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Oil Prices Spike After Saudi Attack, U.S. Blames Iran; Donald Trump: U.S. "Locked and Loaded" After Saudi Oil Attack; Workers Strike Against General Motors In Biggest Walkout Since 2007. Aired 12-12.30p ET

Aired September 16, 2019 - 12:00   ET

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

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JOHN KING, CNN HOST, CNN NEWSROOM: Welcome to "Inside Politics." I'm John King. Thank you for sharing your day with us. Oil prices spike in the Middle East on edge following a tax on Saudi Arabia's energy infrastructure.

The Trump Administration blames Iran and the President says the U.S. is locked and loaded. Plus, the recurring presidential credibility question, aides rush today to say locked and loaded doesn't necessarily mean a military response. And the President insisting he never said something that he said clearly on camera and that was then repeated by two cabinet members.

And nearly 50,000 auto workers in states on strike, the General Motor says it has made a fair offer. Workers see it very differently.

(BEGIN VIDEO CLIP)

MICHAEL BURSON, GENERAL MOTOR EMPLOYEE: Job security would be nice so I keep this place open. We don't really have a car. It's scheduled to close. I just want to have a future. I don't mind working hard to get it, either, but give us something.

(END VIDEO CLIP)

KING: A lot of news to get to that hour including that important strike, but we begin with uncertainty in the Middle East after this weekend's attack on oil facilities in Saudi Arabia. We're closely, of course, watching oil prices. Take a look, crude oil prices spiking after Saudi Arabia's oil capacity effectively slashed in half by those attacks gas prices, heating oil, natural gas all up as well.

Top administration officials are meeting today at the White House amid ongoing discussions about the attack and Iran's possible role in it. They're also discussing options for U.S. response. President Trump this morning suggesting Iran might be responsible for the attacks, tweeting in part, "Now they, meaning Iran, say that they had nothing to do with the attack on Saudi Arabia. We'll see".

This comes after his Secretary of State was very quick to pin responsibility directly on Iran. Iran denying any role here. President Trump also tweeting over the weekend what many interpreted to be a threat of military action saying, we, "Are locked and loaded depending on verification but are waiting to hear from the kingdom as to who they believe was the cause of this attack and under what terms we would proceed".

The White House today, downplaying the idea that "locked and loaded' is by default a suggestion of military action. CNN's Nic Robertson joins us now live importantly from the Saudi capital of Riyadh. Nic, the President says he is waiting to hear from the Saudis. What are the Saudis saying?

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: The Saudis are saying that the missiles weren't fired from Yemen, which is what the Houthi rebels there had claimed. They're saying that they were Iranian missile systems that hit the petroleum facilities here, so they're clearly laying the blame for the weapons, at least, at Iran.

They're not saying yet specifically where they were fired from, only that it's not Yemen. They say they will get to the bottom of it. My understanding is there is more information to come on this at this time, but when you take what the Saudis are saying in concert what Secretary of State Mike Pompeo is saying, that the weapons systems weren't fired from Iraq to the north of Saudi Arabia, and they didn't come from the south as the Saudis say from Yemen, that really leaves one place, Iran.

Just to add a little context there, when the Saudis in the past have claimed that Iranian that the Houthis have fired Iranian made weapon systems at them before and they sent these weapon systems to the U.N. for confirmation that they were made in Iran. The U.N. has come back and confirmed some of that information.

So the Saudis have a track record of calling it right on Iranian-made weapon systems. We don't know yet if that's the case here. They haven't provided the evidence thus far, but that's the direction they seem to be traveling in at the moment, John.

KING: Nic Robertson with the latest from Riyadh, Saudi Arabia, great to have you in the Saudi Capital at this sensitive time. We'll stay in touch. With me in studio here to share the reporting and their insights CNN's Kylie Atwood, the Wall Street Journal's Michael Bender and Greg Ip also with the Journal.

