATTINGLY: Right.

BASH: Where federal workers or people who are affected live. They are constituents of lawmakers all across the country.

Phil Mattingly, thank you so much for that.

I spoke to Republican Congressman Mark Meadows about the shutdown. Meadows is the chairman of the House Freedom Caucus, the group that helped convince President Trump not to fold on his demands for border wall funding. Here's what Meadows said about any potential compromise.

(BEGIN VIDEO CLIP)

REP. MARK MEADOWS (R), CHAIRMAN, FREEDOM CAUCUS: You know, at some point you have to understand that part of our immigration problem has to be addressing border security.

BASH: You're blaming Chuck Schumer here. You did it on Twitter earlier. But the Senate passed a funding bill. It was the House --

MEADOWS: Well, with no money for the wall.

BASH: It was the House --

MEADOWS: Yes, but no money for the wall, Dana. And let me just tell you, I mean, it may be different in New York, but I can tell you, the vast majority of Americans believe that a secure border and a secure community is something that is important to them.

BASH: This is by definition how a standoff happens. You say they're entrenched and they see you as entrenched.

MEADOWS: Right.

BASH: So, since I'm here talking to you, what are you willing to give up?

MEADOWS: I'm telling you, there's -- there's a compromise between 1.6 --

BASH: And what is it?

MEADOWS: You know, obviously as we --

BASH: But I'm saying, to get that money, for the Democrats to give in on that money, what are you willing to give the Democrats?

MEADOWS: Well, 5.7 was a compromise. You mentioned $25 billion for the wall. $5.7 is just a down payment for that.

But as we're looking at that, there's been a number of options that have been floated. You know, obviously, we can continue -- we've made an offer to $5.7 billion. We passed that out of the House. Nancy Pelosi said there wasn't the votes. Indeed there were the votes in the House to do that.

So here's what we have to do. At some point, Chuck Schumer and Nancy Pelosi and those that work closely with them have to come up with a counter proposal or not.

(END VIDEO CLIP)

BASH: With us to discuss, "Politico" White House reporter Gabrielle Orr, CNN's senior justice correspondent Evan Perez, and political congressional reporter and CNN political analyst Rachael Bade.

Happy Friday, everybody.

RACHAEL BADE, CNN POLITICAL ANALYST: Happy Friday.

BASH: So, Rachael, I just found it fascinating hearing Mark Meadows, who I spoke to him yesterday afternoon, blaming Chuck Schumer. Then you heard the incoming chief of staff, Mick Mulvaney, today, really putting the onerous on Chuck Schumer, saying, well, he would do it but he doesn't want to burn Nancy Pelosi. It almost seems as though he's trying to take -- you know, take a poke at Chuck Schumer's manhood there. So they're trying to divide the Democrats.

BADE: Right. Right. And I think that, you know, that's the strategy right now is to try to shift the blame, obviously, right? They are clearly having trouble right now in terms of messaging. When it comes to the leverage, the Democrats feel they obviously have the upper hand here. It was the president who just two weeks ago said he owned the shutdown. Now he's trying to pin the blame on them, trying to divide them.

[13:10:12] But we've seen this before, right? We've seen this story before. Whenever a party is making a demand in a shutdown fight, usually that party loses. And that's what we saw with the Democrats last year when they made the demand for dreamers to try to get a dreamer fix, a DACA fix, they didn't get anything and they ended up folding in the end. And so I think Democrats, going into this fight and for the next few weeks, they feel like they don't need to give the president and Republican any more money. I think it's interesting that you see Mulvaney out there saying, look, we're willing to compromise. We don't need $5 billion. We can take a smaller number. But for Democrats right now, there's just no incentive to give them that because the public -- the wall is already unpopular. Polls are already showing that they're blaming Republicans. And, you know, there just is no incentive for them to give right now.

