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Rep. Sylvia Garcia (D-TX) is Interviewed about Escalation between Trump and Democrats; Trade Talks with China; North Korea Launched Missiles. Aired 9:30-10a ET

Aired May 9, 2019 - 09:30   ET

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


[09:30:00] POPPY HARLOW, CNN ANCHOR: Nadler, quote, refused to postpone to allow additional time to explore discussion and compromise.

Was the Department of Justice trying to reach a compromise with your committee and were Democrats unwilling to compromise?

REP. SYLVIA GARCIA (D-TX): Well, I'm not sure they ever really worked with the committee in good faith. It took months, in fact about two months to even open up any discussions because they had initially refused. Then they began discussions. There were offers, counteroffers and then they just arbitrarily cut it off. So it's not that Chairman Nadler decided to act earlier than he should, it's that they cut it off. There's nothing you can do with someone who changes the goal posts, who does counteroffers, and then ultimately says, well, we don't want to talk anymore and we're not going to produce him, produce the documents, we're not going to let anyone else appear or respond to subpoenas. That's not acting in good faith.

We had no choice. We were forced to do this.

JIM SCIUTTO, CNN ANCHOR: It's in the polling numbers that many Americans are running out of patience with these investigations. A recent poll, 44 percent of the country now, and this is up from 38 percent, and I'll just read the numbers since you don't have the advantage of seeing this, but 44 percent of the country says Democrats are investigating Trump too much, a little less -- well, a little more than half of that believe they're doing the right amount.

I wonder if you're concerned that you're losing the political appetite for these investigations and that that will hurt you and your colleagues in the next election?

GARCIA: Well, I think we discussed that the last time I was with you and I think there are -- you know, there is a factor of that, that we have to consider. But I think what's important is that this really is not about the polls, it's not about politics, it's not even about this one president, it's about our democracy, it's about the check and balance, it's about the way our entire system works.

If we had everyone start ignoring subpoenas that they got in any court at any level, what would happen to our justice system? What would happen to due process? What would happen to our way of governing? So I think we need to look at the big picture and I really cannot

focus just on a poll. We've got to look at the whole thing.

HARLOW: Congresswoman, I'd like to switch gears to immigration and get your response to an interaction that the president had last night. He was holding a rally in Florida, in the panhandle. And this comes, you know, a day after the horrific Colorado school shooting and a week after the shooting at UNC-Chapel Hill. Here is what the president said when someone in the crowd at the rally thought it was funny to make a joke about shooting immigrants.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I mean when you have 15,000 people marching up and you have hundreds and hundreds of people and you have two or three border security people that are brave and great -- and, don't forget, we don't let them and we can't let them use weapons. We can't. Other countries do. We can't. I would never do that. But how do you stop these people? You can't. There's --

AUDIENCE MEMBER: Shoot them.

TRUMP: That's only in the panhandle you can get away with that statement.

(END VIDEO CLIP)

HARLOW: So what you heard there is someone said "shoot them," and he sort of, you know -- he didn't say, no, no, no. How should he --

SCIUTTO: (INAUDIBLE) --

GARCIA: Well, you know, I just think it's horrible. I just think it's horrible when the president of the United States does not do something to try to stop that kind of discussion and, in fact, almost seems to encourage it. You know, we need more civility in this country and it begins at the White House. And what he did today was frankly shameful.

SCIUTTO: Congresswoman Sylvia Garcia, we appreciate you taking the time this morning.

GARCIA: Thank you so much for having me.

HARLOW: Of course.

All right, American and Chinese negotiators scrambling today to try to reach some sort of agreement just hours before significant new tariff hikes kick in. What happens if they can't reach a deal?

SCIUTTO: And be sure to watch CNN's special "AC 360" town hall with the former FBI director, James Comey. It will be live from Washington. Our colleague, Anderson Cooper, moderating starting at 8:00 Eastern Time only on CNN.

(COMMERCIAL BREAK) [09:38:53] HARLOW: All right, another round of those trade talks between the U.S. and China getting into swing today. Look at the market, jittery over this, the Dow off 200 points just hours before the administration is set to hike those tariffs on $200 billion worth of Chinese goods up to 25 percent.

SCIUTTO: So China is now threatening to retaliate, but the president still doubling down on his claims that this is all China's fault.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: By the way, you see the tariffs we're doing, because they broke the deal. They broke the deal. They broke the deal.

So I just announced that we'll increase tariffs on China. Now, we won't back down until China stops cheating our workers and stealing our jobs. And that's what's going to happen. Otherwise, we don't have to do business with them. We don't have to do business. With could make the product right here if we have to, like we used to.

