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Trump To Sign Phase 1 Trade Deal With China; Russian Prime Minister Dmitry Medvedev Announces He And Entire Russian Government Will Be Resigning. Aired 9:30-10a ET

Aired January 15, 2020 - 09:30   ET

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


[09:30:00]

SEN. TINA SMITH (D-MN): Well, I'm very concerned about this, this data just came out yesterday, and I've just had a chance to look at a little bit of it. But I mean, that is creepy to think that there is surveillance of our Ambassador in Ukraine, which is a -- this is a dangerous part of the world.

So we need to get to the bottom of this and understand what's happening here. And let me just say, this is exactly why it is so important that in the Senate when this impeachment trial begins, we have an opportunity to evaluate evidence and hear from witnesses so that we can get to the bottom of this.

JIM SCIUTTO, CNN ANCHOR: Will you be able to? Is it clear that you will be able to consider evidence like this in the trial? Because as you know, some Republicans have made the point that, well, if it wasn't investigated during the house portion of this, we're not going to touch it.

SMITH: Well, here's what I think is going to happen. I'm always the optimist. But come tomorrow, the members of the United States Senate are going to raise their right hand and swear an oath to providing impartial justice.

We don't swear an oath to our party. We swear an oath to the Constitution and if my colleagues in the Senate really take that seriously, I don't see how they could come to the conclusion that we don't need witnesses. I mean, trials have witnesses.

SCIUTTO: Now, there's been a lot of talk of John Bolton. In fact, he has raised his hand being willing to testify if subpoenaed. Do you want to hear from him? But also from others, for instance, involved in this new evidence we've seen here, whether it be Rudy Giuliani or Lev Parnas, or perhaps this Republican congressional candidate who was involved?

SMITH: Well, I want to hear from witnesses and I want to see evidence that bears directly on the firsthand knowledge and experience of what happened here and how the President used his personal position as President to ask the Ukrainian government and Zelensky to interfere in our elections for his private gain.

That's the evidence that I want to make sure that we have an opportunity to hear in the Senate.

SCIUTTO: OK, China trade deal is going to be announced later this morning. You've got a lot of farmers in Minnesota. I know you speak to them all the time and the trade war has been tough for them. Trade work cost Minnesota businesses nearly $800 million through October 2019 according to one group there.

I wonder if you find this trade deal which the President has described as Phase 1 a step in the right direction for Minnesotans?

SMITH: Well, I think it is a step in the right direction, but it is a truce, not a victory. You know, China combined with Mexico and Canada are Minnesota's three largest trading partners, and our economy is built on international trade.

So the erraticness, the chaoticness of what we've been dealing with, with our trading partners over the last two years has had a real big impact on Minnesota farmers. I was just in Foley, Minnesota on Saturday and talking about the impacts of loss of soybean markets, for example, in China, so Minnesota farmers want certainty. They want to know that they're going to be able to count on these markets and that's what I hope we're moving towards.

SCIUTTO: I'm curious if you think there is certainty, because of course, we haven't seen details of the trade deal. It appears though China is making some commitments to buying tens of billions of dollars in agricultural products from the U.S., it's not clear how they would be required to do so. Would you trust Chinese commitments to make these purchases? And should farmers in Minnesota trust them?

SMITH: Trust but verify, right? I mean, the proof is in the pudding. And we have a long history of China making commitments that they don't keep, and we need to -- so I think it's yet to be -- it's yet to be told what exactly what will happen here.

I mean, let's be clear. China has been a bad actor, the way that they've stolen our intellectual property. The way that they've refused to open up their markets to American products has been really detrimental. So let's wait and see what happens here.

SCIUTTO: Final question before I let you go on the 2020 race, you, of course endorsed fellow Minnesotan, Amy Klobuchar, and there was quite a moment in that debate last night I'm sure you heard it, Elizabeth Warren making the point, hey, you know the only two folks who haven't lost races for office are myself, Elizabeth Warren and Amy Klobuchar. That's said. You have a man at the top of the ticket.

Now I just wonder, as the Democratic Party goes into voting here, Democratic voters, do you think it'd be a mistake for them not to nominate one of those women on the stage?

