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The Lead with Jake Tapper

Ruth Bader Ginsburg Undergoes Cancer Treatment; Dow Plummets; 21 Dem Candidates Remain as Key Debate Approaches. Aired 4-4:30p ET

Aired August 23, 2019 - 16:00   ET

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

[16:00:00]

ERICA HILL, CNN HOST: A massive FBI bust and why you should just delete any message asking you to help smuggle diamonds.

ANNOUNCER: This is CNN breaking news.

(BELL RINGING)

HILL: Welcome to THE LEAD. I'm Erica Hill, in for Jake.

And we begin with breaking news in the money lead. You just heard the closing bell there on Wall Street, and you can see Wall Street nosediving. President Trump dramatically escalating his fight with China and his own Federal Reserve chair.

The Dow plunging more than 600 points ahead of the president's critical trip to the G7 summit this weekend.

CNN's Alison Kosik is at the New York Stock Exchange.

And, Alison, China, of course, slapping tariffs on $75 billion in U.S. products today. Is that what spooked Wall Street to this point?

ALISON KOSIK, CNN CORRESPONDENT: You know what, Erica, I think that's part of it, but I think the bigger part impacting the market was President Trump's tweet tirade, his tweet that he would be responding to China's tariffs this afternoon.

Well, that response never came, so it created this wild card for investors that breeds all this uncertainty, the very thing that investors hate. It's why they sold so big, the Dow falling about 619 points.

Not helping, his Twitter attack against Fed Chief Jay Powell about the fed, as usual, doing nothing, he said. Powell is at the annual Jackson Hole, Wyoming, meeting of central bankers and economists. It's where they talk about global economies and monetary policy. It's not a place where the Fed chief would make rate decisions, especially since rate decisions usually happen at scheduled meetings, unless there's an emergency.

And, Erica, last time I checked, there was no emergency here, except for all the red on the screen. Now, Powell didn't give an indication of any action that the Fed will make at its Fed September meeting, but he did acknowledge, Erica, that the economy has grown more turbulent in the past three weeks -- Erica.

HILL: Alison Kosik with the latest for us from the New York Stock Exchange.

Today, Federal Reserve Chairman Jerome Powell, as Alison just noted, acknowledged there are -- quote -- "significant risks" to the economy, including the tense trade war with Beijing. And that statement prompting President Trump to question whether Powell, his hand-picked Fed chief, is actually worse for the United States than China's communist leader.

Let that sink in for a moment.

CNN's Boris Sanchez picking up our coverage now from the White House.

(BEGIN VIDEOTAPE)

BORIS SANCHEZ, CNN WHITE HOUSE CORRESPONDENT (voice-over): As President Donald Trump prepares to depart for the G7 in France, sources say he's questioning why he should attend a conference he sees as unproductive.

The last two gatherings of the world's top leaders ended acrimoniously, with Trump feeling like he isn't given enough time to tout his achievements, like the economy, according to sources.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The economy has been really fantastic.

SANCHEZ: Trump also triggered today by new Chinese tariffs, huddling with his economic advisers in the White House, attempting to unveil immediate retaliation and firing off a string of tweets, writing -- quote -- "Our country has lost stupidly trillions of dollars with China over many years. I won't let that happen. We don't need China and, frankly, would be far better off without them."

Trump also adding a demand he doesn't have the power to enforce, tweeting: "Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies home and making your products in the USA."

Trump adviser Peter Navarro telling CNN the tariffs are emboldening Trump.

PETER NAVARRO, DIRECTOR, WHITE HOUSE OFFICE OF TRADE AND MANUFACTURING POLICY: When China reacts like this, what they simply do is strengthen the resolve of this president and they signal once again to the American public that China wants to buckle our knees so that they can keep having their way with us.

SANCHEZ: Trump also assailing Jerome Powell, after the Fed acknowledged troubling signs in the economy, but gave no signal the Fed would follow Trump's call to cut interest rates next month.

Speaking at an economic symposium, Powell saying -- quote -- "We're carefully watching developments as we assess their implications for the U.S. outlook and the path of monetary policy."

