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Pelosi: Trump Obstruction, Coverup "Could Be Impeachable Offense"; Trump Declares He Can't Work with Democrats Until Investigations End; Rep. Ruben Gallego (D-AZ) Discusses Trump Obstruction; Impeachment; Infrastructure Legislation, Mueller Report; Avenatti Charged with Stealing Money from Client Stormy Daniels; IRS Memo Contradicts Mnuchin's Reasons to Hold Trump's Taxes; N.Y. Lawmakers Pass Bill to Get Trump's State Tax Returns to Congress; Feds: Man Who Wanted to "Bomb Trump Tower" Arrested. Aired 2:30-3p ET

Aired May 22, 2019 - 14:30   ET


[14:30:00] NADEAM ELSHAMI, CNN POLITICAL COMMENTATOR: You have to take a step back and remember, as speaker, she is unflappable.

You know, the president expected to get a reaction from her and from Democrats after today's action by him. But it's not what he expected. He didn't think she would get up there and say, you know, the president just walked away from infrastructure. The president doesn't want to do this because he doesn't have a plan. That is not the reaction he expected.

He expected Democrats to come in and say, oh, my goodness, the president just said this and he's really concerned about a word that she said, we're going to impeach. No.

They have a plan going forward. The committees are going forward. And the methodical way the becomes have been moving, with the chairman and the speaker and the leadership and with the members.

Look, the meeting that happened today, that was a caucus meeting. They have these discussions often. And the president was going to use it as an excuse to cancel the meeting and do his press conference --


ELSHAMI: Go ahead.

BALDWIN: But just to your point on how at least we saw Speaker Pelosi reacting, standing there with Leader Schumer. She chose not to throw down the rhetorical hammer. Not to say other Democrats, I'm sure, will.


BALDWIN: She chose to kind of hold, right. Instead, talked about President Thomas Jefferson and Teddy Roosevelt.

ELSHAMI: That's right.

BALDWIN: And what Trump could have done, and the jobs that he could have created.

And just I wanted to get your reaction to her choice of language. She said, "I pray for the president of the United States." Now I'm from the south and we say, bless your heart, and that is a veiled insult. Can you translate "I pray for him" for me?

ELSHAMI: Yes, she does. She does. She prays.

BALDWIN: She does?

ELSHAMI: Absolutely. I believe she does. And she cares for the country and she cares for the president and she cares for the issue.

See, the difference between the speaker and the president, in this particular instance, right, in the instance of governing, the Democrats feel they have a responsibility, a duty to get some things done. Right. And it is not about the politics of it. Oversight is important and must be done and has to get done.

Infrastructure, for example, was something that they have been talking about from day one, even when I was there.

And the reason -- the reason she always goes back to history and refers to it, and telling the president, look, you, Mr. President, President Trump, could actually have your name associated with some of the greats in this country in rebuilding it. And she's willing to give him this opportunity. And Democrats are willing to give him this opportunity.

But, you know, he doesn't know what she's going to do next. No one really knows what she'll do next.


BALDWIN: Do you know what she'll do next. Quickly. I know you say she's unflappable. You don't think this will get her there, what happened today?

ELSHAMI: No. Absolutely not.


ELSHAMI: I think she's going to play it right and she's going to lead the Democratic Party in the right direction.


Nadeam Elshami, thank you very much.

ELSHAMI: Thank you so much, Brooke.

BALDWIN: Democratic Congressman Ruben Gallego represents Arizona and is a member of the Armed Services Committee.

Congressman Gallego, thank you for being with me.


BALDWIN: The President Trump said it this morning from the Rose Garden, not one single thing will get done in Washington, D.C., until your party stops investigating him. What is your response?

GALLEGO: I'm not surprised. This president has never really been up to snuff to be president or act presidential. He's putting his personal animus toward the investigations over the country.

This infrastructure package is desperately needed. It would be helpful both to him politically but, more important, to everyday Americans and he is just too immature to deal with the fact that everyone can walk and chew gum here in Washington, D.C.

