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New Report: Up to 40M Americans could be Evicted by End of Year; Amid Tension with N. Korea and Iran, Trump Advisers Hesitated to Give Military Options Over Fears He Might Start War; Rep. Ruben Gallego is Interviewed about Donald Trump, U.S. Troops in Germany, China Apps and Mail-in Voting; U.S. to Withdraw Nearly 12,000 Troops from Germany; Trump Issues Exec. Order Banning TikTok and WeChat in 45 Days; Postmaster General Says election Main will not be Slow Down; Biden Fires Back after Trump Accuses Him of Being "Against God"; Biden Clarifies Remarks about Black and Latino Voters. Aired 9:30-10p ET

Aired August 07, 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]

TOMAS PHILIPSON, FORMER ACTING CHAIRMAN, COUNCIL OF ECONOMIC ADVISER: It showed that 40 disposable income went up by 45 percent. Not because it took a huge dip in Q1, it was actually 3 percent growth, which is normal growth in Q1. But it went up by 45 percent. That is telling you that the fiscal overreaction has been quite stark.

And I don't honestly don't understand when the Democrats say we want to go big. I mean, do they want a double income in a pandemic as opposed to 45 percent gain? I think that's been missed, and therefore continued that, including down unemployment insurance benefits, which again, should not, I mean, if you want to help --

POPPY HARLOW, CNN HOST: Yes. All right.

PHILIPSON: -- or you can help, you don't have to tie it to not working.

HARLOW: Well, what would you do? You've got, you know, 14.6 percent unemployment for black Americans and a new report out of the Aspen Institute this morning, Tomas, that says 40 million Americans, 80 percent of them black and Latino could be evicted by the end of this year if things don't change.

PHILIPSON: You can help people financially. You just don't have to tie it with bad incentives of having -- the cash payments is one thing if you want to target those to certain people, that's fine. But don't pay them not to work. That's what unemployment insurance is implicitly.

HARLOW: But what are you --

PHILIPSON: And you certainly --

HARLOW: OK.

PHILIPSON: -- don't need to over pay them not to work as opposed to just partly replacing they're work income.

HARLOW: Listen to this. Listen to this from another guy who had your job a few years before you, Austan Goolsbee. Here's what he told me on the show yesterday. He said, look if the United States can't get control of this virus until we can we need to spend, "unlimited trillions of dollars."

I know you don't like the sound of that. Here's his argument.

(BEGIN VIDEO CLIP)

AUSTAN GOOLSBEE, FORMER CHAIRMAN, COUNCIL OF ECONOMIC ADVISER: There is one difference between now and the last crisis, which is this isn't really stimulus. We're not even yet to the spot where stimulus can work in the sense of government spending to try to get the economy moving again.

(END VIDEO CLIP)

HARLOW: Is he wrong?

PHILIPSON: No, I mean, everyone agrees that the government was basically reducing economic activity as a prevention for new when these stimulated the economy, to this stimulate the effects. And everyone agrees on that.

Everyone also agrees that we needed liquidity during that period. That doesn't mean you want to work incentives. And that doesn't mean that you think you can stimulate aggregate consumption or aggregate demand in general, which I think D.C. is kind of addicted to that kind of view, even though I think many economists don't believe it.

HARLOW: Tomas, I have so many more questions for you, so come back. We'll talk again soon. Thanks a lot.

PHILIPSON: OK. Thanks, Poppy.

HARLOW: All right, Jim.

JIM SCIUTTO, CNN HOST: Stunning details from inside the Trump administration. His top advisors feared President Trump might accidentally take the country to war. Some of my reporting from the new book coming up next.

(COMMERCIAL BREAK)

[09:37:12]

SCIUTTO: This just in to CNN, the Postmaster General Louis DeJoy, a big donor to the Trump campaign told the Postal Service Board of Governors this morning that he will not slow down election mail or any other mail. He also said he will not act based on any partisanship.

President Trump has in recent days criticized mail-in voting and the Postal Service as well ahead of the upcoming election in November. HARLOW: Well, this morning, new details from inside of the White House. This is your reporting, Jim, and it reveals that advisors to the President hesitated to give him military options amid escalating tension with both North Korea and Iran fearing might accidentally take the United States to war.