In response, the president tweeting, in part: "As usual, the Fed did nothing. We have a very strong dollar and a very weak Fed. My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?"

(END VIDEOTAPE)

SANCHEZ: We're still awaiting an announcement from President Trump on exactly how he plans to respond to those retaliatory tariffs from China.

In the meantime, we know he's been watching the markets because a couple hours ago he tweeted out a joke about former Marine and presidential candidate Seth Moulton dropping out of the race, joking that Moulton dropping out is likely what triggered that downturn in the stock market today.

There you have the tweet, Erica, the president joking about markets falling via Twitter, even, though it was his own tweets that likely played a large part in that downturn we saw -- Erica.

HILL: Boris Sanchez with the latest at the White House for us -- Boris, thank you.

Also with us, "Washington Post" opinion columnist Catherine Rampell, who covers the economy, and Douglas Holtz-Eakin, the former director of the Congressional Budget Office.

[16:05:01]

Good to have both of you with us.

So, Douglas, you just wrote in "TIME" an opinion piece talking about how you're not too concerned about a recession, but saying that, in your estimation, the president really has a mixed report card when it comes to the economy, noting specifically his trade policies are what you see as a major obstacle to growth, and there's also the issue of this chaos.

Alison touched on it in terms of how that's affecting just a little bit south of us at the exchange.

DOUGLAS HOLTZ-EAKIN, FORMER CONGRESSIONAL BUDGET OFFICE DIRECTOR: Right.

HILL: There's no clear message, there's no clear plan. What is the impact?

HOLTZ-EAKIN: I think this is an unambiguously negative part of what we have seen out of the Trump administration.

And today is a really good example of it. There was some substance today. China announced that they're going to introduce retaliatory tariffs. It followed the plan they announced at the beginning, which is if the U.S. moved, they would respond with commensurate actions. These are exactly the same kinds of actions on the same dates, September 1, December 15. So that really wasn't a surprise. People shouldn't have seen that as a dramatic change in the state of the unfortunate affairs between the U.S. and China.

But the president then immediately weighs in and, A, escalates a fight with the Federal Reserve in a way that's just unbecoming of a president of the United States, and, B, threatens to retaliate further against China in an unknown fashion, and you see the result.

So, it just sows uncertainty. It's been very damaging to global trade, global outlook and to the United States. It's ultimately not even serving his interests in hope for reelection. It's been something that has been puzzling and baffling from the beginning.

HILL: It's not serving the president's interest, in your estimation.

Catherine, as you look at this, this back and forth between President Trump and China, is anyone winning here?

CATHERINE RAMPELL, "THE WASHINGTON POST": It certainly doesn't seem like that's the case. Or at least neither of the United States nor China, I will say, is winning here.

I think that there are a lot of ways to make both parties worse off at this point. It's hard to see a path to making either side better off, given that you have farmers in the United States suffering. We have four studies now from, you know, highly credentialed economists saying that Americans are paying the cost of the tariffs.

You have manufacturers and retailers and importers worried about the costs that they're paying, as well as the uncertainty that they face about future costs and where they should be sourcing their materials from.

You have China suffering, of course, which has the risk of contagion effects. So there are no winners here, except to the extent that maybe other low-cost countries like Vietnam could potentially benefit from companies trying to move their sourcing out of China and into other locations, which they have been doing with mixed success.

They're not coming back, by and large, to the United States. They're going to other places.

HILL: Well, we will see what ultimately happens there.

Appreciate you both joining us with your insight this afternoon. Thank you.

As we look at all of this, too, there is, of course, a political angle that can't be ignored as we're looking at what's happening. The president making a number of declarations, as we've talked about, on Twitter today, including this: "Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies home and making your products in the USA." Scott Jennings, I don't know about you. I'm not sure what that order is. Is the president trying to order companies to bend to his will? Is this a royal declaration? In some ways, it sounds a lot like socialism.

SCOTT JENNINGS, CNN POLITICAL COMMENTATOR: I read it the other way.

