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U.S. Economy Adds 263,000 Jobs in April; White House Accuses Mueller of Playing Politics in Letter to Attorney General; National Security Team Meets at Pentagon to Discuss Venezuela; NYT: FBI Investigator Met Undercover with Trump Aide; Democratic Hopefuls Push Hard to Gain Support from Donors. Aired 9-9:30a ET
Aired May 03, 2019 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[09:00:12] POPPY HARLOW, CNN ANCHOR: All right. Good Friday morning, everyone. I'm Poppy Harlow in New York.
JIM SCIUTTO, CNN ANCHOR: And I'm Jim Sciutto.
We begin this morning with breaking news. Another big jobs report, the U.S. economy adding 263,000 jobs in April. The unemployment rate sinking to a 49-year low.
HARLOW: Wow. Lowest since 1969. Christine Romans with us more.
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Yes.
HARLOW: Stop numbers, strong top line number.
ROMANS: Yes.
HARLOW: Anything that gives you pause in this entire report?
ROMANS: It is a strong report and it shows that companies are hiring, aggressively hiring. When I look at the trend here, you can see we had a very strong January, February we were worried about the government shutdown and what that might have meant, but everything bouncing back here.
When you look at the unemployment rate 3.6 percent, these are generational low numbers and you've got some record lows for some different job categories and sectors as well, and strong hiring in business and information service, in construction 33,000 jobs there. And in watching manufacturing, I mean, if you want to really like look for something to be worried about, I mean, maybe look at manufacturing.
It lost 6,000 jobs last month and then this month had 4,000. On average during the Trump administration you have had 20,000, 20,000 plus. So I'm going to reserve another month or two to see if maybe there is a bit of a pause happening in this manufacturing recovery.
HARLOW: OK.
ROMANS: Because of the tariffs maybe biting, the cost of tariffs biting here. You know, if you -- look, at some point we're going to start running out of workers. We have seven million job openings right now. That's more job openings than people who are looking for jobs. So now you're going to start talking about where are we going to get more workers, how are we going to make sure we have the skills match of workers.
You know, the president has said this is a great economy. It is. I mean, the GDP number last week showed us, 3.2 percent GDP for the quarter was great. These jobs numbers are very strong jobs numbers which makes me wonder why the president would like to put more stimulus into the economy.
HARLOW: Right.
SCIUTTO: Right.
ROMANS: Those two ideas don't go together. This is a strong economy.
SCIUTTO: Yes. And fights economic policy in general.
HARLOW: Totally.
SCIUTTO: Right? I mean, you tend not to cut rates into what is already an economic boom. Right?
HARLOW: Yes.
SCIUTTO: There's no other way to describe it.
ROMANS: Well then, you're inviting a bust.
SCIUTTO: Right.
HARLOW: And you have less ammo when you do have a bust. Right?
ROMANS: Absolutely.
HARLOW: OK. So stay with us, Romans.
ROMANS: OK.
HARLOW: Let's bring in Douglas Holtz-Eakin. He's an economist for the conservative think tank, the American Action Forum. He's also a former economic adviser to the late Senator John McCain and the former director of the Congressional Budget Office.
Good voice, good brain to have with us this morning, sir. Thank you for joining us. Just to the point that Christine rightly brings up, so why, then, if this economy is so gangbusters and it's great news for the president, for all Americans, why then did the president tweet last week that the Fed should cut rates an entire percentage point? Last time they did that, 2008, middle of the crisis. Does that make any sense?
DOUGLAS HOLTZ-EAKIN, PRESIDENT, AMERICAN ACTION FORUM: I think Christine read the report very fairly. I mean, this is a strong report. You know, some numbers in there that are really worth looking at are the unemployment rate for people without high school diplomas, down quite a bit. Wage growth 3.2 percent, very strong. So we don't need additional monetary stimulus, it's not the right thing at this time.
SCIUTTO: What is the secret here? I mean, let's put up the long term trend line and it is true that this started many years ago at the base of the crash in 2008, but it has accelerated under the Trump administration. Why in your view?
HOLTZ-EAKIN: I think you can point to better productivity growth. The number we got yesterday 3.6 percent is the best number we've had in years. That's the core of being able to grow without inflation. That's, I think, attributable to the deregulation and the tax policies. Those are very strong pushes for the economy and for productivity. They've been tempered somewhat by the trade policies that aren't quite as good.
SCIUTTO: Yes.
HARLOW: You know, let me just bring up something that Christine just mentioned to me. This does not, though, display the pain of farmers across middle America. Right, Romans?