Let's start with Kylie, the President tweeting, I want to wait, let me hear from the kingdom. Who they believe? Nic Robertson saying clearly though the Saudis are coming around to the same conclusion that Mike Pompeo the Secretary of State made right out of the box, Iran did this. If there is a compelling case to the White House that yes, Iran did this, what will the response be?

KYLIE ATWOOD, CNN NATIONAL SECURITY REPORTER: Well, that's what they're talking about at the White House today. It is interesting to see that there are a number of principals' meetings that are happening at the White House. It's different to some of the processes that we've seen come out of this White House when there have been incidents like this.

The question here is what are the options on the table and what is President Trump willing to do when Iran shot down a million - $11 million costing U.S. drone, the U.S, was thinking about military action but then Trump called it off hours before they actually took action.

What it is going to take for the President to take any action? I doesn't seem like allies in the region are really expecting the U.S. to forward but I talk to you some diplomats from the region who said it really is up to the U.S. here in terms what they decide to do before they make any decisions regionally about what their reaction is going to be.

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KING: And you see Secretary Pompeo is going to make some calls today. You see the President's tweet the original, "Locked and loaded" other aides at the White House saying well that doesn't necessarily mean military action. It means military actions they're trying to back track a little bit to buy space. Space for what?

MICHAEL BENDER, WHITE HOUSE REPORTER, THE WALL STREET JOURNAL: Well, some space for as Kylie was saying for if to see if Saudi will get out in front of this is and what they're going to say about this, because this really is first and foremost their issue. There are some timing issues here for the White House. It doesn't feel like there is a lot of urgency in the moment here to respond in the next 24 hours to Iran.

The President's schedule, in fact, would sort of suggest otherwise. He is going to be out of Washington for a couple days doing some campaign stops. It's unlikely say that the U.S. would lead strikes while the President is campaigning on the west coast.

So it does feel like there is some time here to let the Saudis get - figure out what they're going to say. They're sharing intelligence with Saudis our colleagues at the journal are reporting that American officials have shown them evidence, Intel, to show that these attacks have come from Iran.

And also you have the dynamic here with Congress and particularly a Republican Senate that is sort of reticent to get involved in what they view as a Saudi-Iran issue.

KING: And so as they have the evidence gathering, if you will, the intelligence gathering, the questions of possibly war and peace. You have attacks that have cut off about half of Saudi's production capacity, so you have the resource, the production issue, and then you have the tensions. What does that do in terms of the global economy which was already in an iffy place?

GREG IP, CHIEF ECONOMIC COMMENTATOR, THE WALL STREET JOURNAL: Well, it's obviously not good. Right now it's containable. We have the prices of oil up around $6 for the U.S. that's 0.2 percent of GDP. It's not a big deal. It's not zero. And there is some offset because U.S. oil producers will benefit a little bit from higher prices. Also the world knows that we have roughly a billion barrels of spare oil in various reserves that can cover six months of outages. For all those reasons, there is no reason to press the panic button. I think, which you want to worry about is the uncertainty factor, is there a wider sort of like conflict between Saudi and Iran that results in a higher cutoff of supply?

Could you have prices spiking $40? That would definitely be a big problem. Secondly this comes as we have all these other uncertainties going on, the trade war with China, Brexit, you know problems in India, Kashmir and so on. How much more uncertainty can the global economy take, possibly not a lot more?

KING: And do we know, or when will we know and I don't want to over simplify this, but if you're the average American and you're thinking this through, and you are a stressed economically, you might think, what is this going to do to me?

You might have the bigger conversations about what about Iran, what about this? But what is this going to do to you? If you look at gas prices during the Trump Presidency, they spiked and go up and down during just about every Presidency, sometimes it's because of things that Presidents. Sometimes the President has nothing to do with it but a President get blamed for it.

This President has been pretty lucky in the sense that gas prices throughout his Presidency have been relatively low, historically low if you look at it and you haven't had huge spikes because of all the events. As the President debates his diplomatic options, potential military options, he's also a President about to be up for reelection. If this goes on for a bit, what's the impact at the pump?

