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Baltimore Mayor Resigns Amid Book Deal Scandal; Trumps Fed Pick Withdraws After Sexist Remark Firestorm; Family of Stanford Admittee Paid Scam Mastermind $6.5 Million; U.S. Seeks Ways to Get Money to Venezuela's Guaido. Aired 3:30-4p ET

Aired May 2, 2019 - 15:30   ET



ERICA HILL, CNN HOST: Breaking news out of Baltimore. Where the city's mayor has just resigned. She's of course been on medical leave in a swirl though of controversy over sales of her children's books. Currently under investigation for possible misconduct. We want to go straight to Athena Jones, CNN national correspondent, who joining us from Baltimore with more. So any more details on this resignation?

ATHENA JONES, CNN NATIONAL CORRESPONDENT: Well, hi, Erica. I have a letter from Catherine Pugh, her resignation letter, we were just handed after this press conference that just wrapped up with her lawyer, Steve Silverman. All read to you from the letter.

It's brief, it says, in best interest of the people and government of the mayor and city council of Baltimore I'm writing to attest that effective immediately I hereby resign from the office of mayor to which I was duly elected on November 8, 2016. I am confident that I left the city in capable hands for the duration of the term to which I was elected.

Now of course, we had a lot of questions about what is now an ongoing investigation by state and federal officials.

[15:35:00] Her lawyer -- now former Mayor Pugh's lawyer did not take any questions. He did read a little bit more from the Mayor from a statement. He said, dear citizens of Baltimore, the Mayor is thanking the citizens of Baltimore, submitting her written resignation and apologizing for the harm she's caused to the image of the city of Baltimore and the office of mayor of Baltimore. She said, this city deserves a mayor who can move this city forward and she's also thanking Jack Young, the President of the City Council whose been acting mayor ever since she took a leave of absence starting at the beginning of April in the wake of these investigations.

And we're talking about hundreds of thousands of dollars that Mayor Pugh received from the University of Maryland Medical Center -- medical system -- while she was on the hospital's board for copies of her healthy children's book "Healthy Holly" UMMS paid the mayor $500,000. She also got money from Kaiser Permanente which provides health care to city employees and from a foundation, Associated Black Charities, that also does work with the city. These things are being investigated. And remember a week ago we saw a series of raids by the FBI and

criminal investigators from the IRS carrying out search warrants in multiple location as associated with the mayor, including two of her homes, the home of a former aide, also her lawyer's office was searched. So this is something that is ongoing. But this is been an issue now for over a month that she has been battling pneumonia and dealing with the city in a moment of real instability. This now provides some answers for Baltimore as it moves forward here -- Erica.

HILL: Athena Jones with the latest for us from Baltimore. Again, the mayor just resigning there. Catherine Pugh. Athena, thank you.

Meantime, another of the President's fed picks withdrawing after CNN uncovered sexist remarks Stephen Moore has made in the past. We have new details now on White House reaction.


HILL: President Trump's pick to serve on the board of Federal Reserve out. Stephen Moore withdrew his name from consideration after past sexist comments he made resurfaced. Cristina Alesci, CNN politics and business correspondent joins me now. So he said it was all about the attacks on him that were getting to be too much.

CRISTINA ALESCI, CNN POLITICS AND BUSINESS CORRESPONDENT: More like the facts on him were getting to be too much. Our own K-file -- one of our investigative units -- unearth writings that Stephen Moore had done about ten years ago that were clearly sexist. He said that women shouldn't referee men's basketball games. In fact he suggested women shouldn't even be present at those games. It just became too much for Republicans, members of his own party in the Senate, to back his nomination.

But the concerns about Stephen Moore go well beyond his sexist comments. If you go to the root cause of the controversy. Remember when he was potentially -- his name was potentially floated, conservative economists were questioning his credentials and the fact of whether or not he would be truly independent and not just a political sycophant for the President. So that was the main problem.

Now Democrats are having a lot of fun with this today. Chuck Schumer coming out and said, first Cain, which was the first nominee that dropped out because of allegations of sexual harassment that came back to haunt him, first Cain, now Moore. Thank goodness neither were actually nominated. The only thing less funny than some of Moore's tasteless, offensive, sexist jokes was the idea that President Trump would even consider him for a seat in the Federal Reserve. Now President Trump must nominate two serious candidates who will strengthen our economy.

Here's the thing that I'm looking forward to. Who will Trump nominated now that he had these two nominees basically lose the faith of his party? Will he actually go forth and pick someone who is confirmable, for lack of a better term, from the Senate. And hopefully that means a more independent nominee.

HILL: It'll be interesting to see who that person is. Cristina, always good to see you, thank you.

ALESCI: Absolutely.

HILL: A new twist in the massive college admissions scandal. Why one family paid more than $6 million to the alleged mastermind.


HILL: We are learning about another wealthy family now entangled in this college admission scandal. A source telling CNN the parents of a Chinese student who was admitted to Stanford University allegedly paid $6.5 million to Rick Singer. Just let that number sink in for a minute. $6.5 million. Paid to the man whose been called the mastermind of this scam.

Now it hasn't been determined if the student's parents were seeking an advantage with the payment. That's the largest reported so far. In a statement Stanford university says, quote, it is important to clarify. Stanford did not receive $6.5 million from Singer or from a student's family working with Singer. Stanford was not aware of this reported $6.5 million payment from the family to Singer until today's news reports.

CNN contributor, Frank Bruni is a "New York Times" op-ed columnist. He's also the author of "Where You Go Is Not Who You Will Be, An Antidote to the College Admissions Mania." We need one of those especially these days.