ROMANS: Yes.
HARLOW: These are nonfarm payrolls.
ROMANS: Right.
HARLOW: The "Wall Street Journal" had a really important report about a month ago about the record number -- in the last decade or so we're seeing a record number of farm bankruptcies.
ROMANS: Look, if you're in Wisconsin or you're in Iowa, or Illinois, or Nebraska, first of all, the Mississippi River and the Missouri River are flooding right now, so the most important story for you is what's happening there in your backyard but also you're just not seeing this kind of strength in farm prices, in farm income. And this is a nonfarm payrolls report. So this is showing all -- the other part of the economy, not the Ag sector.
And I'm wondering, Doug, do you think that could be a weakness for the -- it's "the economy, stupid" argument heading into 2020 if some of these places that went so strongly for Donald Trump, they are still suffering and in some cases suffering because, you know, the Chinese aren't buying soybeans because of his trade policy?
HOLTZ-EAKIN: Right. I think there is no question the president's trade policy has hurt the Ag sector. It is among our most internationally competitive sectors.
[09:05:02] It relies more on global trade and we've seen a big diminish in global trade so I would worry about that. If I was the president that is a core part of his political base and it's not doing very well right now. SCIUTTO: Let me ask you, you brought up a trade policy as it relates
to tariffs and many Republicans are saying that the president unless he removes steel and aluminum tariffs specifically.
HARLOW: Yes.
SCIUTTO: That his replacement for the NAFTA agreement known as USMCA is not going to pass Congress. Do you agree with that, one, and do you see this administration relenting on those tariffs to get it through?
HOLTZ-EAKIN: Those tariffs are a bad idea. I mean, I was in the Bush White House when he imposed steel tariffs. That was not good policy. It was ultimately ruled in violation of the WTO agreements. They had to go away. We are still seeing some of the retaliation from those tariffs now, it's lasted this long. So I think the Congress is right, those need to go away and they will -- they will say, you know, no USMCA without getting rid of them.
HARLOW: Yes. I mean, just naming off the Republican senators who are voicing those concerns.
SCIUTTO: Yes.
HARLOW: You know, usually big allies of the president.
Doug, before you go, this good jobs number is on top of a really strong economic growth number that we saw for the first quarter and that's great, 3.2 percent, but you know because when you dig into what's behind that 3.2 percent there are some numbers that at least gave me some pause, right, when you look at higher inventory, our businesses stockpiling.
HOLTZ-EAKIN: Yes. Yes.
HARLOW: When you look at domestic private sales, the smallest gain in three years. So is that economic growth number all it's cracked up to be?
HOLTZ-EAKIN: The first quarter was not as good as the top line. I mean, the household sector was especially week.
HARLOW: Yes.
HOLTZ-EAKIN: Durable goods sales fell at an annual rate of 5.3 percent. None of that gives me great comfort. So, you know, everything else is sort of looking pretty good, so every now and then you get a weird report and you can discount it, but I'm really looking forward to seeing the second quarter reverse some of those.
HARLOW: OK.
SCIUTTO: Christine, I'm just curious because you speak to a lot of folks, economic forecasters, et cetera. When they look at those weird numbers, even that may fight the top line number, do they see signs of a weakening in the overall trend or no? ROMANS: Well, no, I mean, they're surprised that they didn't get more
of a slowdown beginning of the year than they thought. I mean, I ready do think that the strength at the beginning even with some of these anomalies the overall strength surprised many of them. They thought that things were going to cool down a bit and they just haven't yet. So the question is, what kills a 10-year bull market or a 10-year economic expansion. And if you've got the Fed on the sidelines, the path of least resistance really is just moving along like this for the next year or so.
SCIUTTO: And generally, let's be honest, folks are really bad at predicting the end of --
(LAUGHTER)
ROMANS: I know.
SCIUTTO: Term cycle.
ROMANS: We'd all be on a --
HARLOW: Yes. We wouldn't be sitting here if we could do that.
SCIUTTO: Christine Romans, Douglas Holtz-Eakin, thanks very much.
HARLOW: Thank you.
SCIUTTO: In Washington this morning the field of witnesses whom House Democrats want to question under oath and who cannot or will not be stopped by the president is as small as it has ever been. Overnight the president put to rest any lingering hope among Democrats that his former White House counsel Don McGahn might honor a subpoena from the House Judiciary Committee.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I've had him testifying already for 30 hours.
UNIDENTIFIED REPORTER: So is the answer no --
TRUMP: And it's really -- so I don't think I can let him and then tell everybody else you can. I would say it's done.
