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THE SITUATION ROOM

Foreign Leaders Testing Trump; New Impeachment Evidence Emerges; Interview With Rep. Steve Cohen (D-TN); Interview With Sen. Chris Van Hollen (D-MD); Democrats Seize On Newly Exposed White House Email That Ukraine Aid Freeze Ordered At Clear Direction Of Trump; Fundraising Race Heats Up Weeks Before Iowa Caucuses; Thousands Flee Deadly Fires as Australia Crisis Worsens. Aired 6-7p ET

Aired January 2, 2020 - 18:00   ET

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


[18:00:00]

WOLF BLITZER, CNN HOST: Happening now.

Clear direction. There's new evidence that the order to hold U.S. aid to Ukraine came directly from President Trump. And it's giving Democrats fresh ammunition tonight, as they cry cover-up and demand a fair impeachment trial.

Waiting for Pelosi. As the House speaker keeps holding on to the articles of impeachment, we're getting new information about Senate Majority Leader Mitch McConnell's business-as-usual strategy.

Cashing in. The top Democratic presidential candidates raise mega- millions ahead of the leadoff contest in Iowa. But can any of them compete with the Trump fund-raising machine?

And deadly wildfires. Infernos are raging, and Australians are fleeing, as officials warn this epic disaster is about to get even worse. CNN is on the scene.

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

We're following the disclosure of potential impeachment trial evidence that one key Democrat is now calling deeply incriminating. Newly unredacted documents reveal details on the freeze of U.S. military aid to Ukraine and Pentagon concerns it might be illegal.

One White House official reportedly declaring in an e-mail that the order came at the clear direction of the president. Tonight, Democratic leaders are accusing Mr. Trump of hiding those documents from Congress and the American people.

House Speaker Nancy Pelosi asking why the president and Senate GOP Leader Mitch McConnell won't allow a fair impeachment trial.

I will get reaction from Democratic Senator Chris Van Hollen. And our correspondents and analysts are also standing by.

First, let's go to our political correspondent, Sara Murray.

Sara, first of all, tell us more about these new unredacted documents and what they reveal about the hold on U.S. aid to Ukraine.

SARA MURRAY, CNN NATIONAL POLITICAL CORRESPONDENT: Well, Wolf, we have seen the redacted version of these before, but Just Security, a Web site, got their hands on the unredacted versions.

And they do reveal the way President Trump was directing what to do with this money, in the face of concerns from the Pentagon that withholding this aid to Ukraine could run afoul of the law.

In one e-mail on August 30, a top OMB official writes: "Clear direction from POTUS to continue to hold." This is an e-mail that's going to the Department of Defense comptroller.

Now, another e-mail continues. This is a back and forth where the comptroller is raising all of these concerns about continuing to withhold the money. So she's raising her concerns, saying: "Recognizing the importance of decision space, but this situation is really unworkable, made particularly difficult because OMB lawyers continue to consistently mischaracterize the process and the information we have provided. They keep repeating that this pause will not impact DOD's ability to execute on time."

This is from the Pentagon comptroller.

So, Wolf, these e-mails tell us two things. One, they show that the Pentagon was not at all comfortable with the way that the Office of Management and Budget was sitting on this money and the way that it was communicating with other government agencies that this money could still be -- get out the door in time.

The Pentagon was not confident about that. And, secondly, it tells you that, even though these concerns were rising to the level of the White House, the president still did not want to release that money.

BLITZER: Very interesting, indeed. Democrats right now potentially have some new ammunition.

Sara Murray, reporting, thank you.

Top Democrats, they are weighing in on those newly unredacted e-mails, accusing Republicans of a cover-up.

Let's go to our congressional correspondent, Phil Mattingly.

Phil, we heard from the House and Senate -- and Senate Democratic leaders. What's the latest?

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Yes, that's exactly right.

We also heard from the House Intelligence Committee chairman, Adam Schiff, who essentially led the Democratic impeachment inquiry up until its final stages, calling the release of the documents today by Just Security -- quote -- "deeply incriminating" and underscoring that the administration was essentially trying to keep these away from Congress.

And had they have been willing to turn them over, it would have underscored that they didn't have anything to hide. Because they did not turn them over, it's the exact opposite.

