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Anthony Scaramucci is Interviewed about the Presidential Race; U.S. GDP Rises in Fourth Quarter; Longest Election in Decades; Ethics Investigation of Gaetz; Alabama to Conduct Execution. Aired 8:30-9a ET

Aired January 25, 2024 - 08:30   ET

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

[08:30:00]

ANTHONY SCARAMUCCI, FORMER WHITE HOUSE COMMUNICATIONS DIRECTOR: To Nikki Haley.

POPPY HARLOW, CNN ANCHOR: Yes.

SCARAMUCCI: They're trying to stay out of it so they don't end up on Donald Trump's radar screen. And I think she'll get those donors as well. She'll make a calculation how long to stay in the race. I think it would be very hard for her to leave the race prior to South Carolina, because she was the governor there. She was popular there. She may want to make a last political stand in '24 in South Carolina.

But let's say she surprises in South Carolina. Remember, you know, Newt Gingrich surprised everybody in 2012 in South Carolina. Then - then it becomes a real race coming into Super Tuesday.

But - but the money's there for Nikki Haley. And the money is there because people really know the danger of Donald Trump. They know that he's a threat to the institutions of the American democracy. Most of that money is from patriots. They're taking a position that they're patriots first and partisans second. And they don't want Donald Trump.

And - and, by the way, you know, if you look at the people that have worked for Donald Trump, if they're not politically motivated, they've been extremely honest about his behavior and his lack of executive capabilities.

PHIL MATTINGLY, CNN ANCHOR: Right.

SCARAMUCCI: And the dishonesty of his presidency.

MATTINGLY: It's -- there's no precedent for what we've seen from folks who used to work for him.

Wall Street guys also, though, make money because they're good at business, some of them, most of them. At what point do they start to --

SCARAMUCCI: A lot easier than politics, Phil, let me just tell you. I mean - MATTINGLY: I think - yes, you probably have some experience and understand that.

The -- when do they decide, all right, I need to put money on Trump because I have business interests that are going to be in front of the U.S. government? I've got to, you know, hedge my bets here to some degree.

SCARAMUCCI: I don't - I don't see it. I think - I think people are like, I've got to stay out of Trump's field of vision because he runs everybody over. The money that I give him is not necessarily going to help me with him. There's asymmetric loyalty when it comes to Trump. They threw that kid out of the party. I don't know if you saw that the other. That -- the kid was there taking pictures with one of Trump's lawyers who said that she was sick, but she really wasn't sick. And they tossed him. And he's - he's out there on Twitter saying, OK, this is how Trump people get treated by Donald Trump. I mean they're just objects in his field of vision.

And so what's interesting is that he will always find people, though, to join his movement. You know, he's got Tim Scott behind him, or Vivek Ramaswamy behind him. And - and they - they see a legion of people that have been wrecked by Donald Trump, but they don't care. And that's the - that's the blindness of the political ambition involved.

HARLOW: Businessman Doug Burgum, also governor, who said a couple weeks ago he wouldn't do business with Trump, was behind him that night too.

SCARAMUCCI: Yes. Well, look, you - they want to work in his cabinet. They see him as a potential victor and they want to work in his cabinet. I - I got that. I've been there, guys. I've been there. I've done that.

HARLOW: How many days?

SCARAMUCCI: Well, I was there for 11.

HARLOW: Yes. Yes.

SCARAMUCCI: But I did work for Donald Trump for eight months on the campaign.

HARLOW: Yes.

SCARAMUCCI: It was a fun experience. I wouldn't replace it. And it was very humbling. But there's a big message in what happened to me. It's going to happen to you. So, just be ready for it.

MATTINGLY: And there are plenty who have said that.

SCARAMUCCI: This is not the right guy to be president.

MATTINGLY: Anthony Scaramucci, always appreciate your time, sir. Thank you. SCARAMUCCI: Thank you.

HARLOW: Thank you.

We 285 days, who's counting, away from the general election, but it seems like it's already here in many ways. The changes to the campaign calendar that could make this the longest general race in decades.

(COMMERCIAL BREAK)

[08:37:56]

HARLOW: Economic data for you this morning. This just in. The Commerce Department reporting GDP. That's how much our economy grows. It grew 3.3 percent in the last three months of 2023. That's better than people expected. It's a key data point for the Federal Reserve as they get ready to meet next week.

Rahel Solomon has the numbers and the analysis, with us this morning.

Good morning.

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Good morning.

Yes, so, 3.3 percent on an annualized rate, as you said. That is stronger than expected. It's cooler than the quarter prior to that. But if you're looking at just the last few quarters, if you're looking at even the last few quarters before the pandemic, before sort of wonky things happened to the economy, this is still a pretty solid, healthy economy, at least according to this report.