A lot of this is in your fascinating new book, "The Madman Theory: Trump Takes on the World." You haven't sign mine yet, Sciutto. Like my kids have spilled water on it. And you know, but you haven't signed yet. So I'm bringing it to you.

SCIUTTO: I promise to sign.

HARLOW: But let's -- seriously, let's get to this reporting because it's critical that this is how nervous they were about handing over critical information.

SCIUTTO: It is. This relates to one of the tensest moments between the U.S. and North Korea in late 2017 when, I'm told and on the record by the way, that the President's military advisors were reluctant to give him a broad range of military options because they were afraid he might use them and might unwittingly take this country and North Korea to war.

They also at the time, took the remarkable step of communicating to their North Korean counterparts that they did not know what the President would do, that he was so unpredictable. And by the way, it's a pattern that was not confined in North Korea at some of the tenses times between the U.S. and Iran in 2019.

Again, concern about military options, the extent to them and also communications, this time to Iran, another of America's most dangerous adversaries that they did not know what the President was going to do and communicating that, because they wanted to avoid escalation to a possible war.

Remarkable view to have your own president's decision making.

HARLOW: For sure. And I should note that, you know, I think one thing that makes your book stand out from so many others out there about the President and his thinking is that you talked to a number, of not only former administration officials, but current administration officials on the record, right, using their name and that makes a big difference whether it's General McMaster, Fiona Hill, Peter Navarro, Sue Gordon, or Steve Bannon, really looking at this objectively.

Tell us about the note cards.

SCIUTTO: Yes. So, this is an example of how the President takes in or doesn't take in frankly information.

Under HR McMaster, when he was a national security adviser, his team realized that the President was not reading his crucial briefing materials on some of the most crucial national security threats.

[09:40:01] They knew this because they would come in, speak about these threats. And the President was hearing them for the first time. So they developed a plan, they try to plan to boil down the briefings, to note cards with just three bullet points on them to see if that would get through.

What they found after a period of time was he was only reading the first two bullet points because, it was clear again in their conversations, he wasn't aware of all the information in the third. So they started concentrating the information just in those first two and kind of using the third as a throwaway line, but then over time found that he didn't even read those.

And beyond that, Poppy, and you and I've talked about this a lot, is the President and a lot of these briefings, when he would read or hear this advice or this intelligence, dismiss it. Say, I don't believe it.

HARLOW: Yes. Yes.

SCIUTTO: Even at times when the U.S. intelligence was very confident in their assessment. It's disturbing to hear.

HARLOW: Cannot. Just before we move on, Jim. OK, here's the front of the book. I love that you got baseball in here, of course, somehow with a baseball bat, but just talk about the title and talk about the madman theory.

SCIUTTO: So this relates back to Richard Nixon who deliberately utilized what he called, his team called the madman theory in relations with North Vietnam, he had Henry Kissinger deliberately communicate to North Vietnam that he was just mad enough to order a nuclear strike on that country. He didn't want to, he wasn't planning to, but it was intended to give leverage in negotiations with North Vietnam to end that war.

Of course, we know how that turned out, it did not end well for the U.S. So the theory didn't work in practice, but they still owned it.

The difference with President Trump is that his is less strategic and more accidental.

HARLOW: Yes.

SCIUTTO: A product of seat of the pants decision making. And by the way, Poppy, and this is key strategy that is used not only on U.S. adversaries, but us allies, and even --

HARLOW: Right.

SCIUTTO: -- members of his own staff.

HARLOW: I'm not sure when you had the time to write this after your other book. That seems like it just came out a few months ago, but bravo Jim, congratulations. And I hope everyone --

SCIUTTO: Patience, family. HARLOW: Yes, exactly. I hope everyone reads it. Congrats, Jim.

SCIUTTO: Thank you, Poppy.

HARLOW: Sure.

SCIUTTO: Joining us now to discuss this and other issues, Arizona Congressman Ruben Gallego. He's also a member of the Armed Services Committee, and a veteran himself.

Congressman, thanks so much for taking the time this morning.