We also had, as you noted, Wolf, the speaker and the Democratic leader in the Senate weigh in, Speaker Nancy Pelosi saying -- quote -- "President Trump engaged in unprecedented total obstruction of Congress, hiding these e-mails and all other documents and his top aides from the American people. His excuse was a phony complaint about the House process. What's the excuse? Why won't Trump and McConnell allow a fair trial?"

And that statement largely echoes what we heard from Senate Democratic Leader Chuck Schumer, using these new documents, these new e-mails to put pressure on Senate Republicans about the structure of the trial, Schumer calling the documents -- quote -- "a devastating blow" to McConnell's push, at least at the early stages, to only have a trial with two presentations and questions from senators, not necessarily witnesses.

Wolf, so there's no question about it. Democrats are seizing on these new documents. Schumer has seized on a number of stories over the course of the last two weeks to try and push their case in the Senate, where they are in the minority, but it will only take 51 votes to be able to get what they want when it comes to that Senate trial -- Wolf.

BLITZER: You know, Phil, as the president's impeachment trial remains in limbo right now, what are you expecting tomorrow from the majority leader, Mitch McConnell, when the Senate returns?

MATTINGLY: Well, first, it will be nice to have lawmakers back in town to actually talk to.

[18:05:01]

But, look, I think there's a couple things we're going to pay attention to. One, obviously, it's not just Senator McConnell that's going to speak shortly after the Senate opens at noon for the first time in 2020.

Senator Schumer is expected to speak right after him. And the reality is that the impasse between the two over the structure of the trial, at least in its initial stages, remains.

And so what we're expecting from McConnell is not that he's moved off his position in any way, shape or form. Instead, it's going to be, as Republicans wait for Speaker Pelosi to send over those two articles of impeachment, they are very likely to just continue with business as usual, likely file cloture or consider procedural motions on nominations, move through whatever the business the Senate has, until the speaker decides to send those articles over.

Wolf, as you know, McConnell has already said clearly, if the articles don't come over, he's perfectly fine with that. He doesn't want an impeachment trial to begin with.

And the other thing we're going to be keeping a close eye on is Senator Schumer. Look, he spent the last two weeks continuing to hammer home the idea that in the initial stages of the trial, they need to lock in subpoenas for witnesses and documents. Expect him to continue can you on that path tomorrow.

I think the one question everybody has is, will the two leaders meet again? They met before the holidays. They were not able to break through the impasse. They're still in very different places about what they would like to see from a trial. Will they meet again tomorrow, leading into next week, where the expectation is perhaps the articles may come over?

And at some point, senators are going to have to decide how this trial is actually going to look -- Wolf.

BLITZER: Yes, we will watch it closely. Phil Mattingly, thank you.

We're told the impasse over the impeachment trial is getting under President Trump's skin as 2020 begins and his holiday break at Mar-a- Lago down in Palm Beach, Florida, winds down.

Our White House correspondent, Boris Sanchez, is with the president in Florida for us.

Boris, so the looming impeachment trial appears to be weighing very much on the president.

BORIS SANCHEZ, CNN WHITE HOUSE CORRESPONDENT: That's right, Wolf.

With lawmakers returning to Capitol Hill, sources close to the president have told us that he is growing anxious. The president is eager to get this Senate trial under way. He sort of wants his day in court.

Meantime, the White House responding to two crises overseas, not only in Iran, but in North Korea as well.

(BEGIN VIDEOTAPE)

SANCHEZ (voice-over): Tonight, President Trump railing against his impeachment, tweeting: "If this had happened to a president who was a Democrat, it would be considered the crime of the century."

Sources tell CNN White House aides have kept in touch with Senate Majority Leader Mitch McConnell's office during the holiday break, though it's unclear how frequently those talks have taken place, Trump's legal team plotting various procedural steps that might force House Speaker Nancy Pelosi's hand as they wait for her to deliver articles of impeachment.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I don't really care. It doesn't matter.

SANCHEZ: While publicly portraying ambivalence, sources say Trump has privately been restless, eager for a trial, quizzing allies and aides concerning his legal strategy, this as the White House faces threats from Iran and North Korea, the Pentagon issuing a strong warning that anyone who attempts to overrun the U.S. Embassy in Iraq will -- quote -- "run into a buzz saw" after a siege on the embassy earlier this week by supporters of an Iran-backed militia.

MARK ESPER, U.S. DEFENSE SECRETARY: This obviously crossed a line for us.

SANCHEZ: Trump is also responding to North Korea's Kim Jong-un.