(END VIDEO CLIP)

SCIUTTO: Not clear that's actually true.

Anyway, negotiators scrambling to resurrect a potential deal. If not, those expanded tariffs will slam several U.S. industries, such as soybean farmers, car makers, medical equipment manufacturers. And to be clear, that extra cost passed on to you and me. We pay more for the stuff because there are tariffs on them.

[09:40:03] HARLOW: That is exactly right.

Let's bring in Douglas Holtz-Eakin, an economist with the conservative think tank Action -- American Action Forum. Also a former economic advisory to the late Senator John McCain and former director of the CBO.

So, sir, the president keeps selling this to the American people. And, look, China is doing a lot of bad stuff that's bad in terms of, you know, transfer -- trade transfers, et cetera. But my point here is, the president keeps saying we, as a country, are getting all of this money from these tariffs. Here he was just in February making that point.

DOUGLAS HOLTZ-EAKIN, FORMER DIRECTOR, CONGRESSIONAL BUDGET OFFICE: Yes, well, the tariffs --

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: China's paying us right now billions and billions of dollars of tariffs a month. Every month, billions of dollars. I love it. Personally, I love it.

(END VIDEO CLIP)

HARLOW: That's not how it works, is it?

HOLTZ-EAKIN: No, those tariffs are paid by the American people. There's no question about that. And my concern about the next round of tariffs is, these were constructed to be relatively modest at the beginning, not very disruptive. As he escalates, we're going to hit more products that are important to the American economy, the impact's going to be larger. If you think about what he's proposing, it's raising $30 billion in tariffs right now in the second quarter. That's like having $120 billion tax increase each year. I don't think anyone would argue that's a good thing for the U.S. economy.

So they've ended up in a position where legitimately they want to get China to reform its trade practices, I don't think anyone disagrees with that. But the only tactical approach they have is tariffs.

SCIUTTO: Right.

HOLTZ-EAKIN: And so that's not a great position where all you can do is inflict harm on yourself to get a deal.

SCIUTTO: Does the president not know that tariffs are actually paid by the American people, or is he comfortable sharing a falsehood and repeating a falsehood?

HOLTZ-EAKIN: I don't know the answer to that, but it certainly isn't correct what he's saying and it's certainly not the case as he has repeatedly said that tariffs are good for the U.S. economy. They are the reason that we've had stronger economic growth. There are other reasons to have that growth, things he's done, tax policy, regulatory policy, the tariffs have hurt that, and they've taken away from what would otherwise be an even stronger economy.

HARLOW: Let me ask you about this hitting the president's base, namely farmers. Not included in the jobs report is the pain the ag sector is feeling, and farmers are feeling. Farmer income has dropped 50 percent since 2013, accelerating under the president. "Politico" had a fascinating piece this week that pointed out that a handful of economists at the Ag Department left because they felt like they were being retaliated against by the administration for putting out reports showing that these policies, like tariffs, are hurting American farmers.

Do you expect these trade policies, additional tariffs, to really hurt the Midwest, the heartland, and these farmers even more?

HOLTZ-EAKIN: Well, certainly the U.S. agricultural sector is one of our most internationally competitive sectors. So that any time we get into a situation like this where we have tariffs on China or previous to this on steel and aluminum, the retaliation is against those parts of the U.S. economy that are most affected internationally. That's what countries do, they protect themselves against effective (ph) competition. So it's not just the tariffs, it's the retaliation that's going to hurt the farm sector.

And this is not a mystery. The president and the administration acknowledged it pretty openly by going to this old commodity corporation created in the depression to get some money for the farm sector to offset the impact of the tariffs in retaliation. This just raises the stakes even higher. This is not good news for the American farm sector.

SCIUTTO: Douglas Holtz-Eakin, thanks very much.

Other news we're following, North Korea fires more missiles, the second launch in less than a week. What does that mean for the future of U.S. negotiations with the U.S.? Are there any substantive talks?

(COMMERCIAL BREAK)

[09:48:30] HARLOW: All right, so, this morning, South Korea says they believe the North has launched two short-range missiles and the South Korean president says the country may have done that out of dissatisfaction over the failed denuclearization summit with the U.S. in February.

Now, this latest launch comes just days after North Korea test fired several weapons systems as part of a strategic drill.

SCIUTTO: Pyongyang describes the test fire as routine and self- defensive in nature. All of this complicating, to say the least, inter-Korean relations, negotiations with the U.S. South Korea saying today it's very nervous about these latest launches.