So, if you look under the hood of the car there and look at sort of where we're seeing the most growth, the contributors, consumer spending, which I should say is a huge part of U.S. GDP. It's about two-thirds of GDP. So, consumer spending was strong for both goods and services, right? So, we're seeing really strong growth in spending in areas like accommodations. People are still traveling.

HARLOW: Yes.

SOLOMON: Going out to eat. We also saw positive and strong growth for government spending, for business inventory. So, you add it all up, you get 3.3 percent on an annualized rate. Two reasons why GDP matters to all of us. One, as you said, it's the broadest measure of the economy, of all the goods and services produced. So, it's a big picture look at the economy. The biggest picture of the economy. The other reason it matters, especially right now, is because of the Fed.

HARLOW: What do you think - yes, I wonder what you think it means for rate cuts.

SOLOMON: Well, I don't think that they're going to do anything differently next week.

HARLOW: Yes. OK. SOLOMON: Right, the first meeting of the year. There are eight meetings next year. They're going to hold rates steady. At least that is the - the by and large expectation. But then there's a question about the meeting after that. The March meeting. Forty percent of traders right now are expecting a rate cut at that meeting. If not then, then perhaps May. But a report like this is sort of the -- the sweet spot, if you will. It's not an economy that's overheating. It's not an economy that's rapidly cooling. It's sort of right in the sweet spot.

HARLOW: Goldilocks.

SOLOMON: And many economists would say that's exactly what the Fed is looking for, Goldilocks.

HARLOW: Just right.

SOLOMON: Yes.

HARLOW: Thank you, Rahel. Appreciate it.

SOLOMON: Yes.

HARLOW: Phil.

MATTINGLY: Well, Donald Trump's momentum rolling through Iowa and New Hampshire. A Biden/Trump rematch is looking more and more likely.

[08:40:03]

This general election right now feels like it's shaping up to be the longest in decades. Just in recent memory, Joe Biden didn't lock up the Democratic nomination in 2020 until April. In 2016, Trump didn't nail it down until May. And it took Hillary Clinton until June for the Democrats.

So, why is this general election different? Is it different?

We got the man who knows everything. CNN's senior data reporter Harry Enten joins us now.

So just how long are we talking about here?

HARRY ENTEN, CNN SENIOR DATA REPORTER: Yes, I mean, look, this primary season isn't quite over yet, like my Buffalo Bills' season is. But I know there are a lot of people who are looking forward to it being over, but we still have 285 days until the 2024 general election.

Just to give you an idea of how early it is, the first primary contest in 2020 didn't occur until February 3rd. So, we haven't even reached the beginning of last cycle's primary season beginning. So, we still have a long way to go.

And, all right, obviously Nikki Haley is still involved in this race. South Carolina doesn't occur until February 24th. Let's just say for whatever reason she decided to get out at that point. The earliest that a primary season has ended since 1972 was March 9th in 2000 when Bill Bradley and John McCain decided to leave their respective party races. So, that's the earliest. That's what we're potentially looking at.

The average since 1972 is late April. So, we are way before that. We could be looking at a very long cycle with Joe Biden not having anyone really going up against him at this particular point, no serious challengers, and, obviously, Donald Trump only having one challenger left in Nikki Haley.

MATTINGLY: Well, given how excited people are for this rematch, just palpable enthusiasm -

ENTEN: (INAUDIBLE).

MATTINGLY: I mean a long general election, how are people feeling about that?

ENTEN: They're feeling awful about this. In fact, dreading -- more people dread this election than looking forward to it. Among independents, more than 60 percent of independents say that they are dreading this general election. Only in the mid-30s on looking forward.

And that might be one of the reasons why if you look at the choice for president. RFK Jr. right now getting 22 percent of Quinnipiac University poll, 17 percent in a recent IPSOS poll. This is the best polling for an independent candidate at this point since 1992 and Ross Perot.

I'm not sure these people are necessarily behind RFK Jr., but there's this clear clamoring for a third option. And it's going to be very interesting to see, in this long general election cycle, whether one of those besides RFK emerges.

MATTINGLY: Yes, the expectation is they'll come home. Will they? We'll have to wait and see.

Harry, getting out in front on the Bills before I could chap with you about it, very impressive. Astute (INAUDIBLE).

ENTEN: I still am wearing the socks. I'll note that.

MATTINGLY: Thanks, buddy. Appreciate it.

HARLOW: Hanging on - hanging on to some hope here. Maybe next year.

ENTEN: Maybe next year.

HARLOW: All right, we have exclusive new reporting on the House ethics probe of Congressman Matt Gaetz. Who the committee wants to hear from now, ahead.