TRUMP: He likes me. I like him. We get along. He's representing his country. I'm representing my country. We have to do what we have to do. But he did sign a contract. He did sign an agreement. And I think he's a man of his word. So we're going to find out, but I think he's a man of his word.

SANCHEZ: This after Kim announced, "The world will witness a new strategic weapon," and promised to deliver a Christmas gift to the United States.

(END VIDEOTAPE)

SANCHEZ: And, Wolf, the president is still sorting out his legal strategy while here at Mar-a-Lago on holiday.

We're told that he's been asking allies how he should move forward, some of them telling CNN that they counsel the president that he should bolster his legal team, something to keep an eye on -- Wolf.

BLITZER: We certainly will.

Boris Sanchez, thank you.

We're also getting some new information right now about the situation in Baghdad after the attack on the U.S. Embassy there.

Our Pentagon reporter, Ryan Browne, is joining us.

Ryan, what are you learning? I understand it's disturbing information.

RYAN BROWNE, CNN PENTAGON REPORTER: Well, Wolf, we just got a report in from the Iraqi military that three rockets have struck near the Baghdad International Airport, damaging two vehicles and wounding several Iraqi civilians.

Now, this airport also houses a U.S. military training facility. There was also diplomatic personnel. And it has been targeted by militia groups before. In fact, earlier, we heard from the secretary of defense, Mark Esper, today, who cited that earlier attack on the airport as evidence that this militia group had been targeting U.S. forces.

And, of course, that led to a recent airstrike that the U.S. conducted in the wake of one of those attacks that left an American contractor dead. And that sparked the recent demonstrations by that same militia group, who attempted to breach the U.S. Embassy.

We have -- we saw the scenes of that, where these demonstrators were attempting to light Molotov cocktails and engage. Now, they have since dispersed, but the U.S. is very much still worried about this militia group conducting attacks.

[18:10:06]

In fact, Secretary of Defense Esper today said it was possible that another provocation would take place, but said that they would regret it if they did do such an action. So it will be interesting to see what the U.S. does in response if this rocket attack is tied back to those same groups.

We haven't heard anything official yet from the Pentagon about this attack. We're only hearing about it from the Iraqi military, but, as you said, a very -- a situation that's worth watching, because there's a very serious chance of escalation here.

BLITZER: Yes, let's not forget there are thousands, thousands of Americans still in the Baghdad area, military personnel, contractors, diplomats, others. We will watch it very closely.

Ryan Browne, thank you.

Joining us now, Democratic Senator Chris Van Hollen of Maryland.

Senator, thank you so much for joining us. We have got lots to discuss.

But let me get your reaction to these new e-mails. The House speaker, Nancy Pelosi, is asking, why won't Trump and McConnell allow a fair trial? The Senate minority leader, Chuck Schumer, the House Intelligence Committee chairman, Adam Schiff, they're also pointing to these new e-mails as further evidence that the Senate needs witnesses and documents.

So, how does this help your case?

SEN. CHRIS VAN HOLLEN (D-MD): Well, Wolf, it's good to be with you.

Yes, this new information is very incriminating, very damning to the president's case. It shows, first of all, that the order to withhold the funding, the support for Ukraine came directly from the president at a very sensitive time.

It shows that the Defense Department was essentially freaking out, in addition to asking about the legality of the president's hold on the funds. And the fact that these were originally redacted, these were blacked out, shows that the administration was engaged in a cover-up. They did not want the public, they did not want the Congress to see what was in these e-mails.

So all of this just underscores the importance of having key witnesses, getting the essential documents, if we're going to have a fair trial. And right now, Mitch McConnell seems to be intent, working in lockstep with the president, to rig the trial and rig the process.

And I don't think any American thinks that that is the right approach to a trial in the United States Senate.

BLITZER: In order to get witnesses to appear in a Senate trial, you're going to need Republican support. There are 47 Democrats. Assuming all of you are united, you're going to need four Republicans to vote with the Democrats, get a 51-vote majority.

Are you going to get it?

VAN HOLLEN: I don't know, Wolf.

But I can tell you this. The American public overwhelmingly supports the idea that a fair trial requires witnesses, relevant -- witnesses who have relevant fact information, and relevant documents.

And so I'm sure those Republican senators are going to be hearing from a majority of their constituents about the importance of having a fair trial and having those witnesses.