Joining us now, CNN national security analyst and "New York Times" national security correspondent David Sanger.

So, David, big picture, there's been no denuclearization of North Korea. That hasn't happened. But the president has touted two things, end of missile tests and to nuclear tests, and the transfer of remains of U.S. MIAs from the Korean War.

That transfer is now off and North Korea is again testing missiles. What does the U.S. have to show for these negotiations?

DAVID SANGER, CNN NATIONAL SECURITY ANALYST: Well, not very much, Jim. And the reason they don't have much to show is that beyond the initial Singapore agreement of sort of general discussion of denuclearization, there's been no specificity since last June. Bill Clinton got more out of the North Koreans in 1994 when they agreed, for a number of years, to freeze their production of nuclear material. Where President Trump is today is that the North Koreans are still producing nuclear material. The intelligence community believes they are still producing nuclear weapons.

[09:50:04] The two things that have improved is that they're not doing nuclear tests right now and they're not doing long-range ICBM tests. And right now you have the administration saying, well, don't pay that much attention to these tests that you're hearing about because they're all short-range, which they are, so they don't really affect us. Well, they don't affect us, but they certainly affect our allies, South Korea and Japan, and the American troops that are based there.

SCIUTTO: Treaty allies, no less. So, anyway, something to be concerned about.

SANGER: That's right.

HARLOW: Yes.

You know, David, I just find it also interesting that in the past few weeks, some of the president's closest advisers on national security have said publicly on, you know, TV that they think a third summit with Kim Jong-un is possible, might be a good idea, could move things forward. Seeing what you see now with these and the warning from South Korea, would that be advisable? Would you advise the president to do a third summit?

SANGER: Well, you know, Poppy, I've always thought that the summits -- the initial summit was a good idea because we had spent, what, 30 years trying to deal with lower level North Korean officials who don't have the authority to make a decision. And so the thought that meeting the only person in North Korea who can make a decision was a good one.

That said, you have to go into a summit with two things, very rigorous preparation, which the president did not do the first time, and a pretty well precooked deal, which he didn't do the second time. So you've had, you know, an initial get to know you meeting and then an abject failure, although the administration tried to portray it that everybody left on good terms.

The fact of the matter is that the North Koreans right now see no particular advantage in giving up anything, particularly if they have a president in place who they don't think is going to, between now and the election, ruin this image of having brought about a good relationship with the North.

SCIUTTO: That sounds like North Korea's playing Donald Trump.

SANGER: They are playing Donald Trump, Jim, and they're playing him very skillfully.

And you know what's really interesting is, look at what the Iranians did yesterday and what the North Koreans did today. Both of them are doing very finely calculated, calibrated provocations that are meant to say, if you don't go our way, this could get a lot worse. And they're waiting to see how President Trump reacts to that.

And the oddity is that in the North Korean case, he's likely to say, that's OK. The most important thing is a relationship. And, in Iran, I think there's a very good possibility this could veer out of control.

HARLOW: So, David, just on the Iran point. We've just learned, in the past few seconds, that secretary of State Mike Pompeo is returning to the U.S. early for a meeting at the White House about Iran. Significant?

SANGER: So there is a principles meeting set for today on Iran. We were told yesterday that Pentagon officials want to lay out pretty clearly to everybody, including the president, what the cost of an actual confrontation with Iran would be, because they're a little bit afraid that the rhetoric has gotten out of control.

What's most notable, Poppy, was that yesterday the message control out of the White House and the rest of the administration was pretty poor. Mr. Pompeo started off by saying that the announcement by the Iranians was pretty insignificant. He ended the day with a pretty fiery response. And then you had people at the Pentagon saying, let's not let our rhetoric get out of -- ahead of military off ramp here so that the Iranians don't get backed into a corner. So they need to get -- they need to get their act together a bit.

SCIUTTO: You've got to have a plan. You've got to have an end game. These things can escalate and you could end up in military conflict.

HARLOW: Yes.

SCIUTTO: David Sanger, always good to have you on.

SANGER: An accident can happen.

SCIUTTO: Yes.

HARLOW: Yes.

SANDER: Great to see you.

HARLOW: Always good to have you, David.

[09:54:03] So the president's son not happy about that -- that Republicans on the Senate Intelligence Committee are demanding that he come back to testify again on Capitol Hill. So what will Don Junior do?

(COMMERCIAL BREAK)

[10:00:01] HARLOW: All right, good morning, everyone. Top of the hour. I'm Poppy Harlow.

SCIUTTO: And I'm Jim Sciutto.

We are watching one of several fronts in a constitutional showdown at least, what some are calling.

END