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Showdown Looms as Democrats Ready Subpoena for Mueller Report; President Trump Slams Puerto Rico's Leaders After Disaster Aid Bill Stalls; Police Identify Suspect in the Killing of Nipsey Hussle; Several Injured in Stampede During Slain Rapper's Vigil in the U.S.; Saudi Government Gives Payments and Houses to Khashoggi's Children; Rep. Michael Waltz (R), Florida is Interviewed About President Trump Slamming Puerto Rico After Disaster Aid Bill Stalled; White House Senior Adviser Tells Surrogates Trump Hasn't Decided Yet if He'll Shut Down Southern Border; Auto Industry Expert: Entire U.S. Car Industry Would Shut Down Within a Week if U.S.-Mexico Border is Closed; U.S. Cutting Off Aid to El Salvador, Guatemala and Honduras; Investors to Watch U.S.-China Trade Talks This Week; Trump Punts on Healthcare; Six House Chairs to Demand Full Mueller Report. Aired 9-9:30a ET

Aired April 2, 2019 - 09:00   ET

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


[09:00:23] POPPY HARLOW, CNN ANCHOR: All right. Top of the hour. Good morning, everyone. I'm Poppy Harlow.

JIM SCIUTTO, CNN ANCHOR: And I'm Jim Sciutto. We're back next to each other again. Actually --

HARLOW: Can you believe it? Hey, stranger.

SCIUTTO: At the same desk. One week after President Trump promised that the GOP would become the party of healthcare and that he had a plan in the works, he punts.

Was there even a plan? He is now saying the Republicans will wait until after the 2020 elections to vote on a plan to replace the Affordable Care Act.

HARLOW: So what happened to that Republican plan? And did the president just tee up a winning battle for the Democrats? That's the key question this morning.

Let's go to the White House, Joe Johns is there. Good morning, Joe.

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Poppy. Well, the truth is the president ran into reality on this issue. There was heated debate we know among some of his top advisers about whether to go down the road once again of trying to repeal and replace, if you will, Obamacare.

A lot of back and forth right there in the Oval Office, and then what we also had was a lawsuit, a lawsuit essentially invalidating Obamacare which the administration decided to jump into which at that time saying, hey, we agree with this. The problem is of course on Capitol Hill Democrats took it and ran

with it and in the Oval Office just last week I asked the president about healthcare. Now he said as far as a lawsuit goes, he was expecting to get a good result in the Supreme Court and after that he said aspirationally that they'd have something even better than Obamacare, but that was pretty clear they did not have a plan as of that time.

Now it's also really about the reality that Democrats did very well in the midterm elections and Obamacare was the number one issue.

Back to you.

HARLOW: Joe Johns, appreciate the reporting. Thank you.

SCIUTTO: Let's discuss now with Dana Bash, CNN chief political correspondent Ron Brownstein, senior editor for "The Atlantic."

Dana, let me ask you this because the kind of conventional wisdom, if it's that, talks so much about President Trump's political instincts, right, are based largely on, you know, a huge surprise win in 2016, but since then he made immigration a big issue in the midterms, did not work well on him. It's in the polling. And in healthcare did not work well for Republicans either in 2018.

This issue seems to be one that is perfectly designed to benefit Democrats in the 2020 cycle. What's happening? Did he make a mistake here?

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: Yes. Yes. I mean, the answer is yes, he clearly made a mistake because how many times have we seen the president do a total 180 on something.

SCIUTTO: Yes.

BASH: Usually when he goes in, he doubles down, he triples down.

SCIUTTO: The shutdown, right, didn't we do a 180 on that?

HARLOW: Yes.

BASH: He did a 180 on that but he -- it took him a long time. I mean, this is -- this is -- I mean, the shutdown was a big deal, but this is a bigger deal I think just in terms of setting the table for a very important election to come up. And it was head-scratching to certainly pretty much every Republican on Capitol Hill and more importantly, as Joe was talking about, to a lot of those in his own -- in his own White House because not only is this something that they couldn't get done with complete Republican control in the first two years of his term, but how is he going to get it done with a Democratic House unless there is a real compromise on healthcare? It's just not possible.