We have all seen trials, whether in person in the courtroom or whether it's on TV or in movies. We all know that a fair trial requires that both sides be able to put on relevant witnesses and get relevant documents.

And to the extent that Republican senators vote against requests for that, they themselves will be complicit in the cover-up. This information is going to come out at some point. The only question is when. And I think there are going to be a lot of Republican senators who don't want to be seen, in retrospect or now, as engaging in a cover-up of important information, information important to the American people and to the impeachment trial.

BLITZER: We will see if the Democrats can come up with four Republican senators to vote in favor of witnesses.

How damaging, Senator, is it to see an Office of Management and Budget official spell out the president's instructions, writing -- and clearly writing in these newly released e-mails -- "Clear direction from POTUS," president of the United States, "to continue to hold"?

What's your reaction to that?

VAN HOLLEN: Well, it's very damaging.

If you remember back to the House proceedings, the Republicans were talking about the fact that it was all hearsay, it was all secondhand information. That wasn't true then.

But this new information simply adds to the case that the president was directly involved. You have got Defense Department officials totally confused, asking why this is being done. And you have OMB officials saying, well, it's being done because the president has ordered us to do it. They don't know why they're doing it either, at least not in these e-

mails. Now, the whole reason to call them as witnesses is to get additional information, which is why we have asked for four witnesses, for hours each. This doesn't have to eat up a lot of time.

I hear Republicans complaining about the need to get on with the trial. We could get on with this trial the day we're back, if the president would stop ordering White House officials to refuse to cooperate, ordering them not to testify, ordering them not to hand over documents, and if Mitch McConnell would agree to a fair trial.

[18:15:13]

We could get out of the blocks right away. So, what's really holding this up right now is not Speaker Pelosi. It's the refusal of the White House so far to provide any of this very relevant documents and information, information we're seeing as more and more incriminating by the day, and Mitch McConnell acting in lockstep with the White House, which is not his job under the Constitution.

He's supposed to be an impartial juror. We should all get all the evidence before making final decisions. But Mitch McConnell is clearly in league with the White House to try to cover this up. And that is a total abdication of his constitutional responsibilities.

BLITZER: Let me quickly, Senator, get your reaction to this attack on the U.S. Embassy in Baghdad. And now we're getting these reports of rockets being fired over at the Baghdad International Airport.

How concerned are you that this Iraq situation seems to be exploding right now?

VAN HOLLEN: Wolf, I'm very concerned.

Obviously, we need to do what's necessary to protect the lives of Americans. But, unfortunately, actions this administration has taken for weeks and months now have taken a very difficult situation, and made it much worse.

After all, in the last few days, we actually heard our allies in the government of Iraq criticizing the United States. We heard critical comments from the president of Iraq and from the prime minister of Iraq.

And that compares to just a week ago, where everybody was essentially taking to the streets to complain about Iranian influence in Iraq.

So, we need to be very smart about how we approach the situation. And, so far, what this administration has done has actually added more fuel to the fire.

Sometimes, this administration seems to forget that -- the political geography of the situation. You have got Iran right next door to Iraq. Iraq is a majority Shia country. These militias, many of them are actually under the umbrella of the armed forces of the government of Iraq. So the government of Iraq might turn around tomorrow and tell the

United States to take a hike. And that could really harm our interests in the area.

So we need to be a lot smarter than we are right now. Yes, make sure that we protect Americans on the ground, but do so in a way that doesn't boomerang on us and actually empower and strengthen Iran, at the expense of both the United States and Iraq.

BLITZER: Yes, hard to believe, 17 years after the U.S. moved in to Iraq to get rid of Saddam Hussein, the situation there today is as unstable as ever.

Senator Chris Hollen, thanks so much for joining us.

VAN HOLLEN: Indeed. Good to be with you.

BLITZER: Senator Van Hollen. I'm sorry. Senator Chris Van Hollen, thank you very, very much.

A quick programming note. Heading into President Trump's impeachment trial, join me for a special report on the last time the nation went through this. "The Trial of William Jefferson Clinton," it airs, a special one-hour documentary, Sunday night 9:00 p.m. Eastern, only here on CNN.

And just head, we will have more on those newly exposed documents about the Ukraine aid freeze. And will they have any real impact on the impeachment trial standoff?

And we will also go live to Australia. Look at this. The worst wildfire crisis in decades is taking another very deadly turn.