BASH: And, meanwhile, as I discussed with Phil, this is not just a partisan fight, this is having an impact on people's lives, their livelihoods. People are going to start to not see money in their paychecks. And the Trump administration tweeted sample letters for furloughed federal workers to use when negotiating with creditors. This is actually happening. Their (ph) mortgage company landlords. One of the letters, workers are encouraged to offer to do carpentry work or painting if unable to pay their rent and they're told to consult with their personal attorney if they need legal advice.

Gabriella, really?

GABRIELLA ORR, WHITE HOUSE REPORTER, "POLITICO": I know they're being encouraged to sort of haggle with their landlords, haggle with their bosses to try and reach an agreement because they -- you know, many people can't afford to pay their mortgage, can't afford to pay their rent, can't afford to cover the costs of their children's college tuition --

BASH: Because of a political standoff.

ORR: Because of the shutdown. Right.

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: But presumably they have money for a personal attorney.

ORR: Right. I mean, can you imagine, what is the hourly cost of that, that these 400 something -- 400 something thousand federal workers are going to have that money in their back pocket that they don't have to pay rent to cover the cost of a personal attorney. It's, frankly, you know, insulting to many people who I've spoken with who have said this is -- the fact that they were tweeting this out so casually, that they would just assume that people have these resources available who can't pay their rent, who can't cover the costs of college tuition --

BASH: Right.

ORR: They were astounded that this is something that the government put out.

BASH: Also, I'm guessing somebody who works at the IRS or the Coast Guard isn't necessarily fluent in the art of carpentry. I mean it just -- it doesn't make sense.

OK, let's turn to Russia, Evan, because the Russia story has not gotten weird enough. Let's just make it even clearer that it's weirder.

PEREZ: Yes.

BASH: Robert Mueller, the investigation during -- in that it's come to light in a court filing recently that he may be in possession of a nude selfie. Explain.

PEREZ: That's right. And, by the way, thanks for letting me take the nude selfie question.

BASH: You're welcome.

PEREZ: It's -- it's been my yearlong wish for that.

BASH: Your lifeline dream.

PEREZ: Yes, exactly.

BASH: That's why you went into journalism school.

PEREZ: This is exactly why.

So this is basically a fight over whether or not this company, this Russian company, their lawyers here in the United States, get to share information with their owners back in Russia. And so the special counsel has basically said, no, you can only -- you -- the lawyers are able to see secret information that describes some of the process in which the FBI came up with this evidence, including that nude selfie, presumably, of a Russian person. But you can't share it with the Russians. And so I think this -- the law firm that's been -- that's representing Concord (ph) has been having a little fun --

BASH: Yes.

PEREZ: Over the course of the last few months with this case because they say -- they know that they're going to close, but they're fighting a good fight simply because they want to make the point that Mueller is doing an investigation into non-crimes. That's what their point of -- the point of making these court filings.

But, look, I think the issue here is that the FBI, the Mueller team, are very concerned about the sharing of some of this information with the defendants in Russia, that it could end up in the hands of the Kremlin, and that's the reason why they're fighting this (INAUDIBLE).

BASH: Right, things that are much more important to national security than nude selfies.

PEREZ: Right. Very much so.

BASH: For example.

PEREZ: Presumably.

BASH: OK.

So, Rachael, on the issue of Russia, we have learned that House Democrats are hiring more attorneys to presumably, you know, have more oversight and to be more robust in their investigative issues that they're going to go forward on, not when they take over the House. What are you hearing?

BADE: You know, it's not terribly surprising. We knew they were going to do this right after the election. When you're in the minority, you have a smaller budget. And obviously when you take over, take power, you're going to build up your staff.

But what it is, it's a reminder that even though Republican leadership, Nancy Pelosi, Steny Hoyer, are talking about doing bipartisan bills with the president, you know, prescription drug prices or infrastructure, that, at the same time, their chairmen are eager and they want to take a bite of, you know, these various investigations and they're planning to do just that. I think I've talked to a bunch of Democrats on The Hill that feel there's sort of a window right now. We don't know when the Mueller report is going to be coming out.

[13:15:03] BASH: Yes.