(COMMERCIAL BREAK)

[08:47:03] HARLOW: You are looking at images of Trump Tower on the left side of your screen. That is where Donald Trump just left moments ago. He's headed to the courthouse. On your right, that is E. Jean Carroll arriving at the courthouse for her defamation lawsuit against the former president. We're waiting to find out if Trump himself will take the stand and testify today. Court is expected to resume in less than an hour. It was adjourned for a couple of days because of a sick juror.

Also this morning, new details about the House Ethics Committee investigation into Republican Congressman Matt Gaetz. According to a source familiar with the committee's work, they've reached out to the woman who Gaetz allegedly had sexual relations with when she was 17- years-old, so a minor, something he has not been charged with and has repeatedly denied.

MATTINGLY: Now, sources also say the committee has reached out to the Department of Justice for materials relating to its investigation of Gaetz. The federal probe was concluded last year and brought no charges against Gaetz.

Joining us now is CNN chief legal affairs correspondent Paula Reid.

Paula, what more have we learned about this ongoing investigation?

PAULA REID, CNN CHIEF LEGAL AFFAIRS CORRESPONDENT: So, this is a new round of outreach from the House Ethics Committee. They've reached out to new witnesses. Of course the most notable is this woman who was still 17 when she allegedly had sex with the congressman.

Now, you may remember, the Justice Department investigated the congressman for several years. The investigation actually began until Trump-appointed Attorney General Bill Barr. And it started out with these allegations about sex with a minor. But then it expanded to look at potential sex trafficking, obstruction of justice, lobbying violations.

But the probe ended last year. We actually broke the news that they were not going to charge him. So, it is significant that now the House Ethics Committee wants to go back and potentially try to review the Justice Department's decision and get access to some of the evidence they had.

Now, I will note, the congressman continues to deny these allegations and in a statement he said, look, "this is not true, this has never been true. And those who spread those lies have been exposed, indicted, and imprisoned." There he is likely referring to his long- time friend and colleague, Joel Greenberg, who is in prison. He pleaded guilty to several crimes, including soliciting and having sex with that minor.

HARLOW: Talk about the politics here involved.

REID: Yes.

HARLOW: Because people will remember the ethics investigation when McCarthy was speaker and how that relationship went.

REID: Yes, it's really interesting to look at the parallel here because the ethics probe began in 2021. But then it decided, as they often do, to yield to the federal probe. But last year, in 2023, when the federal probe wrapped up, the ethics probe was also sort of re- upped. And Gaetz told people privately that he believed this was the fault of then House Speaker Kevin McCarthy. He couldn't believe that he allowed this to go forward. Now, Kevin McCarthy has publicly said he believes Gaetz's frustration over the ethics probe is a large part of why backed Gaetz backed that effort to push McCarthy out of the speakership. But now, of course, McCarthy's no longer speaker. And not only is this ethic probes continuing, it appears to be clearly escalating.

MATTINGLY: That's a fascinating blast radius to this whole thing.

REID: Right.

MATTINGLY: Switching gears a little bit to what we were talking about at the start of this. The Trump trial, what we expect today. There's a lot of question, is he going to testify?

[08:50:01]

If he does testify, will he stay within the bounds? What do you think?

REID: Yes, that's exactly what he wants us to be asking, right, is to drum up drama, because really this is a damaging trial. They're talking about how much he owes E. Jean Carroll for defamatory statement. It's interesting because in a damages trial he doesn't really have a lot to offer. The judge has put some pretty strict restrictions on what he can say. So, to most people you'd think, oh, probably not worth it. I don't have much to offer. But really what he wants to get out of this, his return on investment is really getting into any kind of conflict with the judge.

Now, so far they've really had to work hard to manufacture drama here. There's no big constitutional question, right? Instead, he's getting in trouble for not following basic rules that all of us would have to follow if we're in federal court. Don't be disruptive when a witness is talking. If you're a lawyer, you have to follow the federal rules of evidence, Alina Habba. But Trump and his attorney, Alina Habba, they have both repeatedly sparred with the judge over the basic rules that everyone else follows. They then run outside the courtroom and say, this is so unfair. This judge is so biased.

So, the thing about testifying is, even though he doesn't have a lot to offer, he could potentially get in trouble. It may serve this larger purpose, which is to try to get into it with the judge and then frame himself as a victim of an unfair system.

HARLOW: He was just on his social media site last night going after the judge.

Quickly, before you go, where do the criminal cases with the special counsel stand separate from today? REID: Yes, exactly. So, these are the two - two big criminal cases.

Arguably the greatest legal threats that he faces. But it's unclear if Jack Smith is going to be able to bring either one of his cases.

We thought that the federal election subversion case would be the first one to go. It was scheduled for March. But right now they're litigating larger questions about whether Trump has immunity. Legal experts don't expect he's going to prevail on those questions, but he absolutely has the right to litigate those. Right now we're waiting for the court of appeals to give us an answer. Then it could go to SCOTUS. And as important as the answer to that question is, the timing is even more important. How long does it take to get a final answer, thumbs up, thumbs down here, because the longer it takes to get a final resolution, the less likely it is that Jack Smith is going to be able to bring that case.

