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Trump, Economic Advisers Downplay Recession Fears; Potential Mass Shooting Foiled In Three States; Trump Says, We Do Have A Lot Of Background Checks Right Now; Streets Clear After Massive Hong Kong Anti-Government March Sunday; Minnesota Farmer Says, Farmers Are Losing Big Time; Sen. Elizabeth Warren (D) Massachusetts, 2020 Democrats Speak At Native American Presidential Forum. Aired 10-10:30a ET

Aired August 19, 2019 - 10:00   ET

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

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[10:00:00]

JIM SCIUTTO, CNN NEWSROOM: A very good Monday morning to you. I'm Jim Sciutto in New York. Poppy Harlow is off today.

Recession worries, trade war fears, a looming financial crisis? If you're looking for a recipe that helps get a U.S. president a second term, those are not the right ingredients, and that explains the pushback by the Trump administration over the weekend claiming that fears by a growing number of economists that a recession is on the horizon are overblown. Have a listen.

(BEGIN VIDEO CLIP)

DONALD TRUMP, U.S. PRESIDENT: Yes, I don't think we're having a recession. We're doing tremendously well. Our consumers are rich. I gave a tax cut and they're loaded up with money.

(END VIDEO CLIP)

SCIUTTO: Fact check there, tax cut was for corporations, not consumers.

Joining me now is CNN's Boris Sanchez at the White House. And, Boris, we get a window into Trump's mind and fears based on his public comments, Tweets, et cetera. Is there a real concern in the White House about the economic data that they're seeing here?

BORIS SANCHEZ, CNN WHITE HOUSE CORRESPONDENT: There may be privately, but White House officials are not sharing that publicly, Jim. They're trying to tamp down worries that a recession may be looming.

We actually just heard from Kellyanne Conway a short time ago here on the north lawn of the White House. She defended the U.S. economy, saying that its fundamentals are strong and insinuating that the press was trying to attack the president, going after his strongest suit. As you know, Jim, whenever the president lists his accomplishments, the economy is frequently at the top of that list. But amid concerns about a looming recession possibly going into an election year and amid this ongoing trade war with China, the White House is trying to tamp down worries.

We heard over the weekend from sources explaining to CNN that aides talked the president into delaying tariffs against Chinese imports until December 15th by essentially telling him that tariffs would hurt American families around Christmas time, so we know that that concern is near the top of his mind.

Two of the president's top advisers on the economy spoke on the Sunday morning talk shows, Larry Kudlow and Peter Navarro. Here's what they said.

(BEGIN VIDEO CLIP)

PETER NAVARRO, DIRECTOR, WHITE HOUSE OFFICE OF TRADE AND MANUFACTURING POLICY: In this case, the flat curve is actually the result of a very strong Trump economy. What we see now is foreign capital coming to the best game on the globe, which is the Trump economy. It's going into our stock market.

LARRY KUDLOW, DIRECTOR, NATIONAL ECONOMIC COUNCIL: I sure don't see a recession. We had some blockbuster retail sales, consumer numbers towards the backend of last week, really blockbuster numbers.

(END VIDEO CLIP)

SANCHEZ: We just heard that optimism coming from Larry Kudlow, the Director of the National Economic Council. Sources here over the weekend told CNN that they expected Kudlow would soon be leaving the administration. He has served for two years already. President Trump was asked about that as he departed at his estate in Bedminster over the weekend returning to the White House. He had no idea whether Kudlow was staying or going, Jim.

SCIUTTO: Well, even conservative publications, the Wall Street Journal had an editorial talking about a Navarro recession based on the trade war. Boris Sanchez, great to have you at the White House.

Joining me now to discuss this, Jeff Mason, he is White House Correspondent for Reuters, and Brittany Shepherd, she is National Politics Reporter for Yahoo News.

Jeff, first, if we could begin on the president's focus on the economic issue here. His message for a 2020 re-election is really built, is it not, on a strong economy here. So he would be worried if the numbers lead in a negative direction.

JEFF MASON, WHITE HOUSE CORRESPONDENT, REUTERS: Oh, absolutely, Jim. I mean, I think the fact that he had these people out on the Sunday shows this weekend, the fact that he gave the robust defense that he did definitely suggests that even though they're saying, look, there's nothing to see here, nothing to be worried about here that they're probably worried, because that is absolutely one of his strongest arguments for re-election. There are plenty of voters out there who may not like all of the Tweets or some of the rhetoric that the president has done but who do like what he's done largely with the economy. So if that gets pulled out and changes by November 2020, then that takes away something that a lot of people uses to vote for President Trump.

SCIUTTO: Brittany Shepherd, it's interesting because you again heard Trump administration officials, the president, focus their fire on the Fed here, blaming them for raising rates too quickly last year and applying more pressure for them to cut rates now. Is that connected to the politics of this, right? They want the Fed to avert the chance that that talking point for 2020 is taken away?