I read it that it was a message to the Chinese, which is I'm going to use my presidential influence to try to get American companies not to do business with you in an effort to give himself more leverage in this deal.

Look, I think the president's got a two-pronged issue here. One, he wanted to show the American people that a president of the United States is willing to stand up to China and to follow through on some threats, and, number two, the second prong, which he's not accomplished yet, but he needs to, and that is I'm a great deal-maker. And so after I stand up to these guys, I'm going to put a deal on the table that everybody wins under.

So he's got one accomplished. We're now in the murky middle here, where everybody's a little nervous. Now, if he can accomplish step two, I would just say every day we get closer to the election is the day that the Chinese regime probably thinks they can wait us out. So if I'm the president, I'm looking for a deal right now.

(CROSSTALK)

HILL: Let me clarify. You're comfortable with -- as a Republican, with the president ordering companies to do something the way he wants them to do it? That's OK?

JENNINGS: No. No, I'm not comfortable with a president ordering around private companies, but I'm telling you, I read it backwards.

I read it the other way, which was I thought he was trying to signal to the Chinese that he's willing to talk to American companies about abandoning China. I don't -- I didn't read it as though he was nationalizing American industry, which is what a lot of Democrats would like to do, but I don't think a Republican president is going to do that.

HILL: Hereby ordered, those are certain words.

(CROSSTALK)

HILL: Go ahead, Karen.

KAREN FINNEY, CNN POLITICAL COMMENTATOR: Can you imagine, though?

This -- Trump -- the irony here is Trump used Chinese steel in a lot of his buildings. Can you imagine if a president would have, when he was a businessman, told him, you have to stop doing business with China?

[16:10:02] Look, a couple dynamics here that I think we need to be paying attention to. Number one, there doesn't seem to be a plan, and I think that's part of what is making the business community so anxious, right?

As Doug Holtz-Eakin just said, it was predictable that China was going to come back at us with something. To act like this is a huge surprise, I think, is adding to the uncertainty of, well, what's your endgame here?

Because the truth is, unfortunately, Scott, as we know, he's not a good businessman. This is a man who has filed for bankruptcy multiple times. This is a man who is used to being able to use all kinds of trickery, which you just can't use when you're the president.

And the second thing I think is really important is we have seen this pattern, this pattern of attacking Jerome Powell. We have seen this again and again and again. He makes it a loyalty test. Right?

That's not Powell's job. His job is to do what he thinks is right for the economy, and he knows he only has so many tools at his disposal to do that. But this whole -- this berating him and this making him the enemy is setting him up to be the scapegoat so that if and when things go bad, it's not Trump's fault, it's somebody else's fault.

HILL: Let's also point out, too, and we can't ignore the fact this is highly unusual -- and perhaps that's putting it mildly -- to not only attack the Fed chair, but to put out a tweet that says -- and, once again, I'm quoting -- "My only question is, who is our bigger enemy, Jay Powell or Chairman Xi?"

Aisha, when you look at that...

ANA NAVARRO, CNN CONTRIBUTOR: Yes, I have an answer for that one.

(CROSSTALK)

HILL: Go for it.

NAVARRO: The biggest enemy is Donald Trump. He's an enemy to sanity, he's an enemy to stability, he's an enemy to the American presidency.

He's an enemy of decency and of morality, and, frankly, he's an enemy of conservative and Republican principles, because if you are a Republican, you are a free trader. You are not for trade wars. You're not for tariffs. You're not for running a $1 trillion deficit.

You're not for antagonizing allies and coddling foes. When you see a president who is using the bully pulpit of the presidency to attack other Americans, to break international relations, to cause instability and chaos, and I think what he's trying to do is distract us from the fact that he inspired a white supremacist to go hunt down Latinos, and that he capitulated to the NRA, and that his economy is going so badly.

He is trying to distract us, but his words have consequences, his tweets have consequences. He is being irresponsible, impulsive, ignorant, and shortsighted, and that has enormous consequences.

AISHA MOODIE-MILLS, CNN POLITICAL COMMENTATOR: And, more importantly, he is trying to be an autocrat, and I don't want us to like lose sight of that.