IP: Well, first of all, he knows us quite well, which is why the first policy response he's talked about is releasing oil from the strategic petroleum reserve. That's a very kind of like targeted response, which is probably one reason why we haven't seen a lot so far.

And as you say, prices have moved up and down a lot during his Presidency. We're at today's prices in oil just back in May. So there isn't any particular reason for consumers to look at the possible impact gas prices and say, this is a disaster. But it's kind of the headline risk.

Just as most people in businesses have not been directly hurt by the tariffs, it's all they read about, and now they're going to be reading about gas problems and oil production short shortages. It just adds to the mixture which we see has been very negative for confidences, especially for businesses.

BENDER: Great mentions, just real quick here John, Trump's response by releasing reserves. He is also tried to expedite called on his agencies to expedite pipeline production, some of these projects that are in the works in Texas and in other places, which is kind of interesting in that the release from the reserves should hold the markets over for a while. But meanwhile, this was a single biggest disruption since the first gulf war to oil markets. And even though the U.S. has become the largest producer of crude, that kind of disruption shows what sort of pivotal roles Saudi still play in global oil markets.

KING: Right, both there's a supply also there is a psychology of - this also a supply element and the psychology of the markets. Does it matter that the President is having these meetings today without a National Security Adviser? Does it matter that you have a turnover? John Bolton, just went out to Wall Street Journal Editorial Board, there is a lot of Wall Street Journal on the program today.

Here we go, but saying this morning, Mr. Trump, might also apologize to John Bolton who warned repeatedly that Iran would take advantage of perceived weakness in the White House. Mr. Bolton resigned last week over policy differences notably on Iran.

[12:10:00]

KING: The weekend's events proved that Former Advisor right. The Trump Administration's pressure campaign has been working and abandoning it now would encourage Tehran to take more military risks.

We don't need to get into the pluses and minuses of the argument there, but is there, you have Secretary Pompeo, you have a relatively new Defense Secretary in Secretary Esper. Does the absence of Bolton make a difference here?

ATWOOD: Of course it does. Without a National Security Adviser who has been with the President as Bolton has for over a year, I mean, the decision making is not as it traditionally is inside a White House, right? And so we should also note that the President is considering right now on whom he is going having step into those shoes?

So he's distracted to a degree from focusing on one thing. But I think it's important to note that, you know, the tweet that we saw from Secretary Pompeo over the weekend explicitly and quite immediately called out Iran for these attacks. That was before anyone else from the intelligence community was able to do so.

We still haven't seen any intelligence that explicitly says Iran was to blame, so even though John Bolton is gone and he was an Iran Hawk, there is still an Iran Hawk on the President's National Security team, and he is arguably one of the most vocal members of that team, and a member of the team that we know that the President listens to very often, and that's important to consider.

KING: its key point and an important point that if they stick with that, the question is what will they do about it? What are the options that you should note? They seem to be trying to bite some time to think this one through, consult around the world and everything, but an important question is, what do you do about it? If you directly blame Iran, what do you do about it?

When we come back more on this including, some confusion when the President speaks and then aides come out and say, what he really meant to say is something different.

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KING: Welcome back. President Trump's "Locked and loaded" rhetoric sparking new fears of possible war with Iran, but also creating a good deal with confusion. White House aides say don't take the President literally, that "Locked and loaded" doesn't automatically mean military force, is on the table, so confusion there. Now adding this, the President over the weekend lashing out saying the fake news as he calls it, wrongly reporting, he said he would meet with Iran without conditions. Incorrect, the President says.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT, UNITED STATES OF AMERICA: I would certainly meet with Iran if they wanted to meet. I don't know that they're ready yet. I would certainly be willing meet.

UNIDENTIFIED FEMALE: Do you have pre-conditions for that meeting?

TRUMP: No, pre-conditions, no. If they want to meet, I'll meet.

(END VIDEO CLIP)

KING: No pre-conditions that was the President of the United States, no pre-conditions. Two cabinet members repeated the "No pre- conditions" line just last week.

