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NYPD and Capitol Police Ramp Up Security Amid Possible Trump Arrest; Federal Reserve Huddles Amid Volatility in Banking Sector; White House Skeptical of Xi's Intentions as Peacemaker at Putin Summit. Aired 7-7:30a ET

Aired March 21, 2023 - 07:00   ET

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

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UNIDENTIFIED FEMALE: They're setting up barricades, there are security cameras that were just newly installed after Trump has called for protest on social media and rallied his base to, quote, take our nation back.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: He believes that this is a very big political plus for him, which is why he is fanning the flames.

ROBERT COSTELLO, ATTORNEY: If they want to go after Donald Trump and have solid evidence, so be it, but Michael Cohen is far from solid evidence.

MICHAEL COHEN, FORMER TRUMP ATTORNEY: The beauty that I have is I have facts, I have the truth, I have the documentation.

DON LEMON, CNN ANCHOR: Xi Jinping and Vladimir Putin will meet for a second day of talks at the Kremlin.

ALISYN CAMEROTA, CNN ANCHOR: This is a critical time in Russia's invasion of Ukraine and Xi is framing himself as a possible peacemaker.

UNIDENTIFIED MALE: Is there going to be a substantial Chinese contribution to the Russian war effort or is this just a bunch of talk? That remains to be seen.

UNIDENTIFIED FEMALE: The Federal Reserve begins meeting today to decide whether to raise interest rates again.

UNIDENTIFIED FEMALE: It's about who is going to be vulnerable as interest rates rise. And that could be companies, it could be consumers, it could be entire countries.

UNIDENTIFIED FEMALE: The U.S. banking system is significantly more secure than it was in 2008. The question, of course, is whether or not people believe that.

UNIDENTIFIED MALE: The second largest district in the nation, more than 1,000 schools in all, shut down by this strike.

UNIDENTIFIED MALE: We need to make a living wage.

UNIDENTIFIED MALE: I believe this strike could have been avoided, but it cannot be avoided without parties at the table.

UNIDENTIFIED MALE: Cracked in the air, deep center field, Thomas in the move. It's off the wall. Ohtani is in to score. Here comes the winning run. Japan turns it around on its last breath.

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LEMON: Were they excited there?

KAITLAN COLLINS, CNN ANCHOR: They went nuts. It was one of the greatest games. If you watched that walk off, I mean, it was amazing.

LEMON: Yes. A snapshot you just saw of what's on the menu.

But this morning, we're going to start with police ramping up security in New York City and Washington, D.C. as former President Trump calls on his supporters to protest and take our nation back.

So, here we go. I guess you can call it really a tale of two cities. Today is a day Trump claimed that he might be arrested and police have set up security fencing around the U.S. Capitol and the Manhattan District Attorney's Office.

To be clear, the Manhattan D.A. hasn't actually said if or when criminal charges might be coming in the Stormy Daniels hush money investigation. CNN has learned the NYPD has told all of its officers to be in uniform and ready to deploy today in the event that something does happen. So, let's hope it does not.

We want to bring in now our Senior Legal Affairs Correspondent Paula Reid. She's here with us covering the twists and turns. I don't know how you keep it all together as to what case you're covering here, because there have been so many.

PAULA REID, CNN SENIOR LEGAL AFFAIRS CORRESPONDENT: A lot of caffeine.

LEMON: Yes. Listen, it's not really tongue in cheek. It's truth, there is a lot, right?

REID: Yes.

LEMON: So, what did we learn yesterday as it relates to the Manhattan's D.A.'s case?

REID: Just a dramatic day down at the courthouse yesterday because this was really the last-ditch effort by the Trump team to try to prevent an indictment. They asked prosecutors to bring a witness before the grand jury to attack Michael Cohen's credibility, because, of course he is the witness really at the center of this hush money investigation. And this witness, this is someone who is well known in Trump's circles. He's represented a lot of Trump allies, of Rudy Giuliani and Steve Bannon. His name is Rob Costello.

And back in 2018 when federal investigators were looking at this whole hush money investigation, these two, Costello and Cohen, they had many different conversations. And Costello says that during those talks, Cohen told him that it was Cohen's idea to do the hush money payments. That directly contradicts Cohen's subsequent statements about how this all went down.

Now, after he testified, Costello gave a little press conference of sorts. He addressed reporters. Let's take a listen to what he said and how it contrasts with what Michael Cohen says.