HARLOW: Which the White House knows so I was supposed to hear Mick Mulvaney over the weekend.

BASH: Yes.

HARLOW: Say, well, this is like tax reform. No, it's totally different because you control both chambers and you don't this time.

BASH: You know what, Poppy, it gives you a hint as to where this is coming from.

HARLOW: That's a good point.

SCIUTTO: Yes.

BASH: You know, Mick Mulvaney came from the House.

HARLOW: Right. Right.

BASH: And he, you know, voted 127 million times to repeal and replace Obamacare.

HARLOW: Yes. Sure. So, Ron, your piece this morning is great on this.

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Yes.

HARLOW: Because as Dana just teed up the Democrats have a great opportunity here, but are they going to fumble it by infighting over do we do everything we can to support Obamacare or do we follow Bernie Sanders more and work on phasing in a Medicare for all?

BROWNSTEIN: Yes.

HARLOW: How could the Democratic Party win on this and how could they fumble the ball here?

BROWNSTEIN: Well, look, you know, healthcare was the single most important issue driving the Democratic hands in 2018.

SCIUTTO: Yes.

BROWNSTEIN: Full stop, particularly to the extent they recovered at all with those blue-collar white voters in the rust belt who were so important to Trump in 2016, it was around healthcare, especially women. And I think the president, by essentially making the 2020 election a referendum, by promising that he will again try to repeal Obamacare, the Affordable Care Act, if he is reelected, has teed up the -- that will be the fundamental contrast.

[09:05:05] No matter what Democrats come up with, will be whether or not to repeal the ACA. I mean, he has put that on the ballot in a very direct way, but Democrats still do face the choice. We see one path which is what the House Democrats are now advancing legislation to overturn some of the Trump regulatory actions and also to expand the subsidies for people to buy coverage. So that's reinforcing and shoring up the Affordable Care Act.

The other alternative is what Bernie Sanders is talking about, who pointedly did not endorse that legislation last week. HARLOW: Yes.

BROWNSTEIN: He wants to -- he also wants to replace the Affordable Care Act with a single payer Medicare-for-all as do some of the other Democrats. And I think this will be a fundamental choice for Democrats in the 2020 primary. Do they shore up the ACA or do they also seek to rescind it and replace it?

BASH: And that's why it's not clear whether it is a loser for Donald Trump going into 2020. We don't know the answer to that because of what Ron was just saying, because if there is a Democratic nominee who supports Medicare-for-all and, you know, getting rid of private insurance, then, I mean, that is the ultimate -- the Super Bowl of debates on healthcare.

SCIUTTO: Comes down to trust, though, doesn't it? Who do voters trust more with the issue.

BASH: Yes.

BROWNSTEIN: No question on the party.

SCIUTTO: But let me propose a theory here.

BASH: Yes.

SCIUTTO: Does President Trump actually want a solution and a plan to these issues, whether it be the border or healthcare? Because President Trump in our experience thrives off the chaos of it. You know, he thrived whether it helped him politically off the idea of a crisis at the border during the midterms. Is it possible that the churn crisis at the border, closer the border chaos, having a big healthcare debate is actually the desire --

BASH: Yes. It's a great question.

SCIUTTO: -- rather than a result?

BASH: It's a great question. My understanding in talking to people around the president that for them people planning his political strategy it is a genuine struggle because you want to say, hey, I have these accomplishments. They're hoping that that bucket will be the economy full stop and you also want to keep those small dollar donors which are grassroots activists, they are one and the same, interested, excited, angry, and that's what immigration does.

Now immigration certainly did not help the president when it came to the House in 2018, didn't help Republicans, but I think it did and certainly Democrats who lost in the Senate races in 2018 will say that it did help them.

BROWNSTEIN: Rural versus suburban, though, really.

BASH: Exactly.

BROWNSTEIN: You know, look, I would distinguish between the two issues. Clearly on migration he is looking constantly to gin up his base and to convince them that there is this crisis coming and that he in effect is the human wall who is preventing these kind of hoards of people that don't look like them from coming into the neighborhoods.