That is exactly what he's doing. By trying to order corporations to do anything, he is saying, look, I am your master and you do what I tell you to do.

And the other thing is that Donald Trump runs around acting like this is all to the benefit of the little guy, of his supporters, who are non-college-educated white folks, frankly.

And the truth is, is, who paid the price today when the Dow crashed? Who pays the price every time he tweets out something that tanks the economy? It's all of us with our 401(k)s that are paying the price for his recklessness.

So, I think that we need to not skate over the fact that in his language time and time again, as well as in his behavior, he thinks he's a dictator. He actually thinks he's on par with North Korea and China and is trying to treat America in that way, and we're all paying the price for it.

HILL: I do really quickly also want to touch on the fact that, of course, the president is leaving tonight for the G7, making his way to France.

We have new reporting. We know he was not happy the last two times he attended the G7. He is not excited about going, didn't really like the focus of the last two. And so from our reporting, he was specifically irked that he wasn't given enough time to tout his own accomplishments at the past two meetings.

His aides lobbied to add a session on the economy, so he could brag about, Karen, how strong the U.S. economy is to his fellow world leaders.

FINNEY: Can I tell you, that's just so disgusting to me.

I worked for President Clinton and actually I worked for the president when he -- when President Clinton actually advocated to add Russia to the G7 to make it the G8, because they were on the path to democratic reforms.

So I have to believe that part of what is going to not be fun for this president sitting at the G7 is, they don't want to add Russia to the G8. Right? They don't want to go back to the G8 because there are a lot of concerns about Russia. There's a lot of concerns about our economy, and the stabilization, frankly, of the world economy.

I mean, you have to believe that if you are Emmanuel Macron, you're sitting there trying to read, figure out, what is this president doing, and how do I -- what do I need to do to keep my economy strong?

HILL: We will be watching for all of that. As we move on to looking at 2020, we're told it's the lowest point in the campaign. What is so worrying for certain insiders for one top 2020 presidential contender?

Plus, we do have breaking news at this hour, the Supreme Court releasing a rare statement. Justice Ginsburg's fourth bout with cancer -- that's next.

(COMMERCIAL BREAK)

[16:15:00] ERICA HILL, CNN HOST: The Supreme Court releasing a rare statement, Justice Ruth Bader Ginsburg's fourth bout with cancer. That's next.

(COMMERCIAL BREAK)

HILL: Breaking news in the national. We've learned Supreme Court Justice Ruth Bader Ginsburg just completed treatment for pancreatic cancer. This is the 86-year-old's fourth bout with cancer.

I want to bring in CNN's Ariane de Vogue.

So, news of the treatment actually came from the court itself. What more do we know about how she's doing and what the treatment was?

ARIANE DE VOGUE, CNN SUPREME COURT REPORTER: Right, Erica. We know that the treatment began August 5th for a tumor on her pancreas. It's called a localized malignant tumor. We know that she canceled her annual vacation in San Francisco, or in Santa Fe. But next Monday, she's going to go ahead and appear at a speaking event in Buffalo.

And get this, we know that during her treatment, she appeared in an event in New York City and she met actress Kate McKinnon, who, of course, plays her on "Saturday Night Live".

[16:20:09] So, that happened during the treatment.

And last night, this justice, 86 years old, was on Broadway watching a performance of Moulin Rouge. So, she is one tough customer, struggling with this new diagnosis of cancer, Erica.

HILL: A tough customer with this latest diagnosis. This though is her fourth bout with cancer.

DE VOGUE: It's remarkable. In 1999, she had surgery for colon cancer. In 2009, an early stage of pancreatic cancer. In 2014, she had a heart condition.

And in 2018, just last year, she had surgery to remove two cancerous nodules from her lungs. Keep in mind, that was the only time, given everything I've just said, where she missed sitting on the bench to hear oral arguments.

Earlier in the summer, she gave a talk just after the death of Justice John Paul Stevens, and she said that she had talked to him, and she had said you know, my goal is to stay on the bench as long as you did, in your 90s, and she said he responded "stay longer".