SMITH: Well, I am, of course, a strong supporter of Senator Klobuchar's. I Amy brings this -- as she calls it -- this practical, progressive, get it done attitude that I think is exactly what we need more of in Washington, D.C. But I mean, putting that aside, look at the successes that women have

had winning elections over the last few years, and I think you can't help but see that voters are ready to elect women.

I mean, in my own state, we have two women senators, and so I think it's -- and as Amy said, I think just a little while ago, I mean, this is a woman who has figured out how to win and the bluest of blue districts in Minnesota and the reddest of red districts in the same district that Michele Bachmann won, so that's the kind of electoral chops and power that I think voters ought to be looking for.

Of course, this is Iowa's election now and it's this election belongs to Iowans right now.

SCIUTTO: It's coming soon. Senator Tina Smith, pleasure to have you on the show this morning.

SMITH: Thanks so much. It's great to be with you.

SCIUTTO: Thank you.

[09:35:09]

POPPY HARLOW, CNN ANCHOR: Great interview. Okay, so a little bit more on the U.S.-China trade deal.

SCIUTTO: You know anybody from Minnesota?

HARLOW: President Trump about to Phase 1. What's in it? We still don't know. You'll find out next.

(COMMERCIAL BREAK)

HARLOW: Happening very soon, President Trump will sign a Phase 1 trade deal with China. But what's in it? Details have been kept under wraps.

Here to hopefully shed some light, Kevin Hassett, former White House Chief Economist under the Trump administration.

Kevin, very nice to have you. So 80 pages of details here, still not released by the administration. The President signing this thing in two hours, but you know what's in it. So what are the top lines?

[09:40:02]

KEVIN HASSETT, FORMER WHITE HOUSE CHIEF ECONOMIST UNDER THE TRUMP ADMINISTRATION: Yes, for the most part, folks have briefed me on what's in it, and I think that they're looking at something like a commitment to buy about $200 billion worth of stuff from the U.S. with maybe about $40 billion of that being agricultural products, and that's over the next couple of years.

But I think that the real headline of this deal is that there's very, very tough enforcement language that's going to basically make it so that if the U.S. or the USTR, the U.S. Trade Representative judges that the Chinese are stealing our intellectual property again, or forcing technology transfer, then they can start a 90-day adjudication process.

And if it's not resolved to the U.S.'s satisfaction, then the Chinese agree that the U.S. can retaliate in a proportionate way and they won't do anything else. So that's like -- you know, Peter Navarro two years ago when I was in trade meetings was arguing for something like that.

I mean, so it's really the case that the Chinese agreed to something that the hawks very much favored.

HARLOW: The snapbacks are in there, but why Kevin, and we'll get to the purchases in a moment. I don't understand why the White House did not put this out to the American people could read it.

It is so critical to so many Americans who have suffered as a result of the trade war. Why did they keep it under wraps?

HASSETT: Well, I think this is a negotiation, which is a little bit different from legislation, and I think that it's probably the case that the White House made the following judgment. If the deal leaked a week ago, you know, all the newspapers in the country are saying the U.S., you know, kicked China's butt. This is the best deal for U.S. ever, then maybe China would walk away from the deal and vice versa.

If people said, you know, hawks said this is the worst deal ever, the President is weak and so on, then maybe there'd be a lot of pressure for the U.S. to bail.

And so I think that you know, it was a very clever negotiation strategy by Bob Lighthizer and Secretary Mnuchin to just hold it really, really closely. Get a very good deal and then let everybody talk about it once it's signed.

HARLOW: All right, but transparency is important. And this is you know, the antithesis to that.

HASSETT: Yes, it begins to --

HARLOW: Let's get -- well, after it is signed. Let's get into the purchases, okay. You said $40 billion in Ag purchases. Treasury Secretary Mnuchin promised less than a week ago $40 billion to $50 billion a year, in Ag purchases from U.S. farmers by China -- that would be huge. That would be more than double the U.S. has ever sold to China in terms of agriculture. And we don't know what the Chinese translation of this says yet, let alone the U.S. one.

Can you 100 percent agree to America's farmers that is actually in there, and they can be guaranteed they're going to sell that much to China in the next two years?