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COSTELLO: The only thing I'm doing is trying to tell the truth to the grand jurors. Listen, if they want to go after Donald Trump and they have solid evidence, so be it, but Michael Cohen is far from solid evidence. This guy, by any prosecutor standard, and I used to be deputy chief of the criminal division in the Southern District of New York, I wouldn't have touched a guy like Michael Cohen, especially if he's a convicted perjurer.

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COHEN: I have truth. I have the documentation. Let me rephrase that, the district attorney has the documentation in order to validate every single statement that I've made.

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REID: So, filing their closing arguments in the court of public opinion, within the court that's actually making the decision, the grand jury. At this point, Don, we don't know if they have any more witnesses. We don't know if and when they will vote on a possible indictment. The only thing we know right now is that if there is an indictment this week, the former president's team said any initial appearance or arrest wouldn't take place until next week.

LEMON: Well, it's interesting that you have Bob Costello saying Michael Cohen is not credibility. But is Bob Costello credible?

REID: Look, I dealt with Bob for a long time. Like I said, he represents Rudy Giuliani, he represents Steve Bannon. In my experience as a reporter, he has never steered me wrong. But he has come under scrutiny for some of his decisions and in other investigations. But, ultimately, it's up to the grand jury. And it's interesting they could have called Michael Cohen to rebut his testimony and they didn't.

Now, will this be enough to change the grand jury's mind? Unlikely, but it certainly made for an interesting day at court.

LEMON: This is truly -- and I'm just not saying this, everyone is watching and waiting. And you're covering it. Thank you, Paula Reid. I appreciate it. Kaitlan?

COLLINS: Everyone is watching, but a big question is how we got here given this is something that has been reported for years now.

So, for more on this, I want to bring in Michael Rothfeld, who is an investigative reporter at The New York Times, was a member of the Pulitzer Prize-winning team at The Wall Street Journal that revealed the hush money deals involving Trump. He's also the co-author of the book, The Fixers, the Bottom Feeders, the Crooked Lawyers and Gossip Mongers and Porn Stars Who Created the 45th President. Quite a title there but you have been -- you were on the team that broke this story when you're working at The Wall Street Journal.

I think it's important to walk back through it because it is something that we have been talking about since 2016. Obviously, there's been a lot of investigations into Trump. So, kind of tell us how all of this got started, how we found out about the entire Stormy Daniels moment.

MICHAEL ROTHFELD, INVESTIGATIVE REPORTER, THE NEW YORK TIMES: Absolutely. This is -- it is a long story and it starts 17 years ago in 2006 at a golf tournament in Lake Tahoe in Nevada where Donald Trump was playing in this celebrity golf tournament. And he meets Stormy Daniels. We see a picture of them together right there at that golf tournament. And according to her, he invited her to dinner at his hotel suite one night after the tournament and they slept together. And then he promised her that he would put her on The Apprentice.

So, he never did that. And then flash to 2011, Trump is sort of waging a kind of run for president. You know, he tried several times. People said it was a publicity stunt. Stormy is upset she didn't get on The Apprentice tries to make money off of her story of sleeping with Trump. And she is unsuccessful. She does get a deal to sell it to a magazine but Michael Cohen, Trump's fixer, threatens the magazine and it never gets published.

COLLINS: Okay.

ROTHFELD: And then 2015, Trump is running again for president.

COLLINS: Actually running this time.

ROTHFELD: Actually running and is actually doing kind of well. And so, basically, Stormy sees another opportunity and she tries to sell it again through her agent in early 2016, but she can't sell it. And because --

COLLINS: No one is interested.

ROTHFELD: No one is interested.

And Trump also has known about the fact that she's out there all this time, has not bought her story, has not tried to silence her until we get to a month before the election.

COLLINS: Right. This is a critical timeline. This is like a critical juncture, the entire saga. ROTHFELD: This is really the crucial point that is what makes this potentially a campaign finance violation because Access Hollywood tape comes out, it's a month before the election and Trump is heard on tape talking about groping women and it's horrifically damaging to his campaign.

And so at that point, Stormy's people come out of the woodwork and say, hey, if it comes out now that he slept with a porn star, it is going to be really damaging to him. And so Michael Cohen, his fixer --

COLLINS: So, they're pitching it to The Enquirer this time?

ROTHFELD: Yes. The National Enquirer, David Pecker, the publisher, is a friend of Trump's. He had previously just a couple months before that paid off a playboy model to be silent, who also is Karen McDougal said she had an affair with Trump around the same time as Stormy Daniels slept with him. And so they're involved, they're trying to help Trump keep this quiet. And -- but they -- Pecker doesn't want to pay Stormy because he just paid this other woman $150,000. So, they refer to Michael Cohen, the fixer.

