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Judge Releases List Of Items Seized From Trump's Mar-a-Lago Home; Inventory Reveals Classified Docs Mixed With Clothes & Gifts; Investigators Retrieve 11,000+ U.S. Govt. Docs From Trump Home; Biden On August Jobs Report: America "Continues Its Comeback"; Wages Continue To Climb, But Not As Fast As Inflation; Consumer Sentiment Rises To Three-Month High, Up 13 Percent From July; Biden's Midterm Message: A Choice Between Democracy And Trump; Biden: U.S. Faces "Inflection Point" That Will Decide If Democracy Survives. Aired 12- 12:30p ET

Aired September 02, 2022 - 12:00   ET

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

[12:00:00]

RYAN YOUNG, CNN NATIONAL CORRESPONDENT: I'm going to turn up on the other side here. So, we understand, things are changing, but people are still desperate for water, especially businesses and the schools that haven't reopened. Erica?

ERICA HILL, CNN ANCHOR, AT THIS HOUR: Yes. Absolutely. Ryan, appreciated. It's good to see all of that help and aid arriving there. Thank you. Thanks to all of you for joining us today. I am Erica Hill. Stay tuned. Inside Politics with John King starts right now.

JOHN KING, CNN HOST, INSIDE POLITICS: Hello, and welcome to Inside Politics. I'm John King in Washington. Thank you for sharing another very busy news day with us. A bullet point list from Mar-a-Lago. A judge unsealing the FBI inventory of what federal investigators seized from Donald Trump's home. It includes dozens of empty folders marked classified.

Plus, job growth slows, but is more than solid. Add it all up. The humming American economy has added nearly 6 million jobs over the past year. And President Biden outlines his midterm choice, democracy and tolerance versus the president says letting Donald Trump and his allies smother the American experiment.

Up first for us this hour, a just released a damning list of the highly sensitive government documents, the FBI found in its search of Donald Trump's Mar-a-Lago. The seven-page inventory was unsealed this morning, short time ago by a federal judge. Along with a second government court filing that made very clear, very, very clear the depth of the former president's legal troubles.

The volume of paper we are talking about here is stunning. Take a look. 18 documents marked top secret, 54 documents marked secret, 31 documents marked confidential, four dozen empty folders. Yes, empty folders marked classified, 11,000 non classified government documents as well, intermixed with stuff, clothing, gifts, mementos, magazines, other press clippings. We now have a much clearer picture about the sheer number of things the FBI hauled away, but little more specific content about the specific content and the range of subject matters in those documents. But we did get this from the second newly released document. The Justice Department telling that judge, its review of the materials removed from Mar-a-Lago is part of a "active criminal investigation."

With me to share their reporting, expertise and insights, CNN's Sara Murray, our CNN legal analyst, Carrie Cordero, and CNN's Evan Perez who outside a courthouse here in Washington. Evan, Trump's lawyers have tried to play this down as a, this is a dispute over a late library book. If you look at this seven-page inventory and everything in it, it's like they took a wing of the library.

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: Yes, absolutely, John. And look, I mean, this judge in Florida is now involved in an investigation that already has two other judges that are overseeing parts of it, including the chief judge here, who issued and who signed the original subpoenas that went to Donald Trump and to try to get some of those documents that the National Archives has been trying to retrieve for more than a year.

As you've noted, some of these government documents, including sensitive classified information were intermingled with private, with personal items, which included clothing, press, and magazine clippings, dozens and dozens of pressing and magazine clippings. And in all, 11,000 government documents - non-classified government documents were found in that.

We also as you pointed out, found according to the FBI, they found 48 empty folders that were labeled as classified. We don't know what that signifies. We don't know whether those documents are missing, whether they were perhaps found in the pile that were found in different parts of Mar-a-Lago.

One of the interesting things that stood out to me, John, is the seven boxes that were found with classified information in the former president's office in Mar-a-Lago. You'll remember that in June, prosecutors and the FBI went to Mar-a-Lago. And one of the things that they all agreed with the Trump team was that, you know, classified information would be taken and stored in the storage room. This is where the rest of the material was found.

It is it's clear from the search that happened on August 8, that that was not done. And that is one of the reasons why, according to the documents that were unsealed today, prosecutors say that one of the things that they're examining as part of this criminal investigation is the manner in which these sensitive materials were being stored. John?

KING: Evan, stay with us to bring the conversation. So, Sara, 18 top secret documents, 54 secret documents, 31 confidential documents, people might say just stop there, but thousands and thousands of other government documents as well. The government makes the case, that's your property, my property, the American people's property, not Donald Trump's property. SARA MURRAY, CNN POLITICAL CORRESPONDENT: Right. More than 11,000 non- classified government documents. That's a lot of documents after more than a year of wrangling with the National Archives over this. You know, I don't think it's a great look for the former president that that's how many documents he still had sitting around after all of these efforts to get them back. But I do think what we will hear from the Trump team is look, if you look at the overall volume of these documents, the vast majority of what they took were not documents marked classified.