(BEGIN VIDEO CLIP)

STEVE MNUCHIN, TREASURY SECRETARY: I would say Secretary Pompeo and I and the President are completely aligned on our maximum pressure campaign. I think you know we've done more sanctions on Iran than anybody, and it's absolutely working. Now, the President has made clear he's happy to take a meeting with no pre-conditions, but we are maintaining the maximum pressure campaign.

(END VIDEO CLIP)

KING: I think you might have heard the words "No pre-conditions" there. Joining our conversation Jackie Kucinich with the Daily Beast CNN's Manu Raju and Rachael Bade with The Washington Post. It's a very serious issue the principles at the White House debating today, we're just talk a little bit about the potential war and peace consequences, the economic consequences.

As this plays out, is it not a big factor whether you're an American citizen, an American journalist or sitting in a global capital including Tehran trying to figure out what the White House is trying to say when the President contradicts himself or says I didn't say something when he clearly said it? Or when his aides come out and say, well, pay no attention to what the President says or don't take him literally? JACKIE KUCINICH, WASHINGTON BUREAU CHIEF, THE DAILY BEAST: I mean we've seen this not only with Iran but with lots of different situations on the international scale, and domestically, for that matter. Whether the President is doing this to confusion, whether he's doing it for some other reason that we're not thinking of?

It's one of the reasons that globally there is a lot of confusion in dealing with this White House, because they don't know if an Ambassador, if the Secretary of State is actually speaking for the President, and the President changes his mind so frequently, it does have - this is a consequence of that.

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: And what does the President actually want here and how does this align with what his own personal views are? Often you hear the President talking about retreating from the world, pulling back from military conflicts, trying to pull out from places like Afghanistan and the like, not wanting to be the global policeman, as he has said on multiple occasions.

But also want to project military might, so the President consistently has a conflict in his own message and what does he ultimately want to get out of here. Some claim that he even knows what the next steps are, which is probably one reason why they're showing some confusion.

BENDER: And that's more important if you're an ally here in a situation than an adversary like Iran. But what does it tell us, it tells us that Trump desperately wanted this meeting with Rouhani, but he still wants the meeting. Now that Iran has backed out of it knows that Iran is sort of drawn a border line saying this meeting is not going to happen, Trump is trying to get himself some wiggle room here to say that.

Remember that list of a dozen conditions that Pompeo put out, that's part of it. The "Locked and loaded," Trump is much more aggressive and much bolder on Twitter with his mobile phone than he is when it actually comes to taking action against some of these adversaries. He showed his - repeatedly in the first two and half years here and reluctance to do that.

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KING: And there is a credibility question when that happens, in the instances that happens there is also look, there are no good choices for the President here and there is no good choice for any President here whether it was Donald Trump or whether this was happening in Obama Administration or any other administration.

But this one also happens to happen as we head into a reelection campaign. So, on the one hand, the President trying to be muscular "Locked and loaded." Iran if it's - responsible you'll pay some consequence, whatever that consequence may be. At the same time, you see what's happening in the global energy market.

He's a President heading into a reelection cycle who has an economy that's already showing some signs of at least slowing and possibly tipping into recession. So the President tweeted today fear not. The American energy sector can fill in the blanks here. Don't worry about energy prices in a long run. It's just a hard one, anyway, but the timing of it makes it harder.

RACHAEL BADE, CONGRESSIONAL REPORTER, THE WASHINGTON POST: Yes, it's a tale of multiple Trumps in different things that he wants. I mean, he wants to look tough. He always likes to sort of show that he's out to - you hit me, I'm going to hit you harder. That's where the "Locked and loaded" rhetoric comes. And then he wants to ease people's concerns about any sort of economic recession, people feeling this in their pocketbook though because that he goes to a reelection.