And so --

COLLINS: Which is just three days after his story is broken.

ROTHFELD: Three days after Access Hollywood.

So, this timing, the fact that she had tried to sell it for all these years and couldn't, but only now three days after Access Hollywood, a month before the election, Trump now is willing to buy this story. That's what prosecutors will argue makes it a campaign finance violation because that shows that it was related to his campaign and not just to protect his wife or something like that.

[07:10:09]

COLLINS: But was her assumption that they were going to publish this story? She didn't know at the time, her and her agent, that they were buying the story to kill it, to not let it be published?

ROTHFELD: No, Stormy knew what she was doing.

COLLINS: Okay. So, she knew that they were buying it and wasn't going to become public.

ROTHFELD: Yes. She basically wanted to make some money off this, at least to get some benefit because she felt she had been cheated after he promised her to put her on The Apprentice and he never did.

COLLINS: And so what's at the heart of this? Is it Cohen pays her the $130,000. He has a signed copy of the agreement we can see here. D.D. and P.P., those were the names, the aliases that were used to represent Trump and Stormy Daniels.

ROTHFELD: That's right.

COLLINS: Of course, then the election happens, Trump wins, and Trump reimburses Cohen, as we later learn, once he's in office.

ROTHFELD: Exactly. Trump agrees to pay Michael Cohen monthly installments and calls them legal fees, which they were not because Michael Cohen did not have a legal retainer. He actually didn't do any legal work for Trump while he was president during this period of time. So, that's what Alvin Bragg, the Manhattan D.A., is going to say were false business filings at the Trump Organization, saying that they were legal fees when, in fact, they were just a repayment for hush money.

COLLINS: And now we have Robert Costello who used to be an adviser to Michael Cohen that Paula was just talking about there who is the one who is now actively rebutting what Michael Cohen is saying.

ROTHFELD: That's right. Robert Costello -- after Cohen basically is under investigation, he hires Costello who is a friend of Giuliani, who is Trump's lawyer at the time, to try to help him get a pardon. And it doesn't really work out. They weren't really pardoning people. And Costello and Cohen had falling out. So now, Costello is used by Trump to try to undercut Cohen's credibility.

COLLINS: And we wait to see what happens with the indictment and what the actual charges look like, if there are any charges, really important to look back at all of this. Thank you for that refresher.

ROTHFELD: Thanks so much.

COLLINS: Great reporting on this, Michael. Thank you.

LEMON: That was a great layout, but triggering, bringing all of that back what happened in those years, and here we are now. Thank you, Kaitlan. Thank you, sir.

So, happening today, tens of thousands of Los Angeles school employees will begin a three-day strike. This includes bus drivers, cafeteria workers, janitors and other support staff. The impact stopping classes for half a million students. Workers say that they have been unable to negotiate a new contract for nearly a year and accused the district of unfair labor practices. Teachers have said that they will honor the strike and not cross the picket lines.

COLLINS: Also this morning, the Federal Reserve walking a pretty fine line as it is weighing its next move to tackle inflation. This two-day policy meeting that is coming in the midst of the biggest banking crisis the U.S. has seen since 2008. So, what is the fed going to do?

CNN's Christine Romans is here with her crystal ball to tell us. I mean, it's a really tough position for them to be in because they're deciding quickly right after all of this has happened. It's not like we had a lot of time to kind of marinate on this banking crisis.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: The crystal ball is completely cloudy at this point. I mean, I think the Fed was going to have to be looking at every piece of data up until the moment that they make this decision. And a reminder, this affects every single one of us. This affects the borrowing costs if you borrow money on a credit card, for a home loan, for an auto loan, but also it affects the economy. It affects jobs growth and clearly affects the banking system because all those rate hikes there have put some strain on the banking system.

Here is the menu of options, right? No rate hike, there are a lot of people who are saying that it would be prudent to pause right here. You're looking at the expectations, right, that most people think it is going to be 25 basis points. But there's a case here for no rate hike. Pause after all of the stress in the system. The con of that, though, is that it could spook the markets. It could be telling the markets, hey, wait a minute, you told us inflation was issue number one. Now, all of a sudden, you're worried about what do you see in the banking system.