UNIDENTIFIED REPORTER: Over.
TRUMP: We've been through this. Nobody has ever done what I've done. I've given total transparency. It's never happened before like this.
(END VIDEO CLIP)
SCIUTTO: Well, there is historical precedent, but anyway, McGahn's 30 hours of testimony to the Mueller team resulted in more than 150 mentions in Mueller's final report. He is on the record saying, among other things, that the president ordered him to have Mueller removed and later ordered him to deny that. So now if he wasn't already the special counsel himself Robert Mueller
is the biggest possible get for House investigators and his report we now know White House lawyer fired off a scathing letter to the attorney general claiming that Mueller overstepped his mandate and produced, quote, "a law school exam paper." That letter came one day after the redacted Mueller report was released.
CNN's Lauren Fox is on Capitol Hill this morning where Democrats are still seething over the attorney general's testimony and his testimony a month ago and his lack of testimony yesterday.
Lauren, I mean, Nancy Pelosi is flat-out calling him a liar.
LAUREN FOX, CNN POLITICS CONGRESSIONAL CORRESPONDENT: Well, that's right, Jim. What a week it has been on Capitol Hill when it comes to the Attorney General Bill Barr. He testified before the Senate Judiciary Committee on Wednesday where Democrats grilled him over his handling of the Mueller report. Then on Thursday he was a no show before the House Judiciary Committee because of a disagreement with Committee Chairman Jerry Nadler over the format of that committee hearing.
Nadler wanted staff lawyers to be able to question Barr. The Justice Department said that that was not going to happen. And then the Justice Department missed that deadline to turn over the unredacted Mueller report on Wednesday. All of this coming to a head yesterday with Nancy Pelosi essentially calling the attorney general of the United States a liar during her press conference and then "The New York Times" reporting that in a private meeting Nancy Pelosi said that the attorney general is simply a lap dog for the president.
[09:10:04] So where do we go next? Essentially Jerry Nadler, the chairman of this committee, has threatened that if he cannot get the unredacted Mueller report in his possession he will move forward with contempt against the attorney general of the United States, William Barr. That's where we're headed. That's a lot to look forward to next week -- Jim and Poppy.
HARLOW: OK. Lauren, we will be looking forward to it all. Thank you very much.
Let's talk more about this with former federal prosecutor and CNN legal analyst Shan Wu.
Good morning to you, Shan. So many questions, but let me just read you part of the White House attorney Emmet Flood's letter which it is notable that it came out a day after the redacted report was released and here's he writes that Mueller needed to, quote, "either ask the grand jury to return an indictment or decline to charge the case." He goes on to say, "The special counsel instead produced a prosecutorial curiosity, part truth commission report and part law school exam paper."
What's the play here with this? Why do this? Why keep changing strategies, first Mueller is honorable and this is great for us, and now they're mad about what the form this took? SHAN WU, CNN LEGAL ANALYST: I think the reason for the change in
strategy is probably they got a look at what was in the report and realized that it was very damaging even though he had not chosen to reach a final prosecutive decision about obstruction. And so that was part, I think, of the kind of lawyer aspect of wanting to downplay the report and question its integrity and authenticity.
It's unfortunately -- he calls it, I think, a prosecutorial curiosity and of course it is a very unusual situation, so it's not like their normal reports like this and it's quite clear that you can defend Mueller's interpretation of what he was supposed to put forth because he did do a declination memo. He put out all the evidence and he said he wasn't reaching a decision and he put that out for the attorney general to look at. So that seems perfectly proper.
SCIUTTO: What about, Shan, another interpretation of this, that what Bob Mueller -- and it's not my original idea, a lot of folks have theorized this, that he was basically presenting the evidence to Congress and saying, Congress, it's up to you. You know, you have as a co-equal body, a course of action here, if you so choose to do so which would be to impeach and here is the evidence as I found it. Do you interpret -- do you believe that that was Mueller's intention in effect to say it's Congress' call?
WU: I think it's hard to know if that was his intention because he failed to make explicit what his intention was. He certainly would have been well aware of the historical precedent, the so-called Watergate roadmap, and he also did say that he wanted to make sure that they preserved the evidence for the future and that is what he did and I think knowing what I do about him a little bit, having known and worked with him, I think he had a pretty narrow focus and he felt he had to preserve that evidence and then whoever was going to do whatever with it, that wasn't going to be his issue, but he would make sure he did his job and got all the evidence out there.