BALDWIN: Did the president just give you a reason to start impeachment proceedings?

GALLEGO: No. My opinion, I'm waiting on -- to hear from two people, Don McGahn and Mueller. And obviously, for some reason, they are not allowed to speak to us, then I'll move forward with inquiry of impeachment, not articles of impeachment.

Again, the president -- none of us should be surprised how this president acts. We should be surprised, however, that it is going to affect millions of Americans that could benefit from the infrastructure package.

BALDWIN: Do you think on infrastructure -- because they had to figure out how to pay for it, right. And do you think the president needed a way to wiggle out of the infrastructure deal? We know Mulvaney wanted it dead. Do you think that is what drove him to do what he did today?

GALLEGO: I would hope not. That is such a teenage way to deal with a problem instead of just being honest with the American public and leading his Republican colleagues to actually come up with a compromise. But then again, his temperament is not necessarily very suited for this job.

BALDWIN: How about just how do you think -- do you think that one side will need to soften? I mean, you have this disaster aid bill this week, there are so many things on the docket, legislation needs to happen and government needs to work. You can't have both sides not working because the president says I'm not working with you unless X, Y and Z. So who blinks?

[14:35:10] GALLEGO: To begin with, we'll continue working with Republicans here in the House and the Senate. And we're going to abide by the Constitution of the United States as part of our oversight of the executive. So we're not going to stop doing our job because we're -- they're going to hold legislation hostage. That would make our founding fathers roll over in their graves. And we'll continue to do this.

And if the president decides to hold millions of Americans hostage that need some disaster relief, or that they want to benefit from the infrastructure package, he has to answer to the public in 2020. But in the meantime, we have a duty, that we all swore to uphold the

Constitution of the United States and we'll continue doing that and that is by continuing to have oversight over the executive.

BALDWIN: Congressman Gallego, thank you very much.

GALLEGO: Thank you.

BALDWIN: More news just in. New York lawmakers passing a bill that would make it easier for Congress to get the president's state tax returns.

Plus, a scary development. The feds arresting a man accused of wanting to, quote, "bomb Trump Tower." Stand by for those details.


[14:40:41] BALDWIN: We are back. We have some breaking news involving Michael Avenatti.

Let's go straight to our correspondent, Sara Sidner, with the latest.

Sara, what is the story?

SARA SIDNER, CNN NATIONAL CORRESPONDENT: So a couple of things. Some things that people did not see coming. We knew that the Nike indictment would happen. This is the indictment by the Southern District of New York on charges that Michael Avenatti tried to extort Nike out of more than $20 million in exchange, basically, for not putting things out in the public due to some issues that he said that Nike was responsible for, basically, dealing with athletes and trying to bribe athletes to go to certain schools that he accused Nike of.

But this is new. This something we had not yet heard. This coming out today, in the U.S. attorney's announcement there in the New York. He said that Michael Avenatti has also now been indicted on fraud and aggravated identity theft charges.

Now what that has to do with is the book deal that he helped broker for his client, you will recognize her name, Stormy Daniels. You will remember Stormy Daniels was the news for a whole year as she brought forward lots of allegations against Donald Trump and Michael Cohen.

And so she, basically -- in this indictment, the U.S. attorney is saying, look, he told her literary agent, had a signed piece of paper, and that signed piece of paper he said that Stormy Daniels had signed it, apparently, and that the monies were to be given to him first and put into an account of his in lieu of giving it straight to her, somewhere around $140,000-plus that was involved in this particular case. And that money was diverted to his account as opposed to being paid to Stormy Daniels in an advance on her book.

And you'll remember her book was a lot about her life but also about what she said was a sexual relationship with Donald Trump where she described all manner of things in that particular book and then ended up selling that book and it was published. But so this is very new. Something that we had not heard of up until

today. That the U.S. attorney not only is indicting Michael Avenatti on extortion charges. But now -- concerning Nike, the sports apparel company. But he is also now facing fraud and aggravated identity theft charges in connection with Stormy Daniels, in connection with trying to get money or getting money from her literary agent in connection with the book that she wrote.