BRITTANY SHEPHERD, NATIONAL POLITICS REPORTER, YAHOO NEWS: We've seen this kind of deflection before, Jim. And, you know, the Fed has definitely been a target of the president because we've seen that he doesn't want to be seen that under his rule that the economy has been weaker.

[10:05:00]

If you look at his approval ratings rights now, it's around the 41, 42 percentile. But if you look for his approval ratings in the economy, it's around, pretty strong, 53 and 54.

So to divert the attention to the Fed will be able to push kind of responsibility off him and off his economic advisers who are privately telling him that, look, like there's something in the water here, there might be a recession on the horizon.

SCIUTTO: All right. Jeff and Brittany, please stay with me. There's more I want to speak to you about.

First, another item on Trump's agenda, at least he's talked about the possibility of gun control, particularly after three potential mass shootings were stopped by authorities just over the past few days. The three men, all in their 20s, were arrested in different states, Ohio, Florida. Connecticut. Officials say that all of them had expressed an interest in mass shootings or even threatened to carry them out.

Polo Sandoval joins me now.

So, Polo, this is incredible, because in a short span of time, three people saw these warning signs, friends, acquaintances of these potential shooters, I imagine you might call them, and they came forward. It's remarkable.

POLO SANDOVAL, CNN CORRESPONDENT: Well, consider the example here in Ohio, right, Jim. Reardon, only 20 years old, he basically had the fire power and he also had the sentiment that essentially would have been the perfect recipe for the nation's latest mass shooting.

You were in El Paso and you saw that those are the two main ingredients that were required to carry out that massacre. Some background on this case here. Reardon was -- he really had no qualms about sharing his racist sentiment publicly, which you'll hear in just a few moments. Police do believe that he is the one who's seen in an Instagram video shooting a rifle, the caption of that video, tagging the Jewish Community Center of Youngstown, Ohio.

But that caption also implies that the gunman in the video would be behind this potential attack at the center. It was actually a resident in the small Ohio village of New Middletown that first flagged that post to police that, according to the chief, kicked off this investigation. They searched his mother's home. They found weapons, ammunition, a gas mask and they also arrested him, charging him with telecommunications harassment. The Middletown Police Chief, Vincent D'Egidio, telling CNN that their suspect is the same man that is seen in a National Geographic documentary on the 2017 Charlottesville Nazi rally.

(BEGIN VIDEO CLIP)

JAMES REARDON, SELF-PROCLAIMED WHITE NATIONALIST: I want a homeland for white people and I think every race should have a homeland for their own race.

(END VIDEO CLIP)

SANDOVAL: That short clip gives you some insight into his mind. We should mention, the FBI did interview Reardon. But so far, we're told they have not proceeded with any federal charges.

Two more cases over the last several days here, Jim, to tell you about, one of them in Connecticut. That is where another individual was arrested by authorities there. Investigators say that he essentially was stockpiling various components and then trying to build his own weapon. But then according to investigators, somebody had red flags, some Facebook posts where he was threatening a mass shooting.

And then finally in Florida, where a body camera video that was released by police in Daytona Beach shows the arrest of a man in his 20s, also arrested there. The individual now identified as Tristan Wix of Daytona Beach. Investigators are saying that he was threatening to open fire on large crowds and even texted his girlfriend saying -- I'll read you one of them here briefly. He said, I'd want to break a world record for longest confirmed kill ever, one of many disturbing texts that he's sent to his girlfriend.

The police and county sheriff's office saying that that ex-girlfriend really was the hero here, Jim, because the commonality in these cases, in Florida, in Connecticut and perhaps the most disturbing one here in Ohio is that somebody saw something, they said something, police moved in and arrested three individuals.

SCIUTTO: And look at the arsenal that, for instance, Reardon was able to collect there. It's just remarkable you can get those kinds of weapons in that kind of quantity.

SANDOVAL: You see what he had and you can see what he was thinking.

SCIUTTO: And there they are. And those long magazines, again, kinds of weapons, magazines that had played a prominent role in the number of the shootings we have covered.

Polo, great to have you on the story.

SANDOVAL: Thanks, Jim.

SCIUTTO: Let's bring back our guests, Jeff Mason, Brittany Shepherd. I want to play where the president is here. Because, once again, you'll remember after Parkland, he came out in favor of some gun control measures, background checks, even berated a Republican lawmaker for being afraid of the NRA. Let's compare the president's comments just after El Paso and Dayton and this week. And then, Jeff, I want to get your reaction. Have a listen.

(BEGIN VIDEO CLIP)

TRUMP: Well, I'm looking to do background checks. I think background checks are important. I don't want to put guns into the hands of mentally unstable people or people with rage or hate, sick people. I don't want to -- I'm all in favor of it.