SCIUTTO: You see that plaque on the wall he posted.

BROWNSTEIN: And -- right. But healthcare is very different. I mean, I think on healthcare there is -- that is the biggest vulnerability in terms of the agenda because one of the things he promised to those blue-collar voters was that he was going to protect them.

HARLOW: Yes.

BROWNSTEIN: And take care of them. It is worth noting that even though the, quote, "no plan," their budget does have a plan. The budget that he put out only a few weeks ago would replace the ACA with block grants like Lindsey Graham and Bill Cassidy proposed, block grant Medicaid, and cut them both by $775 billion over the next decade which would revoke coverage for millions, also ending the ACA protections on preexisting conditions. And even though he doesn't want to talk about that, you can bet Democrats will be talking about that in 2020.

(CROSSTALK)

SCIUTTO: That's the plan.

HARLOW: Yes. And look, the bottom line is something has to change because this new survey out this morning, one in eight Americans have to borrow to afford healthcare to the tune of $88 billion in borrowing.

BASH: Yes.

HARLOW: So it's not working for everyone. Will a Republican plan make it better or worse? We'll see.

BASH: God forbid they actually work together to fix it.

HARLOW: Imagine that.

BASH: I know. That's so crazy.

HARLOW: Dana.

(LAUGHTER)

BROWNSTEIN: That's earth two. That's an alternate universe.

SCIUTTO: Thank you, guys.

HARLOW: Yes, welcome back to earth. Thank you, guys, very much. We appreciate it.

So today is the day that Attorney General Bill Barr is supposed to hand over the entire unfiltered, unredacted Mueller report to the House Judiciary Committee, complete with the underlying evidence. It's still early, it's 9:08 a.m., so we'll see. But let's just assume this is probably not going to happen today.

SCIUTTO: This would many subpoenas, a familiar word, for the report, for the evidence, for interviews, even while Barr promises to turn over something more complete than his initial four-page tiny recap but less than what Mueller gave him.

CNN's Manu Raju is on the Hill. Where do things stand today on what was meant to be a deadline day?

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Yes. Six House Democratic chairmen just sent a letter to Bill Barr demanding the release of the full unredacted report. They also call for Bill Barr to testify now, not wait until May as he's proposed, but now. They also are urging Barr not to, quote, "interfere" with Special Counsel Robert Mueller because they want to bring Mueller before the House panels as well to testify. They're calling on that and they are making it very clear that they will subpoena Bill Barr for the full unredacted report if they are not able to get that.

Now earlier this morning Nancy Pelosi made it very clear that she will use the weight of her power in this majority to push for the full report.

(BEGIN VIDEO CLIP)

[09:10:06] REP. NANCY PELOSI (D), HOUSE SPEAKER: Let's show us the truth and there is no reason why they couldn't be putting some of this out. I understand sources and methods, but that's no excuse for hiding the truth from the American people. So we'll just see, you know, as we go forward.

(END VIDEO CLIP)

RAJU: Now Republicans say this is essentially just an arbitrary deadline. Give Bill Barr some time. He said he would provide as much transparency as possible. Barr of course said by mid-April he plans to provide at least a redacted version of the report, but clearly not going to satisfy Democrats who plan to authorize subpoenas in the House Judiciary Committee tomorrow -- Jim and Poppy.

SCIUTTO: OK. Other subpoena drama Oversight Committee news that you reported yesterday which is about White House security clearances and two dozen people who got clearances overruling recommendations. What's going to happen there?

RAJU: Yes, Democrats at 10:00 a.m. will meet before the House Oversight Committee to discuss this and authorize a subpoena for at least one individual. Carl Klein, who is a former director of personnel security at the White House, they want to talk to him about the concerns that were raised by this person that they're calling a whistleblower, Tricia Newbold, who works at the White House who has raised concerns that roughly two dozen people had their security clearances approved despite those initial denials. So expect that subpoena to be authorized at this committee vote this

morning, but expect a lot of fireworks, too, because Republicans call this another arbitrary and reckless move in the words of Republicans. So this is going to be pretty contentious in just a matter of minutes here, guys.