REP. RUBEN GALLEGO (D-AZ), ARMED SERVICES COMMITTEE: Good morning. Thank you for having me.

SCIUTTO: So let's begin if I can, just very briefly, how concerning is it to you that there were instances where the President's own advisors had no idea what the President might do, and took the step of warning their counterparts about that?

GALLEGO: What's very dangerous -- when you're dealing with your allies and even your enemies, you actually need to be at least somewhat transparent, be predictable, because the worst thing that could happen is you could have either your allies or your enemies do a miscalculation, which could really easily strip us into either war or into a very bad situation that we will -- would be very difficult for us to recover especially when it comes to vis-a-vis holding our alliances together.

SCIUTTO: Yes, yes, the war you don't want.

I want to move on to an issue that I know is close to your heart. And that is the deployment of U.S. forces in Europe. The U.S. is now moving ahead with the President's order to significantly reduce the U.S. presence in Germany. You're pursuing legislation to block that move. Where does it stand? Do you have bipartisan support?

GALLEGO: I actually had very strong bipartisan support. I introduced an amendment to the defense budget this year, this coming year's defense budget that passed with overwhelming numbers of Democrats and Republicans and then passed out of the House.

So right now we have to go to conference committee negotiate with the Senate Republicans on it. But I think at the end of day, we're going to win this issue. Democrats and Republicans realize how important, strategic important it is for us to have our troops positioned in Germany. They're not just there to protect Germany. They're actually there more than anything else, protect us.

And it's a vital link to the Middle East, it's a vital link to Africa. If you talked to many Iraq War veterans, it was a stop on the way in. And sometimes, unfortunately, it was stopped on the way out if they were injured.

SCIUTTO: The President claims this is about national security. It's about strategy. It's about moving troops around the world. Do you believe that justification?

GALLEGO: No. I've sat in some classified briefings and some unclassified briefings about where they're going to move these troops. It doesn't make sense.

If you're trying to keep a deterrent force on -- in Europe, especially in, you know, Western Europe, where they want to move these troops is not going to encourage any type of our age in any way our NATO allies to trust that we're going to be there in case --

SCIUTTO: Yes.

GALLEGO: -- the balloon goes up. If anything, it's a great signal and a great gift to Russia that we are pulling further back, and that their aggression may not be met by a united front from NATO.

Strategically, I don't see where that is coming from.

SCIUTTO: And Kremlin was the only one to celebrate the move, frankly, none of the US allies did.

I want to move on to China, I can.

GALLEGO: Yes.

[09:45:00]

SCIUTTO: As you're aware, the President has now issued Executive Orders banning social media apps, not just TickTok but also WeChat, these are huge followings around the world, particularly in China. Is this a genuine national security threat in your view?

GALLEGO: It may be like there are a lot of ways that we can actually stop TikTok from taking personal information and using the Chinese. But what they like to do is gather as much information for further use in the future.

But, we really want to talk about national security threat. This President also basically gave away our fight when it came to Huawei and ZTE. True national Chinese telecoms that we know are involved in espionage, that we know will -- can potentially be used as back end attack methods by the Chinese government and spy agencies.

And the President last time he met with President Xi Jinping did not push back on Huawei. Actually gave in a lot when it came to actually our insistence that Huawei and ZTE be totally separated?

So, what bothers me is that I think he is more bothered by the fact that TikTok is used as a social media platform to attack him --

SCIUTTO: Yes.

GALLEGO: -- and not the fact that Huawei and ZTE, which we know are aggressively used by the Chinese government is used to extend the Chinese sphere of influence when it comes to government operations.

SCIUTTO: Yes. Yes.

GALLEGO: And that's what where we should be focusing on. But again, this is all about him and not about the national security of this country.

SCIUTTO: We should note that TikTok, a lot of users use that to fool the President's campaign regarding the Tulsa rally, to fool them into believing many more people were coming, whether that drove the decision, we don't know, but something to throw out there.

Finally, before I go, President continues to attack mail-in voting only in states run by Democrats, by the way, totally fine in states run by Republicans such as Florida.