(COMMERCIAL BREAK)

[18:22:40]

BLITZER: Tonight, top Democrats say they believe they have incriminating new evidence against President Trump ahead of his impeachment trial.

A national security site has exposed previously redacted White House documents on the freeze of U.S. military aid to Ukraine, one e-mail revealing that a White House budget official told the Pentagon that the aid was held -- quote -- "on the clear direction of the president."

We're joined now by Congressman Steve Cohen, Democrat. He serves on the Judiciary Committee.

Congressman, thanks so much for joining us.

Your colleague the House Intelligence Committee chairman, Adam Schiff, calls these new e-mails deeply incriminating, while the Senate minority leader, Chuck Schumer, calls this a devastating blow to the majority leader Mitch McConnell's strategy. Does this help Democrats make the case for calling Trump

administration witnesses before a Senate impeachment trial?

REP. STEVE COHEN (D-TN): Well, it certainly helps the case.

And it helps the case with the public, who I think would like to know the truth. And it puts a real burden on the Republicans, because if they don't have a fair trial, and allow these documents and the witnesses to these events to testify, they will be held responsible at the polls, because the public will know about it.

And there's going to be more information, I think, coming out. And if they don't allow this information to be introduced in evidence, they will suffer.

So they have got a real conundrum. They can allow evidence in, which makes it more difficult for Trump, and it makes Trump look more guilty. But, at the same time, they -- if they don't do it, then they're going to be guilty. And at some point, they're going to have to decide whether they look out for themselves or they look out for the president.

And they may have to -- there could be a point where there's a divergence of interests, and they may have to look out for themselves and figure they're better off by voting what is right than sticking with Trump.

BLITZER: Do you think the House speaker, Nancy Pelosi, anticipated that additional information would come out when she decided to hold off on actually delivering the two articles of impeachment during this recess?

COHEN: I think it's entirely possible.

Speaker Pelosi has played this extremely well. She's a talented speaker, maybe the best ever. And I think that she knew that this evidence would be forthcoming. And I think there's more evidence that could be forthcoming.

What we've seen is clear from the witnesses who testified, the former Ambassador Fiona Hill, Volker, et cetera, all of them. It basically was clear that the president was involved in this project, drug deal, as Bolton called it, and he didn't want any information to come out.

[18:25:15]

Now we're seeing some of the information they redacted. And it's damning of the president, showing he knew what he was doing. He knew it was, more likely than not, illegal. And he resisted the information, the advice of the secretary of state, secretary of defense, and his own national security aide, because he thought he could play his politics with Rudy Giuliani and get around the Constitution, and not be concerned about our national security and get a benefit for himself.

And that's why he's been impeached. BLITZER: Would you support Speaker Pelosi if she decided to withhold

delivering the articles of impeachment indefinitely?

COHEN: Yes. Yes, I definitely would, because I think more and more information is going to come out. And I think it puts more pressure on McConnell.

And it makes the American public realize just how serious a situation this is and how compelling the evidence will be and is, if it's allowed to be seen by the American public and the Senate.

And, further, I think it's incumbent on all Democrats to support Speaker Pelosi. She's been right so many times in this particular episode, that we need to stay strong and support her.

BLITZER: What would be wrong, Congressman, with following the precedent set by Bill Clinton's impeachment trial?

They let the opening arguments from both sides go forward, and then they decided on whether or not to call witnesses.

COHEN: Well, because, in that situation, Tom Daschle had not said that he personally had communicated with the Clinton team to form their defense.

And Daschle -- Clinton hadn't totally stonewalled the Congress, and he had let information -- people testify and information that the Congress wanted to be delivered.

This is a different situation here, where the president has totally stonewalled the Congress. And that's one of the articles, is obstruction of Congress.

So, we come in with unclean hands. McConnell has said he wants to make this a quick trial, get it over with, and he's working strictly with the president, and he wants to get an acquittal. That wasn't the situation with Daschle.

And everything about Clinton was pretty much known before it occurred. We knew he had sex with an intern. And we knew he lied about it. And those are the only issues.

With this situation, there's a lot of proof and a lot of information that's been hidden by the president, obstruction of Congress. This is more obstruction of Congress.

So I don't think you could go with the Clinton rules, because you were dealing with a different president who responded to Congress and understood Congress' Article powers. And you were dealing with a different set of facts that the American public knew, which is -- right now, there's still information to be brought forward.