HARLOW: All right. Manu, thank you for the reporting on both fronts.

We are lucky to have our chief legal analyst Jeffrey Toobin by our side. Thank you for being here. Let's back up and start where Manu started, and that is on the deadline that Bill Barr is not going to hit today, right. This deadline the Republicans call arbitrary for turning over the full report. The underlying evidence. He tics through these four areas that he thinks needs to be redacted. One of them, his argument is by law that's grand jury info. We know those courts can overrule that and can rule that that can be turned over. We saw it in Watergate.

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Not only that, you know, the way we have -- Barr in particular has been discussing these categories. It's as if they are ironclad and clear. It is not clear often what's grand jury material and what's not. You know, by its narrowest definition it's just the testimony that's given in the grand jury, but there are some courts and some prosecutors have said, no, anything that was discussed in the grand jury is off limits.

How Barr chooses to interpret the scope of grand jury secrecy is very important in how he resolves this.

HARLOW: Just to that point, during Watergate the fact that the grand jury information and report, the grand jury's report was turned over to the House Judiciary Committee. I mean, like --

TOOBIN: That's right. That's right. They went to a judge. You can always go to a judge in the district that is supervising the grand jury and say we believe it's in the public interest to disclose this material.

HARLOW: Right.

TOOBIN: Has the Justice Department done that? That would be a secret proceeding at this point.

HARLOW: OK.

TOOBIN: If they haven't, and the question Democrats are going to ask is, why didn't you? Why didn't you make this effort to get stuff -- more stuff public?

SCIUTTO: OK. The key information that folks want to see from this report is what evidence Mueller discovered principally of obstruction of justice by the president because he said he did discover evidence on that side. Now the fourth category of information that Barr says he won't release is stuff that affects the privacy of third parties or sullies their reputations, et cetera, for people who weren't charged with crimes. Does that mean Barr will say, listen, I can't release that evidence or

much of that evidence because these people weren't charged and to put it out there would unduly hurt their reputations?

TOOBIN: I mean, that category is potentially so broad.

SCIUTTO: Yes.

TOOBIN: And think about how that affects President Trump. Remember, there is this Justice Department policy that says he can't be charged.

SCIUTTO: Right.

TOOBIN: At the same time, are they going to say, well, you can't release any information because he wasn't charged? That means heads he wins and tails he wins.

SCIUTTO: Right.

TOOBIN: Because -- so --

SCIUTTO: But he set up that standard.

TOOBIN: Well, that --

SCIUTTO: Is it possible --

(CROSSTALK)

TOOBIN: That's the thing that is so significant about the task Barr is undertaking, is that there are tremendous numbers of judgment calls involved. It is not just a mechanical application of these four principles, it is Barr's -- Barr's opportunity to release a lot or release a little and he's going to say, I assume, well, the law forced me to do this.

SCIUTTO: Of course.

TOOBIN: The law didn't force him.

SCIUTTO: Who do you trust to make those judgment calls? That's a question.

[09:15:00] JEFFREY TOOBIN, CNN LEGAL ANALYST: We see how much Barr actually censors, then the fight will really be joined.

JIM SCIUTTO, CO-HOST, NEWSROOM: Jeffrey, thanks very much.

TOOBIN: All right --

SCIUTTO: President Trump slamming Puerto Rico's leaders after a disaster aid bill stalls. Puerto Rico is a U.S. territory, those are Americans who live there. The president says, "we can't hurt our farmers in states with these massive payments." Has he forgotten they're Americans? POPPY HARLOW, CO-HOST, NEWSROOM: Plus, a memorial for rapper Nipsey

Hussle ends in a stampede as police name a suspect in the shooting death of the Grammy-nominated artist. And six months ago today, journalist Jamal Khashoggi was murdered. The "Washington Post" now reports his children are receiving houses and payments as compensation from the Saudi government for his murder.

But will the U.S. ever really make Saudi Arabia pay for its role in Khashoggi's death?