[12:05:00]

So essentially, that gets back to their notion that, you know, this was the fight over an overdue library book. These were just documents. We were in discussions about when to return them or they are, you know, the other argument that they've made essentially. These were the former president's documents that he didn't believe that he had to return them.

But I think we are going to hear them focus on that number as an indication that this is really, you know, not so much about the Espionage Act. We're not so worried about the classified markings is more just about these presidential records that should have been Trump's anyway.

KING: They will. They obviously have a very different views in the government. And we watch how it plays out in several different courts, because this involves, number one, the special master question here, but then also the active investigation. The Justice Department talks about what is your take on this as someone who understands the sensitivity of national security documents.

So, this inventory says filed under seal, this status report says filed under seal. This federal judge decided to take materials, even these cases are usually litigated highly private because of the sensitivity. This judge has said, here you go.

CARRIE CORDERO, CNN LEGAL NATIONAL SECURITY ANALYST: Yes. It's really interesting and it's very out of the norm. And the former president's request for the special master really, in my judgment is not on good grounding in terms of the arguments that he's making. But this judge is really going much farther, and now releasing more information about what was obtained during the search.

What's interesting about that is that usually, someone who is being investigated, or potentially being charged with crimes would not want this information out. Because with each new piece of information that gets released, we see more classified documents. We see more documents that even if they're not classified, are lawfully the property of the United States government.

And that's the key point here. These documents did not belong to the former president, they belong to the United States government. And so, the obstructive piece of this story becomes more and more apparent as we are learning what more documents where they are that they did not return, even after being asked repeatedly by the Justice Department. KING: Right. Your eyes go first to this, which the seven-page inventory because we don't normally get to see, you know, the fruits of a search warrant unless somebody comes to trial. You know, we're going to get to see especially when it has secret, top secret, classified, et cetera. But if you read this, I want your significance on this.

One of the questions when the search warrant was executed, did the Attorney General Merrick Garland just run out of patience and say, I want those documents back. Was that what the search was about? Just getting them away from Donald Trump and getting them back in government hands, but this status report says in it. It is important to note review of the seized materials is not a single investigative step, but an ongoing process in this active criminal investigation. What does that tell you?

CORDERO: Well, that was a question that I had when the search was executed, because a physical search could be executed at two different major stages of the investigation, one would be the final thing. In other words, the investigation has really run its course. And the physical search based on probable cause is like the final step that the government is going to take, and then they're going to make a decision whether to charge. That doesn't seem to be the case here.

In this case, the government seems to have a robust investigation, both on the mishandling of classified information and on obstruction, which involves not just the former president but people who attested to having returned that he had returned the documents, a wider range of individuals who handled these documents and potentially obstructed the government. So, this seems like a very live investigation that there is more runway left on.

KING: So, let's come back to the reporter Sara first, and to Evan. I want you to focus on the issue at hand. This filing was unsealed in the fight over a special master, which the government believes is a Trump stalling tactic. They want that - they're asking the judge to appoint a special master to go back and review everything that Justice Department did, review every document that was taken, so that they can then raise complaints. This is executive privilege. This is lawyer client privilege. This has just run out the clock in the view of the government. Where are we in that question?

MURRAY: Well, you know, look, the Trump team, what they wanted was a full stop. They wanted a special master to come in and be able to stop the Justice Department's review of the material and the national security risk assessment that's going on, and to look at all of the documents that had been seized from Mar-a-Lago.

What we heard from the judge was still this inclination to grant a special master. She was asking, you know, what is the harm in it, which would, you know, pause the Justice Department's ability potentially, to look at these materials.

She was not open to the idea of stopping the national security risk assessment. She indicated that she would have some kind of carve out that would allow that to continue. But, you know, we did see her again. Like I said, say what's the harm not really buy into the government's argument that this was unnecessary.

KING: Right. So that you just raised the third element, which is the national security agencies reviewing the potential harm of these documents, leaving secure government facilities and going to a hotel where the former president lives. Evan, come back in though, and again, we're talking here, these filings we get them public because of the special master dispute.

But this status report makes clear and reminds us, the more important piece of this, if you will, as the active criminal investigation about the mishandling of classified documents that could involve, could be, you know, the former president, could also be people around him. How these were handled? Why it took so long to get the back? What do we know about the status of that?

[12:10:00]

PEREZ: That's right. I mean, I think one of the things that's important to you notice they mentioned the fact that they're going to be talking to witnesses. And they want to talk to witnesses about not only the documents that were retrieved in the search, John, but they want to talk about the entire process. One of the things that stands out obviously is those empty folders. And one of the things that prosecutors are going to - investigators are going to want to do is talk to witnesses who saw how the president handled classified information.

