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Democrats Score Victories Against White House Stonewall Strategy; Trump's Attorney on Tax Ruling: We Are Evaluating "All Appellate Options"; Key Testimony Underway From Former Ukraine Ambassador; The New York Times: Yovanovitch Testifies Trump Fired Me Based on "False Claims By People With Clearly Questionable Motive"; The New York Times: Yovanovitch Says Department Secretary of State Told Her Department Had Been Pressured by Trump to Fire Her Since Summer of 2018. Aired 12-12:30p ET

Aired October 11, 2019 - 12:00   ET

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

[12:00:00]

NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: --miles we told of the Saudi Port City and Jeddah on the Red Sea. The ship however continued to move during this period which gives you clear understanding that it is not heavily damaged but it is of course it comes so soon after the attacks from the Saudi oil facilities the Saudis were blaming essentially on Iran. So of course tensions rising and with it and again today the price of oil came.

KATE BOLDUAN, CNN HOST, CNN NEWSROOM: Absolutely, Nic. Thank you so much we really appreciate it. And thank you all so much for joining me. "Inside Politics" with Ryan Nobles starts right now.

RYAN NOBLES, CNN HOST, CNN NEWSROOM: And welcome to "Inside Politics" I'm Ryan Nobles, John King is off. A key player in the House Democrats impeachment inquiry is talking to members of Congress right now after the Trump White House lets her show up to testify.

Plus investigators now looking into Rudy Giuliani's business ties to two Ukrainians indicted by the feds and the President goes on a campaign rally spree in the face of the impeachment inquiry.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT, UNITED STATES OF AMERICA: We just got rid of the Russia hoax, and then a week later, the Ukraine hoax starts, the Democrats brazen attempt to overthrow our government will produce a backlash at the ballot box, the likes of which they have never ever seen before in the history of this country.

(END VIDEO CLIP)

NOBLES: We begin the hour, though, on Capitol Hill with a big moment and a big victory for the Democratic impeachment inquiry. Right now Marie Yovanovitch the Former U.S. Ambassador to Ukraine, the President called bad news in that infamous July 25th phone call is testifying behind closed doors, facing questions from three House Committees. Lawmakers hope Yovanovitch can hold back the curtain and tell them how and when decisions were about the freeze of military aid to Ukraine and who made them? That Yovanovitch is even on Capitol Hill today is a victory for Democrats against the White House stone wall strategy.

Until this morning, the administration has repeatedly and successfully denied Democrats the chance to interview the people around the President saying no to subpoena after subpoena. Another crack in the wall, lawyers for the U.S. Ambassador to the EU, who the administration blocked from testifying earlier in the week, now say he will comply with a congressional subpoena.

The new Democratic victories also come with a key loss in court for the President. The D.C. Circuit Court of Appeals ruling against President Trump and upholding a lower court decision that requires the President's accounting firm to turn over eight years of his tax returns to House Democratic investigators.

Today's ruling perhaps a signal that the White House's letter to Congress refusing to cooperate with the impeachment probe won't hold up in court. CNN's Manu Raju joins me live from Capitol Hill to set the scene.

Manu, Yovanovitch of course a key witness in this impeachment inquiry, what exactly are Democrats hoping to learn from her today?

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, they want to know about the circumstances around her dismissal earlier this spring. The President himself had targeted her, criticized her in that phone call with President of Ukraine Zelensky, the rough transcript showed the President of the United States criticizing her.

Also Rudy Giuliani had targeted her as part of an effort to essentially push for her ouster, as well as the Rudy Giuliani associates who arrested yesterday. They were all part of this effort and scheme of sorts that were alleged by prosecutors yesterday in part to push her out. These are all the questions that will undoubtedly be asked behind closed doors, exactly what happened there.

And we got a read about some of the things that are happening behind closed doors. Eleanor Holmes Norton, who was a Congresswoman sitting on one of the three committees interviewing the witness emerged from the closed door facility and she said that nobody, that Yovanovitch has not indicated whether or not anybody has prevented her from testifying.

Now, that is a key question because we had wondered whether or not the state, she was defying the State Department - the State Department trying to prevent her from testifying because she is still a current state employee but she has not indicated that yet at this moment. At the same time, she says that Yovanovitch has been trying to clear up false statements about her.

This could be in relation to what the Republicans have been saying, is that she was disloyal to the President, she had criticized the President, and she deserved her ouster, perhaps she's trying to clear that up and, also Norton said that they're getting into the topics about Rudy Giuliani right now, and according to Norton, this is getting "Very, very deep". So we'll learn details as the day emerges but already some interesting answers. Ryan.