BLITZER: Congressman Steve Cohen, thanks, as usual, for joining us.

COHEN: Good to be in THE SITUATION ROOM. And happy new year.

BLITZER: Happy new year to you as well.

Just ahead: The 2020 money race intensifies. As the leadoff contest gets closer and closer, the Democratic field narrows. We're going to tell you who's leading the pack.

And the Australia wildfire disaster is exploding once again, with devastating fire tornadoes in the mix.

(COMMERCIAL BREAK)

[18:30:00]

BLITZER: We're getting new reaction this hour to disclosure of White House documents on the freeze of U.S. military aid to Ukraine. A Budget official reportedly spelling out in an email to the Pentagon that the aid was held on the clear direction from President Trump, that Democrats are accusing the president of trying to hide the newly exposed documents, which the House Intelligence Committee chairman, Adam Schiff, calls deeply incriminating.

David Swerdlick, how incriminating are they?

DAVID SWERDLICK, CNN POLITICAL COMMENTATOR: So I don't think it's a showstopper, Wolf, but it does help Democrats in two ways. It gets the narrative one step closer to their version of events, which is that this is at the direction of the president, and it undercuts a Republican talking about which was essentially, look, the aid was released, so who cares? These emails show that the aid was released only after a torture back and forth.

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Why isn't this a showstopper? Why isn't this not just one smoking gun but several in these documents? I mean, how much more do you need when it says, the president wants to stop this aid, and there's no reason given except for the announcement of this investigation? I mean, why is this not several smoking guns?

SWERDLICK: I don't disagree with you, Jeffrey. I would just say, when I say it's not a showstopper, I don't think it's going to change the minds of most Republican senator. That's all that I'm saying.

TOOBIN: Well, that's a separate question. We're dealing with facts, not politics. The facts all point in the same direction. I'm sorry for the interruption.

SUSAN HENNESSEY, CNN NATIONAL SECURITY AND LEGAL ANALYST: Right. It's coming against the backdrop of already overwhelming evidence. So on the one hand, it is really astonishing, damning information, on the other hand, it doesn't fundamentally alter the narrative only because we already have such incredibly strong evidence of what happened.

It is a pretty good indication of why exactly the Trump administration is fighting so hard to not produce these documents and these witnesses, because if this is what is contained in a very, very small handful of emails, what do the rest of the documents the government is withholding, what do those show? JIM BAKER, CNN LEGAL ANALYST: Right, I agree with that completely. But it doesn't directly link the withholding of the aid to the investigations.

[18:35:01]

I think that's what the gap is here. And that's why -- I mean, I do think these are significant for a lot of different reasons but I tend to agree that they're not a showstopper.

BLITZER: But is it going to convince -- Jeffrey, is it going to convince four Republican senators to join the 47 Democratic senators, have 51 majority and allow witnesses to come forward in the Senate trial?

TOOBIN: I doubt it because the Republicans in the Senate are basically a rubber stamp for Donald Trump. They've done nothing but that the whole time. You have -- you remember last time, it was Bob Corker pretending he cared about the deficit or Jeff Flake clearing his throat about various issues, now with Susan Collins saying she's concerned, or Lisa Murkowski, they will do nothing except protect the president.

But I think those of us who are actually interested in the reality- based world should point out what these documents really show.

BLITZER: Because there was concern at the Pentagon that withholding the aid coming close to the end of the fiscal year could be a question of legality.

HENNESSEY: Right. So these documents do show further evidence that both OMB attorneys and Pentagon officials were concerned about two things. One, they didn't think that there was a valid, legal basis for the president or the executive branch to be withholding these funds. There's a limited number of reasons why the executive branch cannot disperse this funding. Wanting an investigation into a political opponent is not one of them. And so this shows that nobody else within the government thought that there was a legitimate reason.

Beyond that, it shows a really tortured back and forth between OMB officials and Pentagon officials saying, look, there's a separate law called Impoundment Control Act that says, if you're not going to spend this money, you have to tell Congress about it. This shows the administration refusing to do that even as the lawyers were telling them they have to. And that's not just evidence that what they were doing was illegitimate. It's also evidence that they were engaged in a cover-up.

BAKER: Excuse me, you have to tell Congress all of the facts, circumstances and considerations that go into the decision to withhold.

HENNESSEY: And instead, they chose to tell Congress nothing, whatsoever.

