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Democrats Not Optimistic IRS Will Release Trump's Tax Returns; Trump: I Am the Only Person Running Homeland Security; Deadly Gas Explosion in North Carolina; Lori Loughlin Didn't Engage in Plea Agreements Talks in College Scandal. Aired 2:30-3p ET

Aired April 10, 2019 - 14:30   ET

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

[14:30:00] BROOKE BALDWIN, CNN ANCHOR: The chairman of the House Ways and Means Committee had given the IRS chief until today to hand over six-years-worth of the president's personal and business filings. And while the Treasury Secretary Steve Mnuchin says he is aiming for a response by the end of the day, President Trump is repeating the claim that, hey, he doesn't have to give them up because he's under audit.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I would love to give them. But I'm not going to do it while I'm under audit. It is very simple. Remember, I got elected last time, the same exact issue, with the same intensity, which wasn't very much. Because, frankly, the people don't care.

But I have no obligation to do that while I'm under audit. And no lawyer would tell you to release your tax returns while you're under audit.

(END VIDEO CLIP)

BALDWIN: Mark Everson served as IRS commissioner from 2003 to 2007. He is now vice chairman of AlliantGroup, a tax consulting service.

So, Mark, thank you for being with me.

And if I may button up what the president said, we have read about how Nixon said he was under audit and even he released his taxes.

Let me begin with this. What exactly -- take me behind the scenes. With this request, what exactly is the current IRS commissioner wrestling with right now? What is he deciding?

MARK EVERSON, VICE CHAIRMAN, ALLIANTGROUP & FORMER IRS COMMISSIONER: Well, I think the question is -- the law is clear here, Brooke, and the question is, does the service comply with the law. The -- routinely the chairman of Ways and Means ask for tax returns. They may be looking at, is there a problem in the system, are there abuses that are systemwide that call for a legislative response. They would look at individual results. And they would look at how the service is doing its job in that instance. But here you have a broader set of principles. Not just compliance with the law as written but also a core separation of powers issue that I think -- between two co-equal branches of government.

BALDWIN: So if you were still in your same job now, am I hearing you correctly, would you give Congress what they are requesting?

EVERSON: Well, I would. And I have to say that, when I was commissioner, which was a little over four years, never did anybody in the White House or did anybody at Treasury make a statement that would bind me one way or another, like the chief of staff has said the Democrats will never see those returns. That never happened --

(CROSSTALK)

BALDWIN: You would never say never?

EVERSON: No. And the chief of staff never got anywhere near a matter that was in my purview.

BALDWIN: You do say, in reading some of your notes, you say that one problem may be the stated purpose of the inquiry from Ways and Means. Can you explain that a bit further?

EVERSON: Sure. I think that the committee is entitled to ask for a return but I don't like the way they've justified it. Frankly, I think that the special counsel probably has those returns. After all, he made tax cases against Manafort. They should have wait and see what happens with the Mueller report when it gets released, and then make their determination. And it is more, to me, oversight. They've justified it on the basis, we have to see if the audits are being done correctly. I'm concerned that that potentially compromises the IRS, even though I do believe that they're entitled to the information.

BALDWIN: But you're not saying that the president's tax returns might be in the 300- or 400-page Mueller report, are you?

EVERSON: No, I'm not saying that. But I suspect that just as they asked for tax returns and then made tax cases against Manafort, I suspect if they are looking at entanglements with Russia, they looked at what the tax returns said. That is pretty standard for criminal proceedings.

BALDWIN: Got you.

Now the White House, as you well know, has vowed to take this fight all the way to the U.S. Supreme Court if they need to. But now with -- you have two Trump-appointed justices on the bench. Whatever is inside of these tax returns, Mark, do you think it is worth it for Democrats to push it that far?

EVERSON: I, again, I do not like the way they've made this request. So I think there's a certain amount of hair on it to compromise the whole system. But, no, I don't think that is the case that they should push it all the way. It is an issue that -- it just increases the partisanship in the country and -- look, Americans, Brooke, across the country will file taxes next week, if they haven't already done it. To put our tax system in the middle of politics is not a good thing. BALDWIN: OK. Mark Everson, thank you for your perspective in

reminding us D-Day is next week for the rest of us.

EVERSON: Yes. Thank you.

BALDWIN: Thank you.

Another day, another resignation. So who runs Homeland Security? I do, said the president. We'll discuss all of that chaos.

[14:34:33] Plus, we're keeping an eye on breaking news out of North Carolina. Look at this. A massive gas explosion. This is downtown Durham. The horrifying mistake that caused such massive destruction.

(COMMERCIAL BREAK)

BALDWIN: Just a few days after her boss, Kirstjen Nielson, was forced out and she was passed over for the top job at DHS, Department of Homeland Security, Claire Grady, the acting deputy secretary, is also heading for the exit. Brady joins several others in what has been described as a near systematic purge of the agency. Officials tell CNN that Grady knew her fate was tied to Secretary Nielsen, who was at odds with immigration hardliner and top White House adviser, Stephen Miller.