But you know, to establish a pattern, right, that he keeps the pattern that we know was reported from when he was in office. When he left office, and he was kind of cavalier about how he handled these things, because that makes a big difference, right? When you are president, OK, you can - it's not great, but he is president, he's allowed to do that.

Once he was no longer president, you're not allowed to have classified documents sitting around your office, especially once you've been told that you need to keep it in the storage room, which is, you know, supposed to be a little more secure.

KING: Right. It'd be fascinating if we ever learned more about the substance of those - the folders not classified, they were empty or folders mark returned to military aid or staff secretary, they were empty, be fascinated whoever find out what specifically was or was supposed to be in those. Evan Perez, Sara Murray, Carrie Cordero, back with us a bit later. Up next, President Biden touts a very strong jobs report is proof his policies are working, but how the Fed interprets those numbers is now a giant question.

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[12:15:00]

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KING: New jobs numbers, today show hiring remains robust even with Federal Reserve interest hikes that are designed to cool the economy. Hiring did slow some. There were 315,000 new jobs added in August. That's down from a blockbuster 526,000 in July. So, a big question for the Fed. When it meets later this month, is whether it believes that things have cooled off enough or if another rate hike is warranted. For the president, another solid job showing is a gift and a chance to make the case, his policies are helping.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT UNITED STATES OF AMERICA: The great American jobs machine continues come back. America workers are back to work, earning more. The bottom line is jobs are up, wages are up, people are back to work. And we're seeing some signs that inflation may be, maybe I'm not over promising, may be beginning to ease. None of this is happening by accident. These investments, this recovery are direct result of my economic plan. Some people gave up on American manufacturing, not me.

(END VIDEO CLIP)

KING: With me to share their reporting and their insights, Cleve Wootson of The Washington Post, CNN's Kaitlan Collins, CNN's Eva McKend, and Amara Omeokwe of the Wall Street Journal. Let's start with you, Amara. Economic expertise to the president says, it's a robust number. It is, it is over 300,000 is still wow, normal economy 175, 200 you'd be happy. When he talks about, he sees some signs as one over promised that inflation is mitigating. Do you see that in the jobs report? Or is that the president's political wish?

AMARA OMEOKWE, ECONOMIC REPORTER, THE WALL STREET JOURNAL: Well, there are signs that inflation is slowing down. If you look at the last couple of inflation reports that we've seen, we did see a slowdown, but inflation is still very high over 8 percent, you know, the highest rate in about four decades. And what the Fed has said is that it is committed to seeing inflation come down.

Fed chair, Jerome Powell has said he wants to respond forcefully to what we're seeing an inflation. So, the president can say we're seeing positive signs, but the Fed is still committed to really working hard here to bring down inflation. And they've acknowledged that could cause some pain for the economy.

KING: So, before I bring the political group in great reporters, but you're the economics expert here. Let's show the jobs report. Let's show jobs add and you go back for August 2021, and you just see. When I first came to Washington, I covered this speech. That is wow. Any American president we're doing handstands. If you have month after month after month of job growth like that.

The question though becomes, how does the Fed read it? If the Fed interest rate hikes, which had been significant in recent months are meant to slow things down. Is that enough? Or is it inevitable that the fed will raise rates again? And if the answer is yes, a modest or another big one?

OMEOKWE: Well, the Fed is very likely to raise rates again. I think that they are considering how big that rate increase should be. They're looking at the jobs report. They're looking at incoming inflation data. But no one report is going to change what they have said they're committed to they're going to be looking at the totality of data. And there's they are saying that they're going to continue on this interest rate increasing path until they feel convinced that inflation has come down meaningfully, and then inflation entrenched.

KING: And here is a reason why as we move the conversation to a bit more of the politics, and the president tells sell the American people, look in the rearview mirror, I know it's been tough, but things are about to get better. Here's the wages versus inflation. Again, most presidents would be thrilled. If you look at the bottom line there, that's wage growth. Wages are going up. You see it's a flattened out a little bit now.

But overall, if you look at the overall trajectory in the past year, it's a pretty good number. But that green line on top is inflation. So, people are getting bigger paychecks. But it's not enough to offset, what was rising gas prices are on the way down now, but food, energy et cetera.

KAITLAN COLLINS, CNN CHIEF WHITE HOUSE CORRESPONDENT: Yes. And that's been the criticism of the White House, when they tout those other numbers and they talk about the wage increases, they talk about what's erased by inflation and how people aren't feeling it. And that's why you've seen these poll numbers so low for, not just the White House, but for the economic outlook generally, is that people aren't feeling those really good jobs numbers all the time.

And so, that's something that the White House has to kind of reconcile here is pushing the messaging, pushing the highlights of the numbers, but also recognizing how people feel. I thought it was really notable that President Biden was so cautious and saying inflation may be beginning to moderate.