BADE: But as soon as that comes out, any sort of bipartisanship is, you know, likely never going to move after that and no -- any bipartisan bills. And so they -- if they are going to get, you know, legislation passed with the president, they're going to have to do that before all these, you know, subpoenas start flying.

BASH: And real quick, Evan, do you have any sense that the Trump legal team, either his private legal team or the White House Councils Office, is ready for this onslaught? I don't. Do you?

PEREZ: No. I mean I -- but, look, I think they see it coming and so they've been --

BASH: I mean are they beefing up the way The Hill is?

PEREZ: They're beefing up the White House's -- the White House Councils Office is hiring probably about 30 lawyers.

BASH: Uh-huh.

PEREZ: So they are -- they know what's coming, I think. And, you know, the issue is simply trying to -- the staff up and to getting ready for what you said is the unexpected onslaught of subpoenas.

BADE: Who would want that job at this point? That would be --

BASH: Yes. Well, that (INAUDIBLE).

PEREZ: Right.

BASH: Rachael, Evan, Gabrielle, thank you so much. Appreciate it. Happy New Year to all of you.

The secretary of Homeland Security is traveling to the border today to see for herself the changes put in place after two children died in border patrol custody. Plus, turning to the former enemy for help? Syrian Kurds asking Syrian

Dictator Bashar al Assad for protection after President Trump ordered a complete withdrawal of U.S. troops from the region.

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[13:20:39] BASH: Got some breaking news out of Egypt, where there has been a deadly explosion involving a bus filled with tourists.

According to Egypt's interior ministry, two Vietnamese tourists were killed and 12 others wounded when an IED hit the bus in Giza. We'll bring you more updates when we get them.

Now another part of the region, in Syria, where there are conflicting reports about who's in control of the border city of Manbij. Syria's military command announced in a televised statement that its troops had raised the Syrian flag in Manbij following what it described as an appeal by the people in the area. The U.S. military rejected that claim, tweeting, despite incorrect information about changes to military forces in the city of Manbij, Syria CJTFOIR has seen no indication that these claims are true. We call on everyone to respect the integrity of Manbij and the safety of its citizens, hash tag defeat ISIS.

I'm joined now to discuss this with CNN global affairs correspondent Elise Labott and national security analyst Samantha Vinograd, who served as a senior adviser to the national security adviser in the Obama administration.

OK, this is an incredibly complicated story.

Elise, I know you can kind of boil it down to why it matters what is happening and potentially happening with the Kurds in Syria.

ELISE LABOTT, CNN GLOBAL AFFAIRS CORRESPONDENT: Well, this is exactly what everyone feared, a free-for-all, in what was, you know, one of the most stable parts in Syria because of the, you know, cooperation between U.S. forces and the Syrian Kurds, particularly the YPG, and the U.S. had been supporting these Kurds to fight ISIS. Now that President Trump has announced that he is withdrawing, there was a lot of concern that he was abandoning the Kurds, which have really been a stable partner. And now it's a free-for-all where the Kurds have cut a deal with Assad. It's pretty clear they've been kind of flirting with him for a while but now they've cut a deal for Assad to come back into the area and that leaves the Kurds free to go after their real nemesis, which is Turkey. You know, they're looking for a separatist area between Syria and Turkey and now this really leaves Turkey pretty vulnerable.

BASH: So -- exactly. So when the president announced abruptly that he was going to pull U.S. troops out of Syria and then the defense secretary resigned, one of the things that we heard from him and from others was concern that the Kurds would feel abandoned.

LABOTT: It's pretty obvious that they do. BASH: And what you're saying and what we're -- what we're seeing is they feel so abandoned that they cut a deal with a bad guy in the region, from their perspective, and most people's perspective, Bashir al Assad.

SAMANTHA VINOGRAD, CNN NATIONAL SECURITY ANALYST: This is a deal with the devil. I mean just on a human level, imagine the thought process that you are turning to a war criminal who uses chemical weapons against civilians to guarantee your safety against a Turkish onslaught. I think our forces in this area have served as a deterrent. They've served as a deterrent to Turkey and their designs on the Kurdish forces that are there, but they've also served as a deterrent against Bashar al Assad. Bashar al Assad has not acted against the civilians in this region because we've had forces on the ground. He hasn't used chemical weapons there recently and he hasn't other used -- used other forms of war crimes because out forces were there and he didn't want to get crosswise with us.