President Trump recently empowered Stephen Miller to take the lead on all issues concerning immigration and the border. And at least one source said that Miller might as well be the next Homeland Security since he is the one driving the policy.

Here is how the president reacted to that idea earlier today?

(BEGIN VIDEO CLIP)

UNIDENTIFIED REPORTER: Have you ever thought about naming Stephen Miller the DHS Secretary?

TRUMP: No. Stephen is an excellent guy, a wonderful person. People don't know him. He's a wonderful - he's been with me from the beginning. He's a brilliant man. And, frankly, there's only one person that is running it. And you know who that is? It's me.

(END VIDEO CLIP)

[14:40:01] BALDWIN: Gil Kerlikowske was the U.S. Customs and Border Protection commissioner during the Obama administration.

Gil, thank you for being with me.

And let me ask you, just listening to that sound with the president, how comfortable are you with the fact that Stephen Miller, this 33- year-old who authored the travel ban and also urged the White House to really dig in on border wall demands, has such a prominent role in setting current immigration policy?

GIL KERLIKOWSKE, FORMER COMMISSIONER, CUSTOMS AND BORDER PROTECTION: Well, it is one failed policy after another now two and a half years into it. You really have to look at the boy genius behind it all, Stephen Miller.

BALDWIN: You think he's a boy genius?

KERLIKOWSKE: No, I don't quite think that. But if you look at who should be fired, rather than all of these agency heads and all of the people who understand the complexity and the difficulty around immigration, which our country has wrestled with for quite some time, the person that ought to be fired is Stephen Miller.

BALDWIN: Well, we know how much the president values him. He may not be the head of DHS but he's the guy driving the ship it seems.

But I want to ask you about Kevin McAleenan. This is Trump's pick to run DHS as the acting secretary. And he was your deputy and you called him a patriot, said he was faithful and acted with integrity. But he helped put into place the zero-tolerance policy that led to the family separations. And CNN has learned the president recently pushed to reinstate the policy, which Secretary Nielsen resisted. Nielsen, according to a source, was worried that Trump was becoming unhinged on immigration and possibly -- potentially, illegal requests. So my question is, do you worry that McAleenan would be a yes-man or will he run DHS within the confines of the law.

KERLIKOWSKE: Kevin is a lawyer. He's very smart. He's a patriot and has great integrity and honesty. So I think following the law is going to be crucial and critical to him. And I promoted him to deputy commissioner.

The family separation, from the humanitarian stand point to the legal standpoint, has been an absolute disaster. And it is a disaster to the American public. And remember, too, that the difficulty of being a Border Patrol agent -- you join the Border Patrol to arrest drug smugglers, to arrest human traffickers. You didn't join the Border Patrol as an agent to pull 2-year-olds from their mothers.

BALDWIN: OK. So I hear you, he's a lawyer and a man of integrity. What about the fact that there were a record number of border apprehensions last month, driven by people fleeing Central America? And we know the Trump administration announced they will yank aid to those three countries, Honduras and El Salvador and Guatemala, because Trump says, quote, "They haven't done a thing for us" in helping to stem the influx of migrants. So, Gil, given all of your experience, might that worsen the problem?

KERLIKOWSKE: Oh, that will absolutely worsen the problem. I testified this morning to the House Foreign Affairs Committee and there's just bipartisan unanimity to support aid to these three Central American countries. It is a very small amount of money. But it is also the people that are boots on the ground from the Drug Enforcement Administration to the FBI to others. They help to make those countries safer and they also work to make our country safer by sharing and exchanging information. And that makes much, much more sense than trying to say, well, let's build a wall and just try and apprehend everybody. But you should also recognize, and people do need to recognize, these numbers are crisis numbers. And --

(CROSSTALK)

BALDWIN: Which numbers?

KERLIKOWSKE: The 92,000 people and probably --

(CROSSTALK)

BALDWIN: That are crossing?

KERLIKOWSKE: -- 700,000 crossing the border. It is clear to me that it is a crisis. It needs a lot of action. But cutting foreign aid or cutting this very small amount of aid to the three Central American countries makes zero sense.

BALDWIN: Gil Kerlikowske, thank you, sir.

KERLIKOWSKE: Thank you.

[14:44:07] BALDWIN: New details today in that college admissions cheating scandal. Actresses Felicity Huffman and Lori Loughlin are handling the accusations in very different ways. We'll talk about behind-the-scenes behavior. Could it be making an impact? Judge Greg Mathis joins me next.

(COMMERCIAL BREAK)

BALDWIN: In Durham, North Carolina, a gas explosion leveled a building and sent first responders scrambling to find the injured, get them to hospitals. And we're told one person has died and several more are injured.

CNN's Rosa Flores is following this for us.

Rose, what happened and do we have any other updates as far as injuries?

ROSA FLORES, CNN CORRESPONDENT: Well, Brooke, at this hour, according to firefighters, they are doing search-and rescue-operations. Now here is what we know about what happened. Firefighters were dispatched at about 9:30 this morning due to a gas leak. Once firefighters were investigating and evacuating the building, that is when an explosion collapse -- an explosion occurred. Excuse me. That is at about 10:07 a.m. And according to the mayor, it was felt across the city. Now that erupted into a fire. That fire is under control. And that caused the partial collapse of a building.