HARLOW: Can we talk about Don McGahn and what he is going to do? Because he sat for 30 hours of testimony before Mueller's team. He is mentioned 150 times in the Mueller report and now the president saying, no, I don't think he should be allowed. I'm not going to allow him to testify. A, didn't he already give up that right by waiving executive privilege for McGahn to talk to Mueller, but B, McGahn doesn't work in the White House anymore so does it matter if the president wants him to testify or not? Does he have any control over that?
WU: It's a little bit of a complicated question. I think the White House will have a legal argument to make that they still may possess the privilege and they are obviously arguing as Flood already put out there that they didn't waive it even though he testified to that. So on that point it's a little bit nuanced of a legal argument. My view of it is courts are reluctant to say there's a blanket waiver. If you make one statement which is an arguable waiver that that eliminates your entire privilege.
And here's a little bit more complicated because there's some constitutional issues, too, but there are very strong arguments on both sides that, A, you just can't completely waive it and, B, that he did waive it. On a personal note for McGahn, if I was advising him, I'd certainly tell him you better show up and testify. And if I was speculating about him with a crystal ball, I mean, he seems like a lawyer who has a conscience, he's concerned about his professionalism, maybe his bar license, and he wanted to be truthful with Mueller's team. So I don't think he's going to take it upon himself to defy Congress at this point.
SCIUTTO: Did you just say a lawyer with a conscience, Shan? Did I hear that correctly?
HARLOW: They exist.
WU: I'm standing up for all lawyers today. We all have conscience.
(LAUGHTER)
HARLOW: I'm the daughter of a lawyer. I'm in your camp.
SCIUTTO: I know. I have a lot of friends.
HARLOW: Shan, thank you. Appreciate it.
WU: You're welcome.
SCIUTTO: Still to come, "The New York Times" reporting that the FBI sent an undercover investigator to meet with then Trump campaign aide George Papadopoulos. Is this one of the FBI's moves that the attorney general says he is now investigating?
And the crowded field of Democratic candidates now stands at 21 and with that a high stakes battle for cash from donors. We will be live from Iowa.
[09:15:06] Plus, this is just in to CNN, the National Security team including acting Defense Secretary Shanahan and National Security adviser John Bolton just held a high-level meeting at the Pentagon to discuss a situation in Venezuela, including possibility of military option. We're following all of this.
(COMMERCIAL BREAK)
SCIUTTO: This morning, new details are emerging about a meeting involving a former Trump campaign adviser and an undercover investigator for the FBI. The "New York Times" reporting that just two months before the 2016 presidential election, George Papadopoulos met with a woman who was posing as university research assistant, but unknown to him at the time, she was actually working for the FBI.
And during the meeting, the woman asked Papadopoulos whether the Trump campaign had been working with Russia. Joining us now is Mark Mazzetti; Washington investigative correspondent for the "New York Times", he co-authored that report.
[09:20:00] And Josh Campbell; he's a former FBI supervisory special agent. Mark, to begin with you, it's your reporting here. So we already knew that Papadopoulos had met a Cambridge professor who was -- who turned into a confidential informant in effect. We did not know that the FBI had someone there. Tell us what you know.
MARK MAZZETTI, WASHINGTON INVESTIGATIVE CORRESPONDENT, THE NEW YORK TIMES: Right, so in September of 2016, this guy Stefan Halper reaches out to Papadopoulos, he is a Cambridge University professor, he's also worked as a confidential informant for some time with the FBI.
He tells Papadopoulos, he wants to meet him in London and that he wants him to author a study about energy issues in the Mediterranean. When Papadopoulos arrives, he first meets a woman he had met who was -- who he knew as Azra Turk. We're reporting that this woman, we don't know her real name was actually sent by the FBI to gather information and kind of oversee the whole process with Halper.
Someone who is directly more involved with the U.S. government and potentially to gather evidence, even to testify in court if need be. So it was someone to sort of control the operation and sort of shows the extent, the alarm inside the FBI at this period in time.
SCIUTTO: Josh Campbell, you say this is evidence the FBI was doing its job. Tell us why you believe that.
JOSH CAMPBELL, FORMER FBI SUPERVISORY SPECIAL AGENT: Well, and I think it's important to distinguish I'm reacting to this reporting, not based on anything, you know, I learned when I was in government, it's important to point that out.
SCIUTTO: Understood.
CAMPBELL: But if you look at what this reporting states, I mean, this is standard operating procedure for any FBI investigation. Undercover operations, the use of informants, these are investigative tools that help the FBI go places that they cannot go themselves. An FBI agent trying to get to the bottom of a string of bank robberies for example or a terrorist group.