SWERDLICK: And then none of those emails between McCusker and Duffey does Duffey ever articulate a substantive reason why this should be upheld. He just simply said, we're upholding.

BLITZER: Jeffrey, quickly, I want to get your reaction. I've been getting a lot of reaction to a conversation I had with then private citizen Donald Trump in 2008. And we started speaking about Nancy Pelosi, the speaker. Listen to this.

(BEGIN VIDEO CLIP)

BLITZER: Nancy Pelosi, the speaker?

DONALD TRUMP, U.S. PRESIDENT: Well, when she first got in and was named speaker, I met her, and I'm impressed by her. I think she's a impressive person. I like her a lot. But I was surprised that she didn't do more in terms of Bush and going after bush.

It was almost -- it just seemed like she was going to really look to impeach Bush and get him out of office, which, personally, I think, would have been a wonderful thing.

BLITZER: Impeaching him?

TRUMP: For the war.

BLITZER: Because of the conduct he --

TRUMP: Well, he lied. He got us into the war with lies.

And, I mean, look at the trouble Bill Clinton got into with something that was totally unimportant and they tried to impeach him, which was nonsense. And yet Bush got us into this horrible war with lies, by lying, by saying they had weapons of mass destruction, by saying all sorts of things that turned out not to be true.

(END VIDEO CLIP)

BLITZER: All right, Jeffrey, I want your reaction.

TOOBIN: How can I add to that? What can I possibly say other than just watch it and see what he said? I mean, Donald Trump has been on every side of every issue. Remember, he used to be very pro-choice, now he's trying to get abortion outlawed in the United States. I mean, it's just -- this is who he is and this is who he has behaved his whole life.

BLITZER: What do you think, Jim?

BAKER: Well, it's rather rich for the president to be talking about kicking President Bush out of office when this president in his couple of years has made by Washington Post count, over 15,000 false, misleading statements. I just think that's unbelievable.

SWERDLICK: Yes. I mean, I think he there is trying to establish his anti-war bona fides for you, Wolf. But in the process fast-forward to today, he essentially made the case for his own impeachment.

HENNESSEY: I mean, look, it's not talking that the president of United States is fundamentally not a principled or honest person. I think that this is just evidence that that is characteristics that well pre-dated his term in office and now we're seeing them play out in the world's most important office and that's why he's getting impeached.

BLITZER: Everybody stand by, there's more news we're following, including this. Bernie Sanders rings in the New Year with a huge haul of campaign cash to put him over the top in Iowa.

And we'll go to the frontlines of Australia's wildfire disaster as a new week-long state of emergency has been declared.

(COMMERCIAL BREAK)

[18:40:00]

BLITZER: We're following the money as the Democratic presidential race goes into overdrive just weeks before the late-off contest in Iowa. Our Senior Washington Correspondent Jeff Zeleny is joining us from Iowa right now where Bernie Sanders has an event later tonight.

Jeff, Sanders topped the Democratic field in the latest round of fundraising. What's the latest?

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: Wolf, indeed, good evening. Bernie Sanders raising $35 million in the three months of 2019, $18 million of that was in the month of December alone. There was no question that he and other candidates, like Joe Bide, Pete Buttigieg and more will have enough money to stay competitive as this campaign finally reaches the calendar of 2020.

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ZELENY (voice-over): It's 2020, and Bernie Sanders is starting the New Year with a bang, announcing today that he raised more than $34 million in the final three months of last year -- a muscular tally, likely to make him the top fund-raiser in the Democratic field.

But Joe Biden also recorded his biggest fund-raising amount yet, saying tonight that he raised $22.7 million in the fourth quarter of 2019. That was just shy of Pete Buttigieg, who announced he raised $24.7 million.

One month and one day before the Iowa caucuses open to voting, those three leading candidates rushed to release their fundraising tallies as a sign of strength.

At a stop in Iowa, Sanders said it proved his grassroots support is thriving.

SEN. BERNIE SANDERS (I-VT), PRESIDENTIAL CANDIDATE: What's important to me is not just a large amount of money, that is important. And that tells me the kind of grassroots support that we have and tells me why we're going to win the nomination and why we're going to defeat Donald Trump.

ZELENY: Sanders' total came from 1.8 million small dollar contributions, his campaign said, with his individual donations now surpassing 5 million.

Andrew Yang also making a big showing, raising $16.5 million, a significant jump from $10 million in the third quarter.