25 basis points is the conventional wisdom. It shows the Fed is serious about financial stability and fighting inflation. Inflation is triple what the Fed would likely to see in terms of consumer prices. And then outlier there is a 50 basis-point rate hike.

A week-and-a-half ago, we thought that was in the bag, 50 basis points. It's what the European central bank did a few days ago because they wanted to show they were very serious about their fight against inflation, that, overall, inflation is the most important issue. I don't think very many people think there would be a 50 basis-point rate hike.

COLLINS: I want to quickly get your reaction to something we just learned, which is what Treasury Secretary Yellen is going to say at a banking association summit that she's speaking at today, where she's talking about the reaction from the federal government to what happened with SVB. She talked about their intervention being necessary to protect the broader U.S. banking system. This is what's interesting. Similar actions could be warranted if smaller institutions suffer deposit runs that pose the risk of contagion, basically saying, further rescues of depositors could happen.

ROMANS: I think that's a consensus. I talked to a couple people this morning who said, don't think that this is done, because I keep saying, do we put -- have we put a line under this crisis?

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And I think the consensus is the federal government has more it could do to prevent a run on confidence, if necessary, and they stand ready to do that. So, I think that that's her telling the world, look, we are on duty here, we see these strains in the system. We know that fear can spread even when there aren't reasons for the fear to spread. Fear is a very toxic thing in the banking industry. And the FDIC, the Treasury, the Federal Reserve are all standing ready with whatever tools they have to make sure fear doesn't overcome fundamentals in banking.

LEMON: Yes. You said a few days ago. I mean, it's like a few minutes ago when things change so quickly.

ROMANS: I know. The past 12 days or 11 days -- has it been 11 days? I don't know. But it's --

LEMON: It's been three months, Christine.

ROMAN: It's been two weekends in a row of just like everyone in banking, these regulars (ph), everyone is working around the clock.

COLLINS: Yes, non-stop. All right, Christine Romans, thank you. We'll see what they do.

LEMON: Vladimir Putin, Xi Jinping are about to hold their second day of talks at the Kremlin. Xi says that he is there on a peace mission. Why the White House isn't buying it, that's next.

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LEMON: So, the Biden administration denouncing Chinese Leader Xi Jinping's visit to Russia, saying it gives the Kremlin diplomatic cover to commit more in Ukraine.

[07:20:05]

Xi has been trying to portray Beijing as a potential peacemaker in the war. But White House fears China might send Russia lethal weapons. That's a concern.

Jeremy Diamond live for us this morning at the White House. Good morning, Jeremy. Xi and Putin are going to meet at the Kremlin next hour. What is the White House watching for?

JEREMY DIAMOND, CNN WHITE HOUSE CORRESPONDENT: Well, Don, the U.S. is watching these meetings very closely for a number of reasons. But if you listen to U.S. officials over the last 24 hours or so, one thing that they've really honed in on and expressed concerns about is the notion that China could reiterate its calls for a ceasefire in the war.

And that's not because U.S. officials don't want to see the fighting end in Ukraine. They say that the fighting could end if Russia simply pulled out its troops. But that's because U.S. officials say a ceasefire would merely serve to ratify territorial gains in Ukraine and give the Russians time to regroup and rearm and then choose to restart the war at a time of their choosing.

Tony Blinken, the secretary of state, said that it would essentially amount to a tactical move by Russia supported by China. And U.S. officials really want to dissuade the world of this notion that China is some kind of honest peace broker in this conflict. The secretary of state noted just yesterday that China -- that the Chinese president is traveling to Russia just days after the International Criminal Court issued an arrest warrant for Vladimir Putin on war crimes charges. And he said that Xi's visit essentially gives Putin more diplomatic cover to continue committing war crimes going forward.

One other thing U.S. officials are watching for is this possibility that China could decide to provide Russia with lethal weapons for its conflict in Ukraine. That's something that Chinese officials so far have not decided to do, but also U.S. officials say they haven't taken it off the table yet. And so we'll see if perhaps that's one of the outcomes of these meetings.

LEMON: Thank you very much. Jeremy, reminding us the sun is coming up, it's only time we get to see it when we go to a live shot to see what's happening outside. Thank you, Jeremy Diamond.

Kaitlan, the sun is up when she saw Jeremy's live shot.

COLLINS: Good to know.

Okay. As we talk more about what the White House is watching this morning, Xi and Putin's second day of talks is about to begin. The Kremlin says that the two leaders had a thorough exchange of views. That's the word they used, over more than four hours. And all of this comes as the Japanese prime minister has also travelled to Kyiv to meet with the Ukrainian President Zelenskyy there.