I mean, this is remarkable. So I just want to point out too that these parents are not among the dozens of parents who were initially charged a couple of months ago when all of this broke. We're just learning more about it. There wasn't sufficient evidence at that point. The investigators reportedly knew about them but they didn't charge them. But the number alone, the fact that someone paid $6.5 million to get their kid admitted to college, I mean, it leaves you speechless.

FRANK BRUNI, CNN CONTRIBUTOR: It is a breath-taking number. But it is a vivid illustration of just how much power we accord these colleges. Right. Other parents aren't paying that kind of money. But they're paying a lot of money for any advantage whatsoever just to have the magic of Stanford, the glory of Harvard.

We have so venerated and fetishized these schools you end up with this foreign couple coming up with $6.5 million. You're right they haven't been charged because it is unclear that they knew or thought the money was going to untoward things.

[15:50:00]I find it really hard to believe that they spent $6.5 million just thinking the essays would look prettier and be polished a little bit. I mean, when your showing --

HILL: And that that's what it would take with 6 1/2 million dollars.

BRUNI: Right. If you're paying that kind of money -- I mean, we'll see what happens. But I don't think I don't think it was innocent. HILL: It's really pulled back -- we're seeing so much about we know

that wealth and privilege and being well connected open a lot of doors, right? I mean you can't ignore that. And it used to be -- and we heard this so much in the wake of this first breaking news -- that you could have done it the old-fashioned way, just donate a building. But it is remarkable everything that we're seeing in terms of disparity. So how are schools responding? I mean, are you noticing a significant change in terms of the admissions process or even with the pledging they'll do?

BRUNI: Well it's too soon to notice the change in the process. But, yes, I'm noticing a change in what schools are pledging that they will do. You hit the nail on the head. The reason this story has captured people's imagination and their outrage, it's an example of privilege begetting privilege. Of wealth being used to perpetuate wealth and to make sure that you have an advantage over everyone who doesn't have that wealth.

What schools are pledging to do is look much more carefully at applications and at the student bodies there admitting. And to try to when their analyzing applicants say what is this person's accomplishment vis-a-vis his or her background and the advantages that he she did or didn't have.

Because where a low-income student is behind someone of wealth, is not just in the inability to donate a building or two pay $6.5 million. It's not having the sort of background where you know which sports are the most heavily recruited. It's not having tutors for the SATs. It not having what a lot of well-to-do parents do these days, the money -- hundreds of thousands of dollars -- to hire people from the very beginning to guide your child's every step, every decision, every course, every essay so that at that moment when the people at Stanford or Princeton look, they're like, wow.

HILL: Right. It is remarkable that you mentioned something. I know were almost out of time. But you talk about even not having the money for a SAT course. I remember getting to school and thinking how did your parents have the money? We couldn't afford a SAT guide course. I just got here on my own. And that's completely legal to help your children that way and there's nothing wrong with helping your child. But it certainly brings up a real moral question about how are you setting your family up and what lesson are you teaching.

BRUNI: The lesson you are teaching your kids and if you are one of those admissions officers when you are looking at this accomplishment, you have to put that accomplishment in the context of how much money was poured into that kid.

HILL: Frank, always good to see you. Appreciate it, thank you.

Up next, fast moving developments out of Venezuela. What the Trump administration is now considering to help the country's opposition leader.

[15:55:00] (COMMERCIAL BREAK) HILL: Turning now to breaking developments in the crisis in Venezuela. We are learning the uprising there this week has taken at least four lives. And now the U.S. is weighing new steps to get an influx of cash to Juan Guaido. He of course is the opposition leader being backed by the U.S. who admits his intended takeover did not go as planned.

Guaido is also President of the National Assembly. Said he could not declare victory because not enough military defected to his side.

Now the man Guaido is fighting to unseat, Nicolas Maduro marched with his military on the streets of the capital today stressing his army is, quote, united. CNN's Kylie Atwood joins us now with more including this latest move which the U.S. is considering. What more do we know?

KYLIE ATWOOD, CNN NATIONAL SECURITY REPORTER: Well, the Trump administration is very seriously looking at how they can further financially bolster Guaido right now. And that could potentially come in the form of cash. Sources are telling CNN. Now it's unclear exactly where that money would be coming from, but what the Trump administration could do would be to unleash, to free up, some of the Venezuelan assets that had been previously frozen and sanctioned by the U.S. government and feed that to Guaido and his supporters.

Now, the Trump administration has talked about how to economically revitalize Venezuela in the past. We've heard it from Larry Kudlow who said that there is an economic plan for Venezuela. But what's key here is the timing. This comes at a moment when Guaido is facing some opposition as he is trying to fight against Maduro. And it would be important if he were able to provide paychecks to members of the Venezuelan government or the Venezuelan military who are supporting him. And of course we have seen that members of the military are particularly key here. Because they have not supported Guaido as forcefully in as high numbers as he had hoped. And he just pointed that out yesterday.

HILL: And that's been key. I mean, as you point out, that's there because without that support, obviously it calls into question how much further he could go. Kylie Atwood with the latest for us. Kylie, thank you. We will continue to stay on that developing situation out of Venezuela.

Meantime a programming note for you. CNN's Anderson Cooper set to host a "TOWN HALL" with former FBI Director, James Comey. That will happen right here on CNN on May 9th, two years after President Trump fired him. Again, next Thursday night, 8:00 Eastern right here on CNN.

You may recall not too long ago he wrote an op-ed calling out Trump officials just in the last couple days, and we've been hearing more. So you will want to tune in to see that conversation between Anderson and James Comey. Again, two years since the President fired him. That will be happening only right here on CNN. There is much more to get to latest on not just the fallout over Bill Barr, and comments from Nancy Pelosi talking about a crime. But a new letter from Emmet Flood, reporting on that as well, is just ahead. "THE LEAD WITH JAKE TAPPER" start right now.