Now from local authorities, the latest that we know is that at least one person is dead, 17 others are injured. That includes six individuals in critical condition. And that includes one firefighter who is in critical condition at the hospital.

[14:50:03] As for the cause of this fire, earlier today, the city issued a press release saying there were contractors in the area using a boring machine and they hit a two-inch gas line. During the press conference that wrapped up moments ago, they said investigators are working on this and the fire marshal's office is involved and that all of this is still under investigation. They didn't give an exact cause of the fire. But, Brooke, there's search-and-rescue operations going on now. But according to sit officials, everyone has been accounted for -- Brooke?

BALDWIN: OK, OK. Keep your ear to the ground for us and if you have updates, we'll pop you back on TV.

Rosa Flores, thank you so much on what's going on there in Durham.

Ahead here on CNN, we'll take you inside this bizarre tour that President Trump took of George Washington's first home, Mt. Vernon. Hear the questions he asked, the criticism he had, and what he was most fascinated by. You don't want to miss this.

And breaking news. The party of Benjamin Netanyahu's opponent conceding the election officially in Israel. Did President Trump tip the scales?

(COMMERCIAL BREAK)

[14:55:35] BALDWIN: Some very different possible outcomes surfacing for the celebrities caught up in the whole college admissions cheating scandal. And it appears that Actress Felicity Huffman, who has apologized and entered a guilty plea, could face far less time behind bars than Lori Loughlin and her husband, who did not enter a plea. And this week, prosecutors brought charges new more serious charges of money laundering against Lori Loughlin. And CNN just learned Loughlin's attorneys never engage in substantial plea negotiations.

Let's talk about the difference in these two cases with CNN legal analyst, Paul Callan.

Paul, let's start with Lori Loughlin. She could face more than 20 years and that is just on the latest charges. Do you think the punishment fits the crime there, 20 years?

PAUL CALLAN, CNN LEGAL ANALYST: Well, no. I think 20 years would clearly not fit the crime. And I have to emphasize that, although that is the statutory maximum that she faces, in all likelihood her sentence would be far lower than that. Probably less than four years is my bet in the end. But that is the maximum that could be imposed by a judge.

BALDWIN: Got it.

And then when you look at differences between the two ladies, Lori Loughlin and Felicity Huffman, Huffman is accused of paying $15,000 for someone to fix her daughter's SAT answers. And Lori Loughlin and her husband are accused of paying half a million dollars in bribes to designate their two daughters as recruits to the USC crew team despite they didn't participate in crew. And, Paul, as a lawyer, can you weigh in on the different ways these actresses are handling their cases? Like we mentioned Lori Loughlin's attorneys never engaged in plea discussions. CALLAN: Well, I think, you're focused on the simple fact of the case

and the fact is you have to negotiate with the feds early on to get the best deal. And if you, through your attorney, approach federal prosecutors and indicate a willingness to take a plea and accept responsibility, you'll get a better sentence. Obviously, in this case, she did not do that. She waited. Maybe she made noise through her attorneys they would fight this and now she's facing a much more serious set of charges. This is classic behavior, by the way, of federal prosecutors. If you don't do a deal and you don't take a plea, they'll come down hard on you and that is the message being sent here.

BALDWIN: So if you are Lori Loughlin, do you prefer a jury trial or just a judge sentencing you?

CALLAN: Well, if you're going to fight it, you want a jury trial. Because in a jury trial, there are 12 people sitting on that jury, and if you even convince one of them of your innocence, that is a hung jury and that is not a conviction. So if you are going to go to trial, you clearly want a jury and not a judge to make the decision. On the other hand, should she still plead guilty hoping that a judge will be sensible enough not to say, I'll give her 20 years because she was late to plea, but maybe looks at the bottom end of the sentencing spectrum, which really would be less than four years. Remember, this ultimately rests in the hands of a federal judge, who will be comparing how other defendants similarly situated were handled in cases like this. So my bet is that, in the end, you'll see her take a guilty plea and you'll also see her get a much lighter sentence than the statutory maximum.

BALDWIN: Paul Callan, thank you.

We continue on. You're watching CNN. I'm Brooke Baldwin.

The attorney general has confirmed he is investigating the investigators in the Russia investigation. That is from Bill Barr on his second day of getting grilled on Capitol Hill, this time before Senators. What is more here, Barr said he thinks, quote, "spying did occur in the Trump campaign," without providing proof. And then later, he clarified his comment. We'll play that for you in a second.

But the attorney general continued to resist questions on the letter detailing his principle conclusions of the Mueller report. But Bill Barr did reveal that he did talk to the special counsel about why Mueller did not reach a conclusion on whether the president obstructed justice. And Barr added that Mueller did not tell him that he was leaving the matter up to Congress or DOJ. As for Barr's spying claims, this is what he said.

(BEGIN VIDEO CLIP)

[15:00:05] SEN. JEANNE SHAHEEN (D-NY): So you're not suggesting, though, that spying occurred?