NOBLES: Manu, another busy day of you waiting behind there in front of closed doors on Capitol Hill. Get back to us if you learn anything more. Manu, thank you.

Here with me now to share the reporting and their insights, Julie Pace with the Associated Press, Jackie Kucinich with "The Daily Beast", Sahil Kapur from "Bloomberg" and Lisa Lerer with "The New York Times."

Well, obviously there's a lot happening today that we're not going to hear about, Julie, because it's all happening behind closed doors. This is a pretty significant victory for Democrats that she is even here today. What's at stake for the White House?

JULIE PACE, WASHINGTON BUREAU CHIEF, ASSOCIATED PRESS: Right, the mere fact that she showed up was actually kind of in question this morning because we've seen from the White House basically this refusal to have anybody in the administration cooperate, and she is still a foreign service officer. And so there was a question of whether she was going to show up on her own.

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PACE: I think what we need to sort through right now is the fact that she's there, a sign that despite this really tough public line that the White House is taking, they actually are going to essentially let some people go forward and meet with lawmakers or is she defying the order.

Is she saying I am going to go forward with this, despite what the White House has said? I think that's really significant in terms of what happened going forward because we know Democrats want to talk to probably dozens of other people who are in the administration.

JACKIE KUCINICH, WASHINGTON BUREAU CHIEF, THE DAILY BEAST: And we know that the EU Ambassador, Sondland is actually going to show up after he was pulled back like an hour and a half before the Committee was supposed to interview him. Now he is scheduled to come forward. Maybe she did, she started something and we're going to see more of these officials walk by us into and behind closed doors.

LISA LERER, NATIONAL POLITICAL REPORTER, THE NEW YORK TIMES: Yes, there is this history throughout the Trump Administration where we have seen this kind of mini, quiet, I hesitate to call it an uprising, but the civil service kind of biting back a little bit.

I remember in the very beginning when he was first put in office, there would be rogue tweets from the National Park Service, and you know, National Park correctly things he said or whatever. So there is this history of these people who have been in government for decades like these two foreign service officials who are going to testify who, you know, have these private qualms with how business is being done in this administration coming forward and sort of small ways. Maybe that's part of what's happening. I don't know.

NOBLES: Let's look at who's scheduled to be on Capitol Hill this week, and it's a mix of people, that loyal to President Trump and some that are career officials, we know, Yovanovitch on the Hill today, Dr. Fiona Hill, she is a Former Adviser to President Trump in Russia. You have U.S. State Department Deputy Assistant Secretary George Kent is supposed to be there on October 15th.

Sondland, of course, this is a Trump guy, donated a million dollars to his inaugural, and then you have a couple of other people that could testify later this week. What should we take from this? This is going to be a long list of people that are going to appear in front of these committees.

SAHIL KAPUR, NATIONAL POLITICAL REPORTER, BLOOMBERG: Right, there are lots of tentacles to this. I think one person that Democrats have their eye on closely is Bill Taylor, who is the official who raised questions about a quid pro quo.

NOBLES: And they don't have an official date for him yet.

KAPUR: And they don't but yes, he used those exact words and seemed to sniff out that there was something going on behind the scenes. I think that's particular interest to Democrats. Big picture, I think they are trying to gather the evidence they can though either end up with a full body, a full story that they can tell or they will end up if the administration stone walls with articles of obstruction of justice, obstruction of Congress.

So one way or another I think most Democrats in the House think what the President said in public and on camera, on the White House Lawn is enough of an impeachable offense. This is just about, you know, what the articles end up looking like.

LERER: They need to make their own choices, though, Democrats about not only do they go with obstruction or broader impeachment, do they expand the inquiry, there's some energy on Capitol Hill for people who want to expand beyond just Ukraine, maybe look at what was going on in China and other, you know, this new revelation about this Turkish, Iranian gold trader, and Rudy Giuliani, and complications there.

And there's, you know, political arguments to be made on either side for keeping it more discreet or for broadening it out.

KUCINICH: Use the words complications, it gets complicated and they want to be able to message to voters to be simple, like A to B. Quid pro quo, something you hear them talking about a lot. And they want to be able to message this effectively.

And I think on the other side of that, what you're hearing is we need to keep this just in the Ukraine situation. When they're out in the world and talking to people, it's a very simple explanation, rather than Rudy Giuliani and gold traders and whatnot?