[09:20:00] (COMMERCIAL BREAK)

HARLOW: All right, welcome back. This morning, President Trump is continuing to lash out at Puerto Rico's leaders after the Senate failed to advance a disaster aid bill. Earlier this morning, here is part of what the president wrote, quote, "all their local politicians do is complain and ask for more money. The polls -- the politicians are grossly incompetent, spend the money foolishly or corruptly and only take from the USA.

Cannot continue to hurt our farmers and states with these massive payments." Joining me now on this and much more is Congressman Michael Waltz of Florida; he serves on the Armed Services Committee, he also served in the U.S. Army for more than 20 years, 23 to be exact.

He is the co-founder of the Four-Country Caucus which is veterans, both Republicans and Democrats. Good morning, sir.

REP. MICHAEL WALTZ (R), FLORIDA: Good morning.

HARLOW: Before we move on to some of the other key topics, let me just ask you about the president's message here because as you well know, Puerto Rico is a U.S. territory, those are American citizens.

WALTZ: Yes --

HARLOW: Is the president suggesting Americans are taking money from other Americans or placing the importance of one group above another?

WALTZ: Well, look, of course, Puerto Ricans are our fellow Americans. I've fought alongside Puerto Ricans all over the world as a green beret and actually they have a disproportionate high amount of service compared to all of the other states.

But, look, I think the president is frustrated here. We have appropriated over $91 billion both short term and long-term funding, I think an important point, Poppy, a lot of that funding are actually HUD grants that get pushed down. And according to the statistics I've seen, a lot of that money is still going unspent.

So I do think there is an onus of responsibility on local leaders to spend this money effectively as well. And the other point of his frustration and mine as well, representing Floridians, is the package that was defeated yesterday, this disaster relief package affected the Florida Panhandle. Hurricane Michael is the only storm that has not had a supplemental,

we have major Air Force bases there that need to be rebuilt. Aside from all of the relief that our fellow Floridians need. So a lot is getting wrapped up in this. Back to Puerto Rico, they're running out of snap funding, I mean, they're out.

So, I think for the Democrats to say, well, it's not enough, I'd say several hundred million dollars is more than what they currently have. So, we need to pull politics --

HARLOW: Just before we move on --

WALTZ: Yes, sure --

HARLOW: To some other topics which I really want to get to, though --

WALTZ: Yes --

HARLOW: I take it, you don't agree with the way that the president has phrased it this morning, saying, look, it's taking money away from our farmers in the heartland, et cetera, right?

WALTZ: Well, there is a -- look, there's a zero sum to spending these funds and, again, they told local leaders --

HARLOW: Yes, but aren't they all equal --

WALTZ: But we're all Americans --

HARLOW: I guess why I'm asking is, aren't they all equal Americans --

WALTZ: Absolutely, let me be 100 percent clear, we are all Americans --

HARLOW: Yes, OK --

WALTZ: They are American citizens and deserve the help --

HARLOW: All right --

WALTZ: But they also need to hold local leaders accountable.

HARLOW: All right, so let's move on to the border, just quick yes and no here and then we'll dig into it on the president's threat, potentially shut down the southern border. Yes or no, do you support that?

WALTZ: Well, I think there's actually some middle ground. We do need to send a message to Mexico, this is an emergency, but I think you can stop pedestrian flows while not stopping railroad, trucking --

HARLOW: OK --

WALTZ: And other things that are keeping our economy alive.

HARLOW: So not a full -- WALTZ: So --

HARLOW: Not a full -- you do not support a --

WALTZ: Yes --

HARLOW: Full closure for trade and vehicles. OK, so let's talk about the --

WALTZ: Yes --

HARLOW: Economic toll because, you know, it's not every day -- and it's actually very rare that we hear the Chamber of Commerce call out the president for his economic policies, but they this morning are warning, sort of blinking red light, saying this would be an economic calamity if the border were to shut. You've got $1.7 billion of goods crossing every --

WALTZ: That's right --

HARLOW: Single day. So are you concerned about the economic toll, what this would mean?