People don't realize we have very strong background checks right now. You go in to buy a gun, you have to sign up. There are a lot of background checks that have been approved over the years. So I'll have to see what it is. But Congress is meeting.

(END VIDEO CLIP)

SCIUTTO: So that's ten days apart, Jeff Mason. Can we declare the president's latest attempt at universal background checks, if we could call it that, dead on arrival?

MASON: Well, I think we should probably wait, Jim, and see what sort of legislation comes out of this process.

[10:10:02]

But I think you can certainly declare it the beginnings of a reversal, if it isn't already a complete reversal. And that is in line with what happened after Parkland. You were right to flag that. At that time, he said he would stand up to the NRA and then pulled back. He said he was in favor of really intense background checks, as he did after these most recent mass shootings, and then most recently, in addition to that clip you just played, has also just been talking up a lot more about mental health. So we'll see.

He does say that he has aides working on the issue, that members of Congress and their staff are working on the issue, but it does look like he is moving away, again, from more aggressive action.

SCIUTTO: Yes, the mental health focus and we already have a lot of background checks is basically an NRA talking point. Brittany Shepherd, I'm curious where Congress is on this. I was in El Paso and Dayton. Of course, the perennial question after mass shootings like this is will this time be different. You did have some differences. You had a Republican governor of Ohio propose measures. You had a Republican lawmaker, Mike Turner, whose daughter was just feet away from the scene in Dayton, come out for a ban on assault weapons. What's happening on the hill now? Is there any critical mass to do something different this time?

SHEPHERD: Well, I think it's good to remind viewers that we are still in August recess. And right now, Congress is slowly coming back to Washington.

There is some reporting in Axios, which I've talked to some people to confirm, that if there is no gun legislation on the table by the end of September, that it will not get passed before 2020.

And I think it's important to look back. After Sandy Hook in 2013, we saw Manchin-Toomey bill. It was bipartisan and it failed. It only got five Republican senators to support that bill. And you would think after Sandy Hook, after all of those children died, enough would be enough. And like you said, Jim, it's always the perennial question which mass shooting will be the last.

But if House Democrats don't want to thin up the bill that they already have and Republicans don't want to move by the end of September, I can't see anything going on heading into a general election.

SCIUTTO: So, Jeff, that's where we are? There was for few minutes talk of bringing Congress back from recess to do something, but is this going to be another case to just wait it out and, you know, kick the can down the road?

MASON: Based on history, I think that's probably the case, Jim. But I think it is interesting to listen to the president when before he's had talks with the NRA or before he's had people kind of talk him down. It does seem like his initial instinct here and in Parkland was to go a little bit more aggressively and then he pulls back.

It's hard to know what actually drives that. It's hard to know how he would react if another shooting were to occur. But based on history, both his and the Congress's, it's unfortunately likely that there won't be a whole lot done.

SCIUTTO: Politics 2020 might play a role in that decision-making. Jeff Mason, Brittany Shepherd, great to have you both on.

Still To come this hour, anti-government, pro-democracy protesters are flooding the streets of Hong Kong. I mean just the numbers, the duration of these protests, the peacefulness, by and large, really remarkable.

Chinese leaders have now launched a dramatic new propaganda video in response.

Look at the soldiers marching there.

Plus, Senator Elizabeth Warren takes her progressive message to Native Americans, but could her past comments claiming native American ancestry come back to haunt her here? We're going to take you there.

And today, California's governor is expected to sign a bill limiting police use of deadly force. CNN asks him about it.. We'll have his answer coming up.

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SCIUTTO: Welcome back. Hundreds of thousands of pro-democracy demonstrators cramming streets and sidewalks for a massive and peaceful protest in Hong Kong on Sunday, it's the 11th straight weekend of demonstrations. President Trump meanwhile weighing in on the unrest, suggesting that Chinese President Xi Jinping should meet one-on-one with the protesters, later offering to meet with Xi himself to help reach a humanitarian solution to the unrest.

Joining me now to discuss is senior fellow and Director for Chinese Strategy at Hudson Institute, Michael Pillsbury. He's also an informal adviser to President Trump. Michael, good to have you on the program this morning.

MICHAEL PILLSBURY, SENIOR FELLOW AND DIRECTOR FOR CHINESE STRATEGY, HUDSON INSTITUTE: Hi. Thanks, Jim.

SCIUTTO: You've covered China for decades literally. You know the Chinese Communist Party. You know its fear of popular unrest. We don't have to remind people of Tiananmen Square in 1989. How concerned are you that China looks at these protests as a direct threat to its leadership and cracks down?

PILLSBURY: I am concerned, Jim. Back in '89, the Chinese Intelligence Service gave false reports to the Chinese leadership that there were foreign hostile forces in Tiananmen and that the students wanted to kill the leadership. Some of these documents came out many years later.