KAPUR: This is what the key point, obstruction itself is not enough. That's a tough political argument to make, even if it's legally extremely important, it's a tough political argument to make to voters, that we tried to investigate, they stopped us, and therefore we're impeaching for that reason they want something like that.

PACE: It was one of the reasons they held off in taking the Mueller report, and trying to move forward on impeachment because ultimately where Trump was tied into it was on obstruction.

NOBLES: And I do think that this is a key point, and could be a strategy from the White House, right? The more we confuse the public, the better that works to our, and I wonder if that has to do with Sondland now agreeing to testifying, and we want to read the statement from his counsel today announcing that he is going to appear in front of the Committee and says, notwithstanding the State Department's current direction not to testify, Ambassador Sondland will honor the Committee subpoena and he looks forward to testifying on Thursday.

The Ambassador does not control the disposition of his documents by federal law and regulation. The State Department has the sole authority to produce such documents and Ambassador Sondland hopes the materials will be shared with the Committee in advance of his Thursday testimony.

Jackie, again we want to point the distinction between the folks that are career State Department officials and folks that were put in place by the Trump Administration. Could there be a strategy here that Sondland goes in to this hearing with the goal of making Trump look better?

KUCINICH: Absolutely. Perhaps that's why he changed his mind because he thinks he can help. That said, they have a lot of documented, you have career foreign service people appearing before him. So they will have a body of work to be working with.

[12:10:00]

KUCINICH: They also have those text messages where we see already Sondland having communications with other foreign service officers and that big gap between when they were text messaging about what was going on in Ukraine, and then all of a sudden he disappeared kind of overnight, and then changed his tune and said we shouldn't talk about this anymore, the President was very clear, and there's reporting that he called President Trump during that period.

PACE: What we're told and I think this lends to the idea that Sondland is going to go before lawmakers and present a positive picture for Trump. In that roughly five-hour period he had a phone conversation with Trump in which he asked, was this a quid pro quo, and he was told no.

He felt comfortable then texting back saying the President has been very clear. So if he's going in there without any documents, if State Department is going to hold onto his documents and he is only going to be able to give his own perspective, his own words and that's what he is going to lean on assurances from Trump. You can see why the administration might feel comfortable having him go before lawmakers. KAPUR: If it's he said, she said, and Sondland can just stick by his he said version, in contrast to what Bill Taylor said which he seemed to be - there was something more.

NOBLES: And speaking of all the President's men, there is a particular former official who we had not heard from in totality that we may, that is John Bolton. The Washington Post reporting within minutes, senior officials including National Security Advisor John Bolton were being pinged by subordinates about problems about what the President said to his Ukrainian counterpart?

Bolton and others scrambled to obtain a rough transcript that was already being locked down on a highly classified computer network. We don't know what John Bolton thinks about everything that has happened here over the past few months. Lisa, should the White House be worried that when John Bolton finally breaks his silence, that could be trouble for them?

LERER: I think there's a lot the White House should be worried about right now. Sure. They should be worried about that. It's funny because at the beginning of this whole inquiry, the White House was really trying to discredit the whistleblower and that seemed like the strategy and that just becoming impossible to do because story after story and person after person is coming out is sort of verifying that account in a lot of ways.

So yes, I think anyone who comes out carries a certain measure of risk and I would suspect that if it's clear that the White House wants as few people to talk as possible.

KUCINICH: And think about how he left? Bolton did not leave on good terms with the White House, and there were a lot of hard feelings, and he has shown willingness to, like, put everything out there, in other instances.

KAPUR: How ironic if John Bolton ends up becoming the resistance here.

KUCINICH: We did see an ending like that.

NOBLES: We just have something new, guys, we have the official opening statement of Yovanovitch, "The New York Times" initially obtaining this, and I want to read a section of it.

She testifies to the Committee "Although I understand that I served at the pleasure of the President, I was nevertheless incredulous that the U.S. government chose to remove an Ambassador based on as best as I can tell unfounded and false claims by people with clearly questionable motives. To make matters worse, all of this occurred during an especially challenging time in bilateral relations with a newly elected Ukrainian President. This was precisely the time when continuity in the embassy in Ukraine was most needed".

All right, we just got this and let's go back to Capitol Hill now, and Manu Raju is standing by. This is obviously only a slice of what her testimony is going to be, Manu. But it appears that she's not going to hold back, at least from her perspective as to how the Trump Administration handled her being called back from her post in Ukraine?