HARLOW: Just remind people what happens if he's in the general and elected, then what happens to Jack Smith's probes if they're so delayed?

REID: So we - so we also have the Mar-a-Lago case that's supposed to go in May. That too could be delayed. So, if former President Trump is re-elected, it is widely expected that he could make those cases go away. His attorney general could, you know, fire Jack Smith and the cases could be dissolved. The two cases that exist outside of that power are the Georgia case, you know, currently embroiled in its own scandals, and then also the Manhattan D.A.'s case here, the hush money case, that they argue deals with 2016 election subversion.

HARLOW: Thank you.

MATTINGLY: Paula Reid somehow managing to keep track of all of that and break news on the ethics investigation.

REID: With a 19-month-old.

MATTINGLY: With a -

REID: And a husband somewhere.

HARLOW: Good job.

MATTINGLY: That is remarkable. Thanks so much.

HARLOW: We hope you get home soon, after the trial today.

REID: Thank you.

HARLOW: Thank you.

MATTINGLY: Well, also today, Alabama could become the first state to execute a death row inmate using nitrogen gas. Critics call it torture and dangerous.

HARLOW: The man's already survived one execution attempt. How the state is preparing for this unprecedented second try. (COMMERCIAL BREAK)

[08:56:41]

MATTINGLY: Just in to CNN, the Alabama death row inmate set to be executed with nitrogen gas has made one more appeal to the Supreme Court to halt his execution. Now, the appeal comes a day after the Supreme Court and Alabama's 11th Circuit Court of Appeals refused to halt the execution of Kenneth Smith. Anti-death penalty advocates expressing fears that the execution would be, quote, "horrific and experimental."

HARLOW: Smith was sentenced to death for his role in a 1988 murder for hire plot. This will not be the first time the state has tried to execute him. Their last attempt, by lethal injection, failed in 2022. Smith described what that was like in this interview with NPR.

(BEGIN VIDEO CLIP)

KENNETH SMITH, DEATH ROW INMATE: I was strapped down, couldn't catch my breath. I was shaking like a leaf. I was absolutely alone in a room full of people, and not one of them tried to help me at all, and I was crying out for help. It was a month or so before I really started to come back to myself.

(END VIDEO CLIP)

HARLOW: Isabel Rosales is reporting on this, joins us outside of the prison where Smith is set to be executed in Atmore, Alabama.

Can you tell us what you're learning about this last-minute appeal to the Supreme Court?

ISABEL ROSALES, CNN NATIONAL CORRESPONDENT: Hey, Poppy, good morning to you.

Yes, we are certainly seeing the flurry of legal activity that we anticipate ahead of an execution. Yesterday, Smith's team received two legal rejections, one from the Supreme Court, who denied blocking the execution, and then one from the 11th Circuit Court of Appeals that not only denied blocking an injunction but also on the substance of their legal claims. So now Smith's team has gone to the Supreme Court, appealed, asking them to look at the actual substance of their cruel and unusual punishment claim.

Still, Poppy, that does not appear to be highly likely that they will grant appeal having been that the Supreme Court has already denied a temporary stay before. But that's still an open avenue for them.

Then there's also the governor, Governor Kay Ivy, who has the authority to grant Smith clemency, although she has said that she does not plan to do that. So, that is two last-minute options right here for Smith.

Now, in term of how the execution will work, I've been looking through the state of Alabama's execution procedures, a lot of it redacted just like you see here. And what we can expect is for Smith to be strapped into a gurney, a mask - a five-point mask to be put on him. The warden will read the death warrant, allow him to speak to make a final statement for up to two minutes, and then that mask will pump 100 percent nitrogen gas in. And they will be pumping that until he is deprived of oxygen until death.

Poppy.

MATTINGLY: Isabel, is the expectation that this will be the way executions are done going forward, or is this just a one-time thing?

ROSALES: Right. Well, critics are certainly claiming that this is going to open the door, that a lot of states are keeping an eye on Alabama and that this will open the door to future deaths by nitrogen gas. So far there's just three states that have approved nitrogen gas to be used as a form in a death sentence. But, listen, back in 2009, we saw a lot of states really struggling to get the drugs necessary for lethal injection after pharmaceutical companies denied selling that to prisons.

[09:00:05]

So, a lot of states have been struggling to figure out how to put inmates to death.

Now, the state in this case, they're saying that they're ready to go, that the plan here is for him to lose consciousness within seconds and die within minutes. Not everyone agrees.

MATTINGLY: Yes, no question about that.

Isabel Rosales, please keep us posted. Thank you very much for the reporting.

And "CNN NEWS CENTRAL" starts right now.