At the same time it's sort of interesting to watch this from the Hill perspective because we've seen the President do this - you mentioned domestic politics. He says one thing and does something else. Lawmakers on the Hill have had a trouble of reading him for this very reason over and over again. But you had - today you see Senator Romney coming out and saying, specifically attacking Iran over this would be a great mistake.

Let them defend themselves, we're already selling them arms. So lawmakers are feeling the need to chime in, but over time as he makes these sorts of threats on Twitter, people are like, is this boy who cried wolf? They don't know when things are really serious and they need to really intervene and try to talk him back, or if this is just him, being Trump on Twitter and not real serious.

RAJU: And will America's adversaries even listen to these threats after a while and they even take it seriously, that's the real risk?

KING; But Romney's point is about that this is - this incident escalates dramatically but what has been a long running bloody civil war in which Iran is with the Houthi Rebels and Yemen. But guess what; the United States is with Saudi Arabia which has been responsible for a lot of bloodshed in Yemen, using American weapons at times, which is why you see the 2020 Democrats weighing in as well.

Tulsi Gabbard saying, very anti-war military veteran Trump awaits instructions from his Saudi masters having our country act as Saudi Arabia's - I'm not going to say the word, is not "America First." Beto O'Rourke says pretty much the same thing as President I will not go to war for Saudi Arabia.

Bernie Sanders making a broader point saying Mr. President which was a Congress, you make sure whatever decision you make, you should come to Congress first which not only this administration but past administrations Democrat and Republican have made the case in a situation, in an emergency they don't need to do that.

BENDER: I think that's right. You put all the Democratic talking points up there, but there is also a similar sentiment from the Republican majority in Congress right now, right? They are still sort of frustrated over the assassination of Khashoggi in Saudi Arabia not a lot of interest in running to help Saudi Arabia here. And they certainly don't want to go to the aide of the Houthies and instruct themselves into what a lot of Republicans in the Senate view as an Iran-Saudi battle.

KING: That's a great point there are the particulars of this attack on Saudi oil installations which will get the world's attention. But then there is the history not just of the President's mixed statements or confusing statements but the fact that they have coddled the Saudis after the Khashoggi murder, and a lot of people in both parties don't have a lot of love for the Saudis at the moment if you will.

Next for us nearly 50,000 GM workers in nine states walk off the job throwing at another ranch into the nation's economy.

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KING: More turmoil in the economy today because of a big strike against General Motors. The United auto workers called for the strike at mid night. More than 48,000 workers walking out of 31 Gm factories and 20 other facilities in nine states, Michigan, Ohio, New York, Kentucky, Tennessee, Texas, Missouri, Indiana and Kansas.

It's the auto industry's first big strike in a dozen years. You see some live pictures there of some picketers. The UAW complaining GM is putting profits ahead of wages and benefits for employees who helped turn the company around after bankruptcy and a Federal Bailout decade ago.

Negotiations do continue GM and the UAW have been at the table for a few hours now today President Trump weighing in on Twitter urging the parties to "Get together and make a deal". Kalea Hall joins me now. She covers the auto industry for the Detroit News. Kalea is this about one sticking point or is it a little bit of everything that has the parties apart?

KALEA HALL, AUTOMOTIVE REPORTER, THE DETROIT NEWS: John, there are multiple sticking points here. We have health care, we have wages, we have trying to get seniority for the temporary workers really several issues here which are very difficult to work through for both sides. It's hard to tell where they're at, at this point. But we know they're negotiating, right now, they've been negotiating since 10:00 this morning. I've been told that those negotiations are ongoing at this point.

KING: And you - I was told just before we came on the air that you had been in touch with GM in the middle of the negotiations saying they go on. The General Motors statement on Sunday says we presented a strong offer that improves wages, benefits and gross U.S. jobs in substantive ways and it's disappointing that the UAW leadership has chosen to strike.

We have negotiated in good faith and with a sense of urgency. That is the company's position. Take us inside the union calculation here. They could have had a strike at one or two plants? They could have done something less broad if you will, but they decided to go big. What's the strategy behind that?

HALL: Experts are saying the reason for that obviously--

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