The Postmaster General today, Louis DeJoy, he says the U.S. mail will not delay mail-in ballots. Do you believe that promise given the relationship between the Postmaster General and the President and broader efforts to suppress the vote?

GALLEGO: Absolutely not. Everything we see right now, you know, in regards to this President elections that he wants to make this election as difficult as possible for people to vote, and in the middle of a pandemic. And then he has sliding rules where if you're a red state, and you already have early voting, and he thinks is going to benefit him, he'll say that OK, that state is good, but other states are bad.

Look, we've been voting in Arizona for more than 30 years by VPM, vote by mail. It's safe, it's secure, and it's used by both partisan -- wide bipartisan support.

If you need to suppress the vote to win an election, you probably should not be present. And I think that's a good message that the President should think about

SCIUTTO: Yes. Even conservative commentators, George Will, for instance, drew attention to these efforts.

Congressman Ruben Gallego, thanks very much for joining us this morning.

GALLEGO: Thank you.

HARLOW: Interesting point about ZTE and Huawei there for sure.

OK, so the former Vice President Joe Biden responding after President Trump attacked his faith. He calls the President's remarks shameful, next.

(COMMERCIAL BREAK)

[09:52:36]

SCIUTTO: Presumptive Democratic presidential nominee Joe Biden is fighting back after the President made really just a baseless attack against the former vice president's faith. (BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: No religion, no anything. Hurt the Bible, hurt God. He's against God. He's against guns.

(END VIDEO CLIP)

HARLOW: Well, Biden, note, is a practicing Roman Catholic. He calls those comments shameful.

Let's go to Arlette Saenz. She covers the Biden camp.

Good morning. What else did the former vice president have to say?

ARLETTE SAENZ, CNN POLITICAL CORRESPONDENT: Well, Poppy, I think you can start right there. Joe Biden is a devout Catholic. So it's no surprise that he and his campaign really both strongly took issue with the President's comments. The campaign first put out a strongly worded statement against the President's comments. And then Biden himself weighed in on Twitter.

And what he said was, "For President Trump to attack my faith is shameful. It's beneath the office. He holds and it's beneath the dignity the American people so rightly expect and deserve from their leaders."

His wife, Jill Biden, did an event last night where she talked about how her husband's faith is unshakable. We've heard Biden on the campaign trail over and over talk about how his Catholic faith has not only shaped the way that he views a leadership role or policies, but that it's also carried him through some very tough times, including the death of his wife and young daughter, and then later the death of his son Beau. So, this is something that they are strongly going to continue to push back on the President against.

SCIUTTO: Yes. I mean, that part clearly hit him in the gut.

Biden had comments yesterday during an interview hosted by the National Association of Black Journalists cause some outrage and he tried to clean them up. So, what were the comments and what was his response to explain them?

SAENZ: Yes. So Biden had to do a little bit of cleanup mode yesterday. And these comments came during an interview with the NBJ -- NABJ and the NAHJ, two institutions for black and Hispanic journalists, and Biden seems to suggest that there is not diversity in thought within the African-American community. Take a listen to those comments.

(BEGIN VIDEO CLIP)

JOE BIDEN, (D) PRESUMPTIVE PRESIDENTIAL NOMINEE: And by the way, what you all know, but most people don't know, unlike the African-American community with notable exceptions, the Latino community is an incredibly diverse community with incredibly different attitudes about different things. [09:55:07]

You go to Florida you find a very different attitude about immigration in certain places than you do when you're in Arizona.

(END VIDEO CLIP)

SAENZ: Now, the Trump campaign quickly pounced on those comments, saying that he is insulting black voters. And late last night, Biden himself released a series of tweets where he said, "In no way did I mean to suggest the African-American community as a monolith, not by identity, not on issues, not at all."

He went on to say, "I've witnessed the diversity of thought, background and sentiment within the African-American community." And said he'll continue to fight for the African-American community going forward.

So clearly, he needed to do a little bit of damage control after those comments yesterday.

HARLOW: He did, for sure. Arlette, thank you very much.

We do have new numbers out this morning that show the economy added 1.8 million jobs in the month of July. It's an increase, but it's way down from the month before. The President's top economic advisor, Larry Kudlow, will join us ahead.

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