The Kurds are making a calculation that working with the regime in the short term may protect them. They've worked with the regime before in other parts of Syria, in a region called Afin (ph), but I don't think they're fooled in thinking that this is a long term solution. Bashar al Assad is not a reliable guarantor of anyone's safety, including the Kurds.

BASH: And so -- and let's talk about what this means more for the region and then, you know, I guess more globally. We're waiting, I believe, that Lindsey Graham, who is a powerful force on these issues on Capitol Hill, has been an ally of the president on a lot of issues, but has been very outspoken against the president's decision to pull troops out of Syria, is saying that this is a nightmare for Turkey and eventually Iran, saying that this is exactly what Russia, Syria and Iran wanted.

LABOTT: That's absolutely right.

BASH: Explain why.

LABOTT: Well, look, the U.S., as Sam said, was providing -- acting as a buffer, not just, you know, in terms of fighting ISIS with the Kurds, but they were providing a buffer from the Kurds to go against Turkey. Then they were also kind of being a check, and this is why the U.S. was, a couple of weeks ago, going to stay in Syria because they wanted to eradicate all Iranian proxies and forces out of Syria.

[13:25:20] So now the -- Syrians, the Iranians, the Russians have a free reign in Syria. They've cut this deal with the Kurds for now. So the real losers here are the Syrian people and the Turks.

BASH: And you have President Trump saying over and over again, I talked to President Erdogan in Turkey. He's fine. He's going to stick with the Kurds. This makes it clear that's not possible.

LABOTT: Yes, he's going to -- he's going to stick with the Kurds.

BASH: Stick it to the Kurds. LABOTT: He's going to stick with making his promises of going after the Kurds.

BASH: Exactly.

LABOTT: I mean it's pretty clear, you know, the U.S. has been kind of beating him back and that's caused a lot of problems between the U.S. and Turkey for, you know, the last several years since the U.S. has been working with the Kurds and now, you know, they basically said to Turkey, have at it.

BASH: And what -- what does this mean also for ISIS.

VINOGRAD: Well, Erdogan will throw a temper tantrum. We should guess that he's picking up the phone right now and calling Vladimir Putin, not President Trump to figure out what to do about this situation.

LABOTT: Exactly.

VINOGRAD: But there's a bigger macro impact here that we have to keep in mind.

BASH: Yes.

VINOGRAD: The Russians today, and for the past few days, have been very purposefully participating the United States as an unreliable ally, as an unreliable partner. And this fits with the broader narrative that the United States changes its tune on a whim, which is not entirely untrue at this point. You look at the international agreements that we backed out of. You look at the allies that we're now abandoning. And this plays right to Vladimir Putin's larger designs of painting the United States as non-credible and is unreliable.

Foreign Minister Lavrov of Russia gave statements today saying that we were aggregating (ph) our responsibilities in the fight against ISIS. And so this really helps diminish U.S. credibility on a global stage, which will definitely impact our ability to promote influence around the world going forward.

BASH: Yes, it's absolutely fascinating and it's, as you both predict, and many others predicted, the dominos are starting to fall.

LABOTT: Exactly.

BASH: I just want to say that I mentioned that tweet Graham just -- here's the actual tweet. If reports are accurate about Kurds aligning with Assad, major disaster in the making. Nightmare for Turkey and eventually Israel. Big winners are Russia, Iran, Assad, and ISIS.

LABOTT: Completely predictable.

BASH: Thank you both. Great to have you to break it all down.

And on Capitol Hill, Democrats want answers after two children have died in Border Patrol custody in just one month. Details on the hearing that top senators are demanding.

And, the roller coaster continues on Wall Street. Stocks bouncing between the positive and the negative all day long. We're going to go behind that volatility. Stay with us.

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