WALTZ: Oh, I am concerned about the economic toll, particularly if it goes on for several days, but at the same time I'm concerned that year after year, administration after administration, Congress after Congress hasn't gotten this problem solved. And you know, we have -- we have the border patrol beyond capacity.

It is a human -- it is a human rights issue at this point, they're overflowing, so either they push them back or they just release them into American society. I think Congress needs to do its job, fix these asylum laws. And then also the Mexican government needs to also step in and help with this issue.

So it's a multi-facetted issue here that nobody is really addressing, and I think the president is ready to take dramatic action.

HARLOW: On the Mexico point, I would just note "New York Times" reporting this morning that Mexican authorities are currently blocking migrants at certain border towns, refusing to allow them into international bridges for some of those asylum seekers.

But let me get you -- just still on --

WALTZ: Yes --

HARLOW: The economics of all of this because really interesting reporting just crossed from our business team. The center for automotive research which is nonpartisan --

WALTZ: Right --

HARLOW: Just said this morning, sir, the entire U.S. auto industry would shut down within a week if the president completely closes the southern border. [09:25:00] You've got 37 percent of parts for autos that originate in

Mexico, we've got a million U.S. workers according to the Labor Department that work at these auto plants and parts plants. Is that economic toll worth it?

WALTZ: Well, look, I am -- I am hoping we don't have to go here. I am hoping that this -- this talk of dramatic action on the border actually gets Congress to start moving. Congress doesn't like to do anything I've learned in my short time here, unless there is a deadline, unless there is a crisis. And at the end of the day, look, we still have DACA, we still have TPS, we have --

HARLOW: Right --

WALTZ: The visa issue. You know, all of those issues aren't being addressed until we get this border problem solved --

HARLOW: So --

WALTZ: Which I think is appropriate because otherwise you're just going to repeat the same issues year after year after year. So we do --

HARLOW: But just quickly --

WALTZ: Have to get -- I mean, whether he declares an emergency, whether he kicks it over to Congress, we just can't seem to get this done. And this building is who needs to take dramatic action, not the --

HARLOW: Right --

WALTZ: President.

HARLOW: Finally, when it comes to cutting off aid to the northern triangle countries, El Salvador --

WALTZ: Yes --

HARLOW: Honduras and Guatemala, the head of CPV was on "ABC News" in December, Kevin McLean(ph), and let me just read you part of what he said about the aid that was flowing then that the president now said he will cut off.

He said "we need to invest in Central America", he went on to say the State Department's announcement of an unprecedented increase in aid is a tremendous step forward because Congressman, as you know, his argument is that helps people in their current countries and incentivizes them to stay there. Is he right, and if so, was it a mistake for the president to cut off aid?

WALTZ: So I think we have to look at the results. We've spent several billion dollars over the last three years and what are the results that we're getting? So, again, this is about -- and I think that -- you know, you learn this in business and I've run a business myself, this is about accountability, it's about results. We're not getting the results, so I think the president is right to

relook at it and look how it's being spent. Hold both --

HARLOW: But the --

WALTZ: The State Department and those countries accountable, but at the same time, I do not agree with a complete cut off. I do not think --

HARLOW: OK --

WALTZ: We just go to zero, but I do think we have to look at where is that money going and why are we not getting the result that we would expect for billions of dollars going into those -- into those countries.

HARLOW: Congressman, we wish you and your fellow members of Congress luck on that bipartisan push. Let's see what can get done. Thanks.

WALTZ: All right, thank you so much.

HARLOW: You got it.

SCIUTTO: Interesting chat, no question there. On some of those questions, I don't have an answer, right?

HARLOW: Right --

SCIUTTO: When you look at the plan. We got a lot more coming up, several people are trampled and hurt during a vigil for murdered rapper Nipsey Hussle. This as police identify now the suspect in his death. Look at those pictures there. And we are just moments away from the opening bell on Wall Street, a strong start to the second quarter, but investors are keeping a close eye on trade talks between the U.S. and China, they're still going on and they continue this week.

(COMMERCIAL BREAK)

END