[10:20:00]

This same kind of false reporting could be happening now. We see this rhetoric in Beijing that America is behind these demonstrations. There's a so-called black hand, revealing the name of one of our political officers in the consulate, who is doing with any diplomat would do, interviewing people about what's going on. So the signs of danger are there.

SCIUTTO: That's concerning. And I saw those comments from China talking about U.S. influence there, and that worried me as well.

As you know, the president has been making some public comments of late on this. Early on, his comments were kind of both sides, urging restraint on both sides. Now, he's tying it to the trade deal, which is interesting, saying it would be hard to do a trade deal with Beijing if it would have cracked down. I mean, is that the right thing for the U.S. president to make it something of a bargaining chip in trade negotiations as opposed to an issue of democracy?

PILLSBURY: Well, I support what the president is doing. He's obviously got two challenges and he has to face them simultaneously.

On the one hand, in the trade talks, we came so close back in the first week of May that, really, 150-page secret agreement, I think, would have driven the stock market up a couple thousand points and the president would be greatly praised for it. And then it seems to have been pulled away for reasons that have to do with Chinese nationalism, that the enforcement mechanism wasn't acceptable in China.

The Hong Kong problem is very similar. The British deal that did include universal suffrage, a kind of democracy for Hong Kong, no rule by the Communist Party in Hong Kong. That's really important. That deal did not have an enforcement mechanism.

So now, rather than seeing Boris Johnson step up and say, you've got to enforce the agreement we made back in 1984, Mr. Xi, the British are silent. They're remarkable silent. It's their agreement. We have some say because we give special trade privileges to Hong Kong as long as it has what's called the highest level of autonomy. But the president has to juggle these two things.

I think his main goal, Jim, is what he's said many times, he doesn't want China to surpass America, at least not on his watch. So he's got to get that trade deal.

But obviously if there's a massive crackdown in Hong Kong with people killed, the media covering it, Tiananmen all over again, there's going to be automatic sanctions from around the world on China. Hong Kong will be a huge hit to the Chinese economic growth rate. I think some of the moderates in Beijing know that.

SCIUTTO: Let me ask you this, because, of course, there are domestic effects to the trade war as well. In the last hour, I had the president of the American Farmer's Union in Minnesota. I asked him who is winning the trade war, and his answer definitively was U.S. farmers are losing. He said U.S. farmers are losing big-time. What do you say to that, as there are domestic consequences to this, and at least in the near term, no sign of a resolution?

PILLSBURY: Well, absolutely. That's why the president postponed some of the tariffs on the Christmas products, not to have so much that's such a burden on --

SCIUTTO: That doesn't help farmers though.

PILLSBURY: No, I understand. Farmers have Christmas trees. But I think the main thing is the president has got a $16 billion program he wants to pay directly to farmers to ease the burden on this.

SCIUTTO: But the Farmer's Union president said that doesn't cover the losses. He said they've lost markets that they worked years to build in China. There are economic consequences.

PILLSBURY: And that's why the main thing is to get the deal. And the deal was so close back to early May. You know the 150 pages are secret. The Trump administration has been very, very successful at keeping the talks secret. And the Chinese reason for backing out has also been kept secret. So I think optimism is justified that if we get through the Hong Kong with an agreement, that they get some better approach to universal suffrage, no more calling them rioters by the Chinese government, and the Chinese come around on binding legal enforcement mechanisms, we're going to have a huge success.

I believe there's too much pessimism that this deal cannot be done. I think it can be done still.

SCIUTTO: Well, we'll watch the developments closely. Michael Pillsbury, nice to speak to you this morning.

PILLSBURY: Thanks, Jim.

SCIUTTO: Well, she has been widely criticized for her native American heritage claims, but now, Senator Elizabeth Warren is trying to flip that narrative. We're going to discuss. That's coming up.

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[10:25:00]

SCIUTTO: This morning, Elizabeth Warren joins several 2020 Democrats in Sioux City, Iowa to speak at a Native American presidential forum. Just last week, Warren released policy plans aimed at helping Native American communities. It comes after criticism of her claims of Native American ancestry, including a DNA test released by her campaign during the launch.

Joining me is CNN's M.J. Lee. M.J., you've been covering this campaign for some time. I'm wondering, in light of that controversial damaging start about her Native American claims, now a focus on policy proposals, is that successfully overriding that initial issue in the view of Native American communities?

M.J. LEE, CNN POLITICAL CORRESPONDENT: Well, you know, Jim, I think that's something we're going to get the answer to later today when she speaks. No doubt, this is a big moment for Elizabeth Warren and her campaign.

If you look at the last seven plus months of Warren running for campaign, this is not a campaign that has had sort of major blunders or missteps, but the issue of her family ancestry has been a major --

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