And she said later in that thing that she said, I've always said I'll stay on this job as long as I can do it full steam, Erica. So, that seems to be her goal.

HILL: There you go. Ariane de Vogue, appreciate it, as always. Thank you.

Also with us this hour, Supreme Court biographer Joan Biskupic.

Joan, always good to have you with us. You also so well-sourced on the court. You, of course, wrote a book on the chief justice.

Do people actually talk about her health at the Supreme Court? Is that -- is that OK to do?

JOAN BISKUPIC, CNN LEGAL ANALYST: It's a sensitive subject, as you can imagine, Erica, and they want to give Justice Ginsburg her privacy. But, of course, they're aware of her situation at 86, even with just three cancer scares.

So, you see it in a couple different ways. One -- you know, one way I'll mention is sort of as a gesture and the other is more substantive. We see Justice Clarence Thomas helping her down from the bench after oral arguments all the time. He's always there ready to lend a hand. More substantively, though, we see Justice Ginsburg working with her younger liberal colleagues to sort of shore up the side on the left.

What she does is she's been assigning opinions that she normally would have given to Justice Kagan or normally kept for herself, she's giving to the other justices, laying groundwork for what would happen in the future. So, you can see them mindful of it, but also being respectful.

HILL: So, the court returns from break in October. At this point, we don't have an indication that there's any reason she would need to take any time off, but if that were the case, how do they proceed? How do they handle the day-to-day?

BISKUPIC: OK, I can tell you exactly how it happens because we've seen that already. Chief Justice John Roberts will announce from the bench, if she's gone, that Justice Ginsburg will follow the cases through listening to the audio of the oral arguments and reading transcripts and reading the briefs, which is exactly what she did for several weeks earlier this year when she was being treated for the lung cancer.

So, we expect that that's what he would say and that she would follow through. But at this point, she's obviously following her normal schedule, and getting ready to meet with the justices at the end of September, and then be there on the bench for the traditional first Monday in October.

HILL: Certainly doesn't seem to be slowing her down, at least not from the Instagram photos there. Joan Biskupic, appreciate it as always.

BISKUPIC: Thanks, Erica.

HILL: As another presidential candidate drops out, there is a new warning sign for front-runner Joe Biden and his electability. That's next.

(COMMERCIAL BREAK)

[16:28:37] HILL: In our 2020 lead, and then there were 21. Congressmen Seth Moulton ending his presidential campaign just a short time ago, narrowing down the historically large Democratic field, as campaign funds begin to run low for some.

So, now, of course, the question on everyone's mind, who's next? Get out your magic eight balls.

Moulton talking with reporters after, talking about the state of the race and this really stood out to me. Take a listen.

(BEGIN VIDEO CLIP)

REP. SETH MOULTON (D-MA), FORMER PRESIDENTIAL CANDIDATE: You know, I think unfortunately it's largely become a three-way race for president, and that's left out a lot of important voices, you know, people like the only combat veteran in the race, the only governor from a state that Trump won are not going to be part of the next debate.

(END VIDEO CLIP)

HILL: Aisha, is he right?

AISHA MOODIE-MILLS, DEMOCRATIC STRATEGIST: Well, look, if you're looking at ground game, which is what I'm looking at, then, yes, it's got three people right now who are really, really killing it, and I would actually add four because Kamala Harris is doing well in terms of putting her ground operation together, too.

But if you look at Iowa, I think the real wild card to watch in Iowa is Elizabeth Warren. She has an army of people on the ground there. She has quite the infrastructure for her campaign. And if you remember, that's what Barack Obama did, when the polls showed Barack Obama was way down and it was all about Hillary Clinton at the time, he was quietly putting together an operation knocking doors that ultimately won for him.

And I think that's what is going to play out. I think that Seth is right. He's seeing that. He can't afford to be on the ground down there.

But I do see that as Elizabeth Warren is winning the pack in Iowa right now, despite what the poll numbers might say about Joe Biden.

HILL: If we look at poll numbers, five -- five of these 21 candidates are actually up polling above 5 percent, according to our own Harry Enten here at CNN.

[16:30:00]