And I do want to read you -- because Michael Avenatti has just tweeted, as he often does, when these sorts of things come up. And I do want to read you what he has put out just now to the public.


SIDNER: Let me find it here. He has basically said, look, in his Twitter response, he said, "I look forward to a jury hearing all of the evidence and passing judgment on my conduct. At no time was any money misappropriated or mishandled. I will be fully exonerated once the relevant emails, contract and texts messages and documents are presented."

That is just in the past 10 seconds. Michael Avenatti tweeted that out to the public in response to this particular indictment.

One, of course, is about Stormy Daniels and misappropriation of money, there according to the U.S. attorney. The other is about extortion charges when it comes to Nike. He has denied those to me in person.

We have talked at length in an interview where he talked about Nike. He has said this is Nike's way of getting the story that is damaging to Nike out of the press, and instead making him the villain. He is still accusing Nike of wrongdoing at this very point in time and has put documents out over the past few months concerning that.

But he is now formally being charged and has been indicted for extortion when it comes to Nike and fraud and aggravated identity theft when it comes to Stormy Daniels.


SIDNER: We still have not heard from Stormy.

[14:44:58] BALDWIN: To your point on the second piece of that, didn't see that coming.


BALDWIN: Sara Sidner, thank you so much for all of that.

Let me bring in CNN legal analyst, Anne Milgram.

And I know we're going to get to what we were planning to talk about in just a second. But listening to Sara's report on the U.S. attorney on these fraud and aggravated identity theft charges. And he's saying, I'm going to be exonerated, just wait. What do you think of this? ANNE MILGRAM, CNN LEGAL ANALYST: Yes, he's been saying that all

along. But remember, we now have three cases against him. We have the extortion case with Nike. We now have the Stormy Daniels, stealing money that was obviously intended for her through the book contract. And there's also the case in California in which he is alleged to have taken money that was supposed to go to a client who was badly injured and he took it all personally and just doled out a tiny bit to that individual over years.

So I find his denials really stunning in the face of how much evidence it seems, particularly having read this California indictment. There are just a lot of facts. There are text messages. There are emails.


BALDWIN: To back that up.

MILGRAM: It is very clear that the government will have extensive amount of evidence.

BALDWIN: We'll stand by on Michael Avenatti.

Hang with me. Because I want to get this. Democrats now a step closer in getting the president's tax returns. New York lawmakers just passed a bill that would allow Congress to see President Trump's state tax returns and the governor is expected to sign it.

It will require the state tax commissioner to turn them over upon request by any of the congressional groups, the House Ways and Means Committee, the Senate Finance Committee or the Joint Committee on Taxation.

So also today, for the first time, Treasury Secretary Steve Mnuchin went before lawmakers after the refusal to hand over the president's tax returns. He defended his decision, saying he made it without the White House input. But that didn't keep members of the House Financial Services Committee from grilling him.

Not just about his refusal, but also a report out of the "Washington Post" where it details a draft memo inside of the IRS, which is under Mnuchin, that contradicts him on the president tax returns.

The memo said that the tax returns must be given to Congress unless the president opts to invoke executive privilege. Mnuchin told the House panel he had not seen the memo until the "Washington Post" called him two days ago.


UNIDENTIFIED CONGRESSWOMAN: You are aware -- you are at least aware that the conclusion of that memo directly contradicts the conclusion that you're relying upon?

STEVE MNUCHIN, TREASURY SECRETARY: I actually don't believe that is the case. That memo, I understand, is addressing a different issue and is not addressing the issue that we, in the Department of Justice, looked at.

UNIDENTIFIED CONGRESSWOMAN: Would the IRS would decide not to run this memo up the chain.

MNUCHIN: I have no idea.

UNIDENTIFIED CONGRESSWOMAN: Are you going to try to find that out?

MNUCHIN: We're trying to find out who wrote the memo, where it came from, when it was, and why it wasn't distributed, yes.