RAJU: Yes and she makes it very clear, she was very frustrated about his dismissal, dismayed, she said because she believed that she was the target of an unfair, unfounded, inaccurate smear campaign against her.

She had no reason, understanding why this occurred, but she was told, interestingly about that the President wanted her gone, in her words, since the summer of 2018. She said that she had been told from department officials when she was dismissed, the department had been under pressure from the President to remove me since the summer of 2018, and that he had lost confidence in her in the position.

She was abruptly told to return back to Washington earlier in spring, and was told exactly that, and she goes into a litany of things that she says are simply not true. She says that she never met Hunter Biden, for one, who has been one of the questions that had been raised about her.

She says she was never disloyal to the President, which had been a main allegation about her, which is one reason she had been pushed out of the post, and she makes it very clear that she didn't do anything.

She said the Obama Administration did not ask me to help the Clinton Planet Campaign or harm the Trump Campaign as one of the allegations that have been raised about her.

[12:15:00]

RAJU: So she's trying to make very clear that she was unfairly targeted. She does not believe the reason why? Now there are still questions about what she knew about the circumstances around that July phone call with President Zelensky? She does say here that that occurred after she left but she makes it clear here she should not have been dismissed from the post, there was no reason to.

But the President wanted her gone for about a year, and eventually got her out of the position. Expect that to be a dominant line of questioning as members continue to press her behind the scenes here Ryan.

NOBLES: And Manu, I know you have been talking to members of Congress as to what their expectations were for her testimony today? Does this fall in line with what they thought? Did they expect her to be as forthcoming, as it turns out that she is going to be at least based on this initial statement that we're reading?

RAJU: It was unclear. I can tell you, heading into today's testimony, there were a lot of questions about what she would answer, whether she would appear, particularly in light that she's still a member at State Department employee, but she has not indicated whether or not she has been prevented in any way from testifying.

She has not indicated at the moment, whether she's defying orders from the State Department of course this could change. We've heard just got one lead about 15-20 minutes ago so we'll see if anything has come up since then. Members really do not know. They were preparing for the possibility that she would reveal a lot of the information.

It's still unclear, too, what documentation she may have to further corroborate her claims, but nevertheless, she makes it clear, laying out a clear time line of events that led to her dismissal, and saying that it was something that was simply not - it was totally unfounded, totally baseless in her view for the reason she was abruptly dismissed from her post, which all leads to a lot of questions about why the President took that step? And whether this had anything to do with his push towards Ukrainian government to investigate the Bidens?

And she makes clear in her statement that she never asked for any effort like that, any investigation into the Bidens. She makes clear that she did not try to pressure the Ukrainian government to launch any investigation in any way. This is one area that she's trying to clear up, amid questions about exactly what happened here Ryan.

NOBLES: All right, Manu Raju, already a very significant development from this testimony from the Former Ambassador to the Ukraine. We're going to give our panel an opportunity to read through this opening statement and digest this news. I'll take a short break and when we come back we will talk more about it. Stay with us.

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[12:20:00]

NOBLES: Welcome back to "Inside Politics" and we do have some developments on Capitol Hill. That's where Marie Yovanovitch, she is the Former U.S. Ambassador to Ukraine is testifying behind closed doors with trio of House Committees.

We do have for the first time her opening statement to these Committees and it is a pretty scathing indictment of the Trump Administration and how they handled her removal from that post.

Joining my panel now to discuss this new development, Michael Zeldin, Legal Analyst, Former Associate in the FBI. And I want to read for you guys a couple of different moments from this opening statement. It's pretty lengthy. She gets into a lot of different aspects of the controversy.

Let me read you this first bit, and she's talking here about John Sullivan, who is a Deputy, one of the top deputies to the Secretary of State, Michael Pompeo and is rumored to become the next Ambassador to Russia. And this is what Yovanovitch says, "He being Sullivan said that the President had lost confidence in me and no longer wished me to serve as his Ambassador. He added there had been a concerted campaign against me and that the department had been under pressure from the President to remove me since the summer of 2018".

So Julie, I think we knew this. This was an accusation against the Trump White House, but to see it actually spelled out here in such specificity is startling.

PACE: And this is why her testimony was so important for Democrats. There have been a lot --there's been a lot of speculation about what happened here. It was known publicly that there was this effort by Rudy Giuliani, backed up by other Trump allies to try to remove her, and the question was basically what did that look like from the inside?