Their Democratic rivals have until the end of the month to report their fund-raising, but none are likely to surpass another candidate in the race, President Trump, whose campaign said today he raised $46 million over the last three months of 2019.

The president is playing a pivotal role in the Democratic primary, where most voters say electability is their chief concern. Tonight, Democratic candidates are fanning out to start delivering their closing arguments.

Biden is making the case he's the strongest candidate to take on Trump.

JOE BIDEN (D), PRESIDENTIAL CANDIDATE: But eight years of Donald Trump will I think in a fundamental way change the nature who we are. We can't let that happen.

ZELENY: Biden winning a key endorsement from Iowa Congresswoman Abby Finkenauer, a Democrat who won her seat in 2018 in a district Trump carried.

BIDEN: Abby, thank you, thank you, thank you for having me.

ZELENY: Today, Julian Castro becoming the latest candidate to step aside. The former San Antonio mayor and housing secretary in the Obama administration, bowing to political reality.

JULIAN CASTRO (D), FORMER PRESIDENTIAL CANDIDATE: I determined that it simply isn't our time.

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ZELENY: Now, Wolf, the Bernie Sanders campaign bus will be pulling up here momentarily. We're in downtown Muscatine, just on the banks of the Mississippi River.

Now, all these candidates have been raising the money. Now, they are spending it as well. The airwaves are filled with commercials, making their points here, Wolf, 32 days until the Iowa caucuses. Of course, impeachment will interrupt, you know, those proceedings for some of those candidates. That's why these senators in particular are aggressively campaigning this week -- Wolf.

BLITZER: Yes, they are.

All right. Jeff Zeleny on the scene for us, thank you.

Just ahead, after seven deaths in 24 hours, officials fear Australia's wildfire disaster is about to claim more lives.

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BLITZER: We're following the deadly wildfire disaster in Australia. Thousands are fleeing their homes as the flames close in. A new week- long state of emergency has been declared.

CNN's Anna Coren is on the ground for us in Australia right now.

Anna, this crisis is expected to get even worse in the hours ahead.

ANNA COREN, CNN INTERNATIONAL CORRESPONDENT: Yes, that's right, Wolf. We're expecting catastrophic conditions to return here to the south coast of New South Wales and right up and down the east coast of Australia. High temperatures, ferocious winds, really the perfect conditions for more firestorms.

We saw those horrendous fires on New Year's Eve which claimed numerous lives taking the death toll now to 18. Authorities have announced there are 28 people missing in the state of Victoria. Many of them feared dead.

And as you say, the priority is to get people out of these fire zones. We've witnessed thousands of cars heading up highways, getting out of these areas, residents and holiday makers. This is summer. We are in the middle of summer here in Australia. People head to the beach.

And authorities are telling these people they must leave before these catastrophic conditions arrive tomorrow. It is just so dry here, Wolf, we are in the middle of a drought, and this is really adding to the sense of desperation. There is no respite on the horizon, no rain is forecast or substantial rain for the next few months, and this fire season, Wolf, will continue up until March.

So what these people are facing is just absolutely terrifying times ahead, but the priority for authorities is to get people out, and to really save lives, Wolf.

BLITZER: Certainly is awful, awful situation. Anna Coren in Australia for us, thank you.

And just ahead, we honor the memory of David Stern, the former NBA commissioner, whose tenure was a game-changer.

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BLITZER: Finally tonight, we pay tribute to a truly remarkable man, the former NBA commissioner, David Stern, who died yesterday. As a long time NBA fan who interviewed him on many occasions, I got to know him and I got to admire him. During his 30 years as commissioner, David Stern reinvented professional basketball, putting the NBA on the map, including the global map. I hosted a CNN town hall with David back in 2001, just ahead of the

NBA all-star game, right here in Washington, D.C. He was understandably so proud of what he had accomplished.

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DAVID STERN, NBA COMMISSIONER: In 1979 already, the NBA was a relatively small business, and now it's a very large business, and a very successful one. The game tonight is going to show, be shown in 206 countries around the world. Hundreds of millions of people are going to turn in via NBA.com.

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BLITZER: It's amazing what he accomplished and on behalf of all NBA fans here in the United States and around the world, I simply say, thanks. David Stern was 77 years old, our deepest condolences to his wonderful family and friends. May he rest in peace and may his memory be a blessing.

"ERIN BURNETT OUTFRONT" starts right now.

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