And yes, even a campaign for president that has, you know, these suspicious ties to a foreign adversary. An FBI agent can't just announce themselves and start asking questions. So you're going to use these tools that help, again, the FBI go where it can't go on its own --
SCIUTTO: Right --
CAMPBELL: It's important to point out, and I've heard the president, you know, this morning, he's already tweeting about it, but he's calling this spying and his allies will say this is abuse. These types of operations are highly scrutinized inside the Justice Department and there's oversight.
So, you know, this will be -- we're going to see politics come out of this, but it's important to keep that in mind, these are tools the FBI uses every single day.
SCIUTTO: Well, listening to Barr's testimony earlier this week, he said very openly that he has ordered his own investigation as to how this original counterintelligence investigation began during the 2016 campaign. I want to play those comments here, and then ask your view on how far this will go. Have a listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The scope of the OIG, where does -- do you understand or do you know what the scope of that report will be?
WILLIAM BARR, ATTORNEY GENERAL, UNITED STATES: Well, I don't want to be too specific. I talked to Mike Horowitz a few weeks ago about it, and it's focused on the FISA, the basis for the FISA and the handling of the FISA applications. But by necessity, it looks back a little bit earlier than that.
(END VIDEO CLIP)
SCIUTTO: OIG is referring to the Office of the Inspector General, but Barr also made clear in the testimony, he has his own investigation he's opening. Mark, you've been covering this a long time. How significant could this investigation be? Could it lead to the possibility of criminal referrals for oversteps during the start of this investigation?
MAZZETTI: I mean, anything would certainly be possible. We know that the Inspector General is digging into this issue, we expect that he's going to have some kind of report in the next couple of months. And as the Attorney General said, they're very focused on this issue of the FISA, the predicate for the FISA for another adviser, Carter Page.
But they're looking at the predicate for the whole operation, the whole counterintelligence investigation. The Papadopoulos story is certainly interesting because at that point, recall it was the reason -- Papadopoulos was the primary reason they opened it in the beginning --
SCIUTTO: Yes --
MAZZETTI: Because he talked to an Australian diplomat about the Russians. And so his role is quite interesting in terms of the back story and what the FBI wanted to know. But as we now know, he didn't have the goods on some real direct link with the Russians.
SCIUTTO: Josh, there are legitimate questions here, are there not as to what is the standard that the FBI or other U.S. law enforcement can deploy resources like that to look at someone, an American citizen, mind you, participating in a presidential campaign. I mean, what is the standard that would allow that decision to be made?
CAMPBELL: Well, as I mentioned, something like this would have high level oversight, high level scrutiny. One thing I think is important to point out is that, you know, I watched the Barr hearing as we all did, and it's interesting that the framing here from the president's allies seem to be that an FBI -- that an investigation into the FBI is somehow punitive or pejorative. I think in my own judgment that that's actually a good thing. We need to get to the bottom of exactly what happened because I think that will help the American people determine what's politics and what's reality, and having that independent inspector general do that work is important.
[09:25:00] I've talked to people inside the FBI who think that this will vindicate them, you know, finally here, lay out the facts, let us show you what we did when faced with this situation. So this framing that this is somehow negative I think is you know, is wrong. The problem that I think we all -- that I have, and that we all need to be focused on is that, even though the Inspector General is independent, if it passes prologue, we can expect the politics to continue.
All you have to do is look at the Inspector General's review of the FBI's involvement with the Hillary Clinton case, that came out and said that there was misbehavior, but it didn't impact any investigation. Yet, we continue to hear to this day the president beating that drum that there was this corrupt --
SCIUTTO: Yes --
CAMPBELL: Cabal that was trying to help Hillary Clinton and take down him. So we're going to get the facts, we're going to know what happened, but again, I have no -- I'm under no illusions that the president and his allies will accept a conclusion that says that the FBI, you know, did something right. I think they're going to continue all the way through --
SCIUTTO: Right --
CAMPBELL: Twenty-twenty, trying to paint the president as a victim.
SCIUTTO: OK, well, we'll see what the results of the investigation are. Mark Mazzetti, Josh Campbell, thanks very much.
POPPY HARLOW, CO-HOST, NEWSROOM: Really important, really interesting, got the president's attention this morning for sure. All right, ahead for us, a mad dash for donors. Democratic hopeful Senator Kirsten Gillibrand even playing beer-pong with water, I should note.
SCIUTTO: Oh --
HARLOW: To try to raise more money, you know, it's still fun, right? And to snag a place on the primary debate stage by getting enough donors. What are other Democrats doing?
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[09:30:00]