HASSETT: You know, I think that the Chinese commitments are something that we're going to have to watch closely. And I think when there's a Phase 2 of this deal, it'll depend on whether the Chinese have kept their word. The exact number is something that I still don't know that we'll see

when the sketch of the deal comes out today. But there's going to be a massive purchase of agricultural products from farmers and especially soybeans, because if you look at the Chinese economy, they have a desperate need for soybeans right now, and so they really have to buy them anyway.

HARLOW: What about those that say look, this is just making up for the pain that was inflicted from this trade war, like the reason that U.S. farmers mainly haven't been selling all this stuff to China that they were before is that they've been hit by the response from China to our tariffs, right?

I mean, how is -- Mnuchin keeps saying this is a great win for American farmers. But isn't it just putting a Band-Aid on the wound that the administration arguably created?

HASSETT: I think that you make a fair point that there are pockets of the economy where, you know, they were dealing okay with China before, their business was disrupted because of this dispute. And now it's going back to normal, and so they just end up kind of losing in between.

But the real success of this trade deal is that, you know, we at CEA when I was there, the Council of Economic Advisers, estimated that the Chinese were stealing hundreds of billions of dollars of intellectual property from the U.S. every year.

So the U.S. economy is going to be way, way better off if they keep their word and they stop doing that, and they again have given us a very, very strong mechanism for doing that with adjudication, you know, 90 days and proportionate response.

I think that for sure we could find pockets of the economy where what you said is exactly the right way to describe it. But I think for the economy as a whole, we're going to be much better off.

HARLOW: All right. But for those pockets, it's been a lot of pain and not a lot of gain as a result. Okay. Two more questions. Let's just talk about what we learned this week when it comes to this nation's debt and the Federal deficit, topping a trillion dollars last year.

The President, as you know, said in 2016, that in eight years, he could eliminate the national debt. He tweeted this in 2011, "Our deficit spending is China's gain. President Obama is bankrupting our country." Are he and Congress doing the same thing now to China's benefit?

HASSETT: You know, I think that you're right that the deficit is out of control. I think that the biggest part of it is spending. If you look at the Congressional Budget Office Outlook, then in the out years, revenue right now is projected to be higher than it was when the President took office because of all the extra economic growth.

But spending is way, way higher than we thought it would be even in 2016. So you're right that if the President is reelected, or if somebody else is elected, then deficit reduction is going to be front and center for the agenda for the next for years.

[09:45:08]

HARLOW: I mean, and the tax cuts attributed to it, and China is benefiting from it just as he slammed President Obama few years ago. But look, let's see where this goes. Hopefully, people can actually rein some things in.

Final question, I don't think this is getting enough attention. Iran is still selling 70 percent of its oil, it exports to China and China is still happily buying that and funding the regime and funding all of that activity and terrorist action. This is despite U.S. sanctions. And that's still happening.

Do you think the U.S. should be inking this deal with China today without quashing that?

HASSETT: You know, there have been some discussions of movements on that, and I think that you're right, that one of the release valves that the Iranians still have, is to go through China, and I know that talks about that are underway.

The one thing I can say is that the sanctions that are already in place, have really significantly impacted the Iranian economy, which is really in deep trouble. And now that Secretary Mnuchin is pursuing this thing where basically if you do business with Iran, then you can't do business in the U.S., then they're going to be a lot of companies all around the world in China and everywhere else that think twice about working with Iran.

And I think that's one reason why there's so many protesters on the streets in Iran right now. They recognize that the radical government has put them in a really bad place.

HARLOW: Okay, I hear you, but the sales do continue. Kevin, thank you for being with us. We appreciate it.

HASSETT: Thank you.

HARLOW: You got it.

SCIUTTO: What's the story? Russian President Vladimir Putin has made a power move that has pushed his entire government to resign and maybe a plan for him to hold on to power.

(COMMERCIAL BREAK)

[09:51:07]

SCIUTTO: This just in to CNN. An apparent power grab by Vladimir Putin in Russia. The Russian Prime Minister Dmitry Medvedev has announced that he and the entire Russian government will be resigning.

HARLOW: OK. This comes after Russian President Vladimir Putin proposed several constitutional changes again, that would weaken his successor and help him again retain power. CNN Senior International Correspondent, Frederik Pleitgen joins us

again from Moscow. We've seen this playbook before.

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, exactly. I'm not sure where this is more a consolidation of power than the extension of Vladimir Putin's power because he has pretty much already consolidated all the power in his hands.