Joining us now for perspective is Washington Post Columnist Josh Rogin, who is also the author of the great book, Chaos Under Heaven, Trump, Xi and the Battle for the 21st Century. Good morning, Josh. We have been watching this. You so closely watch every word that these two leaders say given it's so highly choreographed. They've barely mentioned the invasion of Ukraine.

JOSH ROGIN, CNN POLITICAL ANALYST: Right, Kaitlan. Well, that's for a very simple reason, is that President Xi Jinping hasn't condemned the invasion of Ukraine. In fact, they blame the United States for the war in Ukraine. And this just goes to show you that the White House has a lot of very good reasons to be skeptical, as the Ukrainians do that, the Chinese government could be any sort of arbitrary or impassioned negotiator here.

I mean, let's face it, these guys are celebrating a war crime. They're celebrating the abduction and kidnapping of thousands of Ukrainian children. They are defending that -- the words -- speaking of words, the words that President Xi said were that China and Russia stand ready to guard the international order, okay, to stand guard over a world order that makes it safe for war crimes and repression and autocracy. So, yes, I think the chances that China plays a useful role in peace negotiations here are slim to none.

LEMON: All right. So, having said that then, you wonder how can China -- Xi take on this role of peacemaker, right, especially as they are considering sending lethal weapons to Russia. I mean, is he really taking on the role as peacemaker if he's considering sending weapons?

ROGIN: Right. I think, Don, what I'm saying here is that it's a ruse, okay, that he doesn't mean it, that it's meant to distract us from the fact that China, even before they send any weapons to Russia, is supporting the Russia war effort in Ukraine in a number of ways. They're buying the gas. They're helping them bust the sanctions.

They're already sending a bunch of drones and other nonlethal supplies to the Russian invading army and standing next to Vladimir Putin as he takes a victory lap for being indicted to war crimes is about a big of signal as you can send that what they are say and what they're doing are two different things. So, yes, they say they're a peacemaker but what I'm saying is that we have a lot of good reasons to suspect that's not true.

LEMON: Sleight of hand there.

COLLINS: Clearly. And, Josh, one thing, though, is the White House is watching this, though, is to see if China publicly calls for a ceasefire here. That's something that's broached during this meeting. I asked John Kirby from the National Security Council about this yesterday. This is what he told us.

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COLLINS: So, if they call for a ceasefire, you believe Ukraine should and will reject that?

JOHN KIRBY, NATIONAL SECURITY COUNCIL SPOKESMAN: Yes, we do. And we would reject it as well. We think that's an unacceptable outcome right now.

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COLLINS: Essentially arguing that because if there was one right now, it would give Russia the land that it has invaded so far, it would give them time to potentially regroup. What did you make of the White House's stance on that?

ROGIN: Right. I think, basically, they're correct that a ceasefire advantages Russia and disadvantages Ukraine at this stage of the war when we're expecting a new fighting season in the spring and summer. There is going to be a new fighting season. But what's kind of funny about that is that Vladimir Putin doesn't -- isn't for a ceasefire either. He has no intention of obeying any sort of ceasefire. So, it just goes to show you how sort of flimsy and disingenuous this Chinese peace push really is.

And there's going to be more fighting. We're going to enter a very bloody spring offensive and then a very bloody counteroffensive. And the question is, are we going to give the Ukrainians the means and the resources needed to prevail in that conflict to save their democracy so they don't find themselves in an even worse position next year.

And I think when we talk about a ceasefire, what we're talking about is that time is not really on Ukraine's side. That as it goes, the longer this goes on, the worse off they are. And that's why I think there's a big debate both in Congress and inside the administration, frankly, about whether to speed up the assistance so that they can win faster, because if we let this go on for too long eventually, these lines will get dug in and that spells disaster for the Ukrainians and horror for the people living on the Russian side of that line.

COLLINS: Yes. And they have major concerns about how much ammunition they're burning through in Ukraine as well. Josh Rogin, thank you so much for joining us with your perspective this morning.

ROGIN: Anytime.

COLLINS: All right. This morning, crowds, chaos, gun violence have all been plaguing Miami Beach this spring break. What city officials are saying about it.

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MAYOR DAN GELBER (D-MIAMI BEACH, FL): We don't want spring break. We don't ask for it. We don't advertise for it. We don't want people to come here for it. We don't think it's particularly good for our residential community. So, we don't want it.

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