I will take a look at the memo. I had not seen it until this morning. We didn't receive it. It was in the "Washington Post." So obviously, we'll take a look at it.

To the extent it changes our analysis for whatever reason, we would recognize that.

Again, I think this is a very important issue. On this one request, we've been advised that there are different legal views. And this is why it will most likely go to the third branch of government. And if the third branch of government opines on Congress' right, then we would obviously supply the documents.

Our issue is we want to make sure that the IRS is not weaponized for any party.

REP. MAXINE WATERS (D-CA): Did you discuss the memorandum with anybody inside of the White House, outside of the White House? I'm referring to legal counsel.


WATERS: I'm referring to lawyers. I'm referring to advisers.

MNUCHIN: Let me be clear. The only person I've discussed this memo with is my general counsel on the car ride over here, who is sitting behind me.


MNUCHIN: I have not discussed that memo.

Oh, and I did actually ask the commissioner whether he had seen that memo and he had not.


BALDWIN: Anne, so it is one thing for Mnuchin to say, hey, I didn't see the memo. It is another thing for him to not know the law.

MILGRAM: Right. If we take a step back, the law is very clear. It says "shall turn over" the tax returns for any American. And "shall" means "must." And so there doesn't need to be a reason why the Congress wants the tax request. There are three committees that could get access to them. That's the way it works. So the memo, interestingly enough, is completely consistent with the law as it is written.

And what is pretty amazing about this is what the Treasury secretary is saying is that he doesn't think that Congress has a legitimate purpose in asking for the tax returns. But it is important to note that is not the law. And it is not his decision as to whether or not Congress has a legitimate reason. The law says, Congress asks for any American's tax returns, Congress gets those tax returns.

BALDWIN: "Shall" means "must."

What about getting the state -- Trump's state taxes? If Congress is able to get those state taxes, will that enable them to get the federal?

MILGRAM: So I think -- I think there's two things. One is, sometimes in state tax returns people provide information about federal taxes. And so what is an interesting question is what we can learn from the state tax returns. It will be obviously -- that will include his income and include a lot of things that are also in federal tax returns. So I think we'll learn a lot from state tax returns.

[14:50:17] The second piece is I believe that Congress is already entitled and that this will go to a court. We can never predict what a court will do. But what a court should do is require that Treasury Department turn over the federal returns.


Anne Milgram --

MILGRAM: Thank you.

BALDWIN: -- thank you.

MILGRAM: Thank you.

BALDWIN: We are getting some breaking news now about a plot to bomb Trump Tower. What we're learning about the man who is now under arrest.


[14:55:07] BALDWIN: A New Jersey man is due in court this afternoon after the feds say he posted on social media that he wanted to bomb Trump Tower.

CNN national correspondent, Brynn Gingras, is with me.

Brynn, say what?

BRYNN GINGRAS, CNN NATIONAL CORRESPONDENT: Right. Twenty-year-old Jonathan Xie is his name. He will be appearing in court any minute now on five federal counts.

Essentially what we have learned from a criminal complaint that was filed is that, yes, he was making comments about supporting Hamas, the Taliban. He wanted to bomb Trump Tower. He even posted a picture of Trump Tower after visiting there, because he's from New Jersey, not that far away, saying, "Should I bomb this building --


GINGRAS: -- yes or no." Taking a poll. He said he wanted to put explosives into a truck and really go after Coachella.

So just a series of threats to actually live on his online accounts, Instagram and YouTube primarily.

And investigators were led to this guy really just beginning of this year, in January of 2019, by an informant who was having conversations with him online. So thank god, for that person to come forward because --


BALDWIN: We talk so many times about story, and how don't they know.


BALDWIN: And this is a perfect example of catching it.

GINGRAS: Exactly right. So we'll see how he pleads in court right now.

BALDWIN: OK, Brynn Gingras, thank you very much.

GINGRAS: Thank you.

BALDWIN: And now, the extraordinary moment when President Trump declared he will stop working with Democrats. Hear why, ahead.