What did it look like from her perspective? What were people who were not on the outside, people like Rudy Giuliani, people in an official capacity, what were they seeing? What were they saying? And how close did this get to President Trump?

Ultimately, that's what we have to remember in this whole circus. You have a lot of names flying at you right now, a lot of new characters but ultimately the question is what was the President's role in trying to maneuver Ukrainian officials and other people to try to clear the way for his desire to have Joe Biden investigated?

NOBLES: At least if you go by her perspective of it, the President and at least people very close to him were very involved in it.

KAPUR: Yes, the summer of 2018 is an interesting time line, if that's when theoretically some of this stuff began, and that's when they were laying the ground work to do this, it seems like a big part of her opening statement was dispelling a lot of things said about her.

Let me just name a few, she said she never asked Ukraine in any way to stop investigating corruption. She was not disloyal to the President. She never met Hunter Biden. She had minimal contact with Rudy Giuliani, and none about the issues at hand.

What we are seeing from her is what we have seen from a number of Trump Administration officials when they feel conflicted between loyalty to the President and loyalty to their oath, their job, the country itself. Some of them go one way, some go the other way.

[12:25:00]

KAPUR: Jeff Sessions had that problem.

NOBLES: Right. And I guess, Jackie, the question now is if she finds herself in the middle of all of this, will she now become a target by President Trump and his supporters? And try and discredit her.

KUCINICH: She's already become a target. You saw her mentioned in the Ukrainian, the call with the Ukrainian President as someone who had issues or something like that. So that is the play book. That is what they do. So there is no reason to think that that won't happen now.

She's, you know, someone who's been a career diplomat for 33 years, I don't know in that capacity, but she's a long time civil servant, so it is not beyond the realm of possibility there are going to be people looking through her background trying to find some connection to Democrats no matter how ten uses.

NOBLES: And speaking of that, this idea of kind of a commitment to civil service, she talked about that pretty extensively in this opening statement as well. She said "Today we see the State Department attacked and hollowed out from within. State Department leadership with Congress needs to take action now to defend this great institution and its thousands of loyal and effective employees. We need to rebuild diplomacy as the first resort to advance America's interests and the front line of America's defense. I fear that not doing so will harm our nation's interests, perhaps irreparably. That harm will come not just from the inevitable and continuing resignation and loss of many of this nation's most loyal and talented public servants.

Michael you're somebody that worked with a lot of civil servants over the course of your career.

MICHAEL ZELDIN, ROBERT MUELLER'S FORME SPECIAL ASSISTANT AT DOJ: I was one.

NOBLES: You were one. That's right. Can you see her frustration here as someone who didn't get into this for politics but got into it to serve her country, and feeling that she wasn't able to do that?

ZELDIN: Absolutely. What it says to everybody who reads this is my days in government are done. I tried my best over 30 years to represent the interests of the United States in this period of 2018. I was essentially denied the ability to do my job. That's a mistake. And it's rampant within the Department of State.

NOBLES: And we're seeing this not just from her but other State Department officials who for sometime have slowly moved themselves away from the Trump Administration because they felt they couldn't do their jobs.

PACE: This is a department that has had pretty low moral since the start of the Trump Administration. And so I think you have to put this fully in context of that, this is a department where people have felt like the work that they were doing wasn't respected, like the work they were doing wasn't understood by the White House.

There was hope that Mike Pompeo when he came in would try to sort of give them a boost, would try to reestablish some normal order and some normal processes. And what you're seeing here, I think, is just the reality that even if that happened, maybe at some lower levels, Trump has sort of operated differently, and he has seen avenues to have, I mean, what we're talking about is a foreign policy outside of the normal channels of the State Department.

For people who have spent their entire career working through those regular channels, this has to be incredibly dispiriting.

ZELDIN: There's something that is so interesting about this, of course, is that we have seen with the indictment of the two individuals for campaign finance, there was a concerted effort to remove this Ambassador from Ukraine, and it's not clear why?

I mean, her statement says I have done none of the things that are in the public domain about me, but nonetheless, there was a concerted effort by Giuliani and associates and then the President, to remove her because she was in the way of something. What that something is has not been well articulated and that's something we have to keep our eye on.

NOBLES: All right, let's hold that thought because we're going to get into the Rudy Giuliani aspect of all of this because he's mentioned in this particular opening statement. There's a lot of news about him today as well. So when we come back, our panel will dissect Rudy Giuliani's role in all of this when we come back on "Inside Politics."

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