But you're absolutely right. This comes on the day of Vladimir Putin's State of the Union address. The Russian President has something like that, as well.

We're at the end of the address, which really didn't have anything remarkable in it before that. He announced that he wanted constitutional changes, which as Poppy said, would give more power to the Parliament and the Prime Minister, rather than the President.

Essentially, it would say the Parliament would elect the Prime Minister rather than right now the President calling for the Prime Minister, which obviously means that the next President of Russia, which cannot be Vladimir Putin, according to the Constitution, because he is set to step down in 2024, after his fourth term as President would have a lot less power than Vladimir Putin does right now.

And then the announcement really came as a bombshell, guys. No one here in Russia was preparing for. Russian state TV didn't even break into live coverage on it at the beginning, because they didn't know it was coming.

You then saw Putin and Medvedev talking to one another and Medvedev then said, because the changes that were announced today were so fundamental to the balance of power here in Russia, that he felt it necessary for the entire government to resign.

Now, Vladimir Putin saying, I think this is something that's key as well, that he is going to speak to all of the members of the current government which is going to stay in power in a caretaker function and see whether any of them are going to retain their offices.

However, Medvedev is definitely getting a different position. He is going to be on the Russian National Security Council is what Vladimir Putin said, but it certainly does look as though Vladimir Putin really preparing for the time after 2024 when his next term ends -- guys.

SCIUTTO: Well, he's done it before, right? I mean, he switched places with Medvedev before. He came out as Prime Minister, wielded the actual power, went back as President. I might say, he is going to do it again, and now he will lead the country from the Prime Minister role.

Anyway, that's what authoritarianism looks like. Frederik Pleitgen, thanks very much.

We're moments away from House Speaker Nancy Pelosi's announcement on who the Impeachment Managers will be. Also next steps here, we're getting ready for a trial of a sitting

U.S. President in the Senate. We're going to bring you all the news live.

(COMMERCIAL BREAK)

[09:57:58]

ANNOUNCER: This is CNN breaking news.

HARLOW: Top of the hour, a big morning. Good morning, everyone. I'm Poppy Harlow.

SCIUTTO: Breaking news this hour. You're going to hear it here on this broadcast, Nancy Pelosi making her move.

Any moment, the House Speaker will announce her picks for Impeachment Managers. This is important. These are the people who will prosecute the case against President Trump in the Senate trial. This is the official beginning of the trial process.

HARLOW: Yes. And then a few hours from now, the House will vote on those managers before actually walking the two Articles of Impeachment across the Capitol to the Senate chamber.

Let's go straight to Manu Raju. He is live on Capitol Hill. Do you have any sense of who's going to be picked? Do we know the names yet?

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, Nancy Pelosi has kept this process completely secretive. She's told virtually nobody, but I did spot several House members going into her office about half an hour ago before this press conference and these individuals potentially could be Impeachment Managers.

I asked each one of them if they've been selected. They've been asked to come as part of this meeting. They all refused to comment. The people include Adam Schiff, the House Intelligence Committee Chairman, he's long been suspected as probably who is going to lead this case, as well as House Judiciary Chairman Jerry Nadler. He also was walking in.

But I also saw Hakeem Jeffries, a member of the House Judiciary Committee, a member of the Democratic leadership in the House. I saw Jason Crow who is a freshman, a Democrat who's not on either the House Judiciary Committee or the House Intelligence Committee. He is on the House Armed Services Committee. He's a freshman. He's a former Army Ranger. He served in Iraq and Afghanistan.

He is someone who came up, got behind the Impeachment Inquiry in the aftermath of the revelations about Ukraine, and also Val Demings, who serves on both the House Judiciary and House Intelligence Committee. She had long been suspected as a possible Impeachment Manager.

I asked Demings, for instance, when I asked her if she has been picked, she said, I'm certainly going to find out, so it's not certain if she was told ahead of time, but we'll see if Nancy Pelosi decides to pick these individuals or more individuals.

The Clinton impeachment trial had 13 people who prosecuted the case. There's been some interesting on Capitol Hill that probably fewer than 13 individuals. We'll see how high it goes, how many individuals will come, but they'll all be here flanked next to Nancy Pelosi in just a matter of minutes.

[10:00:09]