He really went out of his way to say maybe, because remember, it was in December when he said, he thought we had hit the peak of the inflation crisis. Of course, the Ukraine invasion did happen since then. But it is notable, they want to have a tone of caution.

KING: Right. And it was last year, he said it was transitory. So, he has learned his lesson that appears on that one. A statistic, I look at all the time obsessed about covering campaigns as the Michigan consumer sentiment index. I want to put that up on the screen right here. It is historically low. That's a bad number. But I always focus on trajectories, the trajectory is going in a better direction. The president's approval numbers going in a better direction. That he needs the psychology of things are better, now things are worse when people vote.

[12:20:00]

CLEVE WOOTSON, WHITE HOUSE REPORTER, THE WASHINGTON POST: Yes, exactly. And I think that here in Washington, we're going to debate the minutia. We're going to debate what it means with regards to inflation. But you saw Biden said just a few minutes ago when he spoke, he is saying, you know, jobs are up, wages are up, like things were bad when we started. You gave us power. You gave us control and now things are better. And that's a very clear succinct message that he's going to hammer. We're going to be able to say all this stuff he's saying ad nauseam in 10 weeks we'll hear it.

KING: You spent a ton of time with candidates and campaigns. Are the candidates or Democratic candidates in a place now where they're willing to be more optimistic about the economy? Through most of the summer was, I want to help you with inflation. I know you need my help, I'm here. Are they willing to be more? That would tell you, if the Democrats start talking up the economy more.

EVA MCKEND, CNN NATIONAL POLITICAL REPORTER: And they've emphasized that you can see it in the campaign ads. They've tried to distance themselves from this president when they talk about the economy. But I think that the president is probably striking the right balance here by being cautiously optimistic. And I think it's a message that will work with his supporters. Now, those who already feel negative about the economy on the center right, I think no matter what they do, they are never going to convince some of those folks.

KING: That's the political debate about the economic numbers. As we go forward, two more of these before the midterm elections, two more monthly employment or unemployment, reports depending on your perspective. Up next for us. President Biden's midterm message takes shape. His first point, protect democracy.

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[12:25:00]

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KING: President Biden making a stark midterm pivot last night, trying to turn the campaign from the choice about his presidency to a choice as he puts it about democracy survival. The president's view as he outlined in Philadelphia, democracy is no longer guarantee that too many Republicans are no longer normal, and that he can no longer avoid naming and blaming his predecessor for this rot.

(BEGIN VIDEO CLIP)

PRES. BIDEN: Donald Trump and the MAGA Republicans representative extremism that threatens the very foundations of our republic. There is no question that the Republican party today is dominated, driven and intimidated by Donald Trump and the MAGA Republicans. And that is a threat to this country.

(END VIDEO CLIP)

KING: New Yorker staff writer and Biden biographer, Evan Osnos, joins our conversation. Evan, I saw you last night say, you think this is a speech, he's wanted to give her some time. And yet, and yet that does contradict somewhat his stated desire to go back to have Senator Joe Biden be President Biden and have no more bipartisanship, more camaraderie. Now, he thinks not going to happen?

EVAN OSNOS, STAFF WRITER, THE NEW YORKER: Though I think this is the moment when he says, unity has limits. It's not unanimity. And what he's saying, in effect is, if there are Americans who want to take themselves out of the realm of legitimate politics by talking about violence, that word came up over and over again last night. That was in some ways, I think, the anchor at the center of the message who was trying to get across. He says those people are putting themselves out of the realm of people who get to participate in politics.

And look, this is part of a long tradition. In fact, if you go back, there has been this larger competition than just about votes. It's about reason versus force in American politics. Lincoln talked about the idea that you could have cold unimpassioned reason. And that's the idea that Biden is trying to make a case for. He says, it's not Democrats or Republicans, it's about reason over force.

KING: And let's listen to a little bit more what the president said last night. He likes this term. But he was quite adamant, that he sees this is an inflection point. And that if Americans essentially don't defy history, history says the Democratic party loses in a midterm election. The president United States say says, rethink that because of the risks.

(BEGIN VIDEO CLIP)

PRES. BIDEN: I believe America is at an inflection point. One of those moments that determine the shape of everything that's to come after. And now, America must choose to move forward, or to move backwards, to build a future or obsess about the past. To be a nation of hope and unity and optimism, or a nation of fear, division, and of darkness. MAGA Republicans have made their choice. They embrace anger. They thrive on chaos. They live not in the light of truth, but in the shadow of lies.

(END VIDEO CLIP)

KING: Now, president was passionate there. Republicans, especially Trump allies make the case. He is insulting Trump voters that this is deplorable all over again from Hillary Clinton. How does the president and his team walked that line?

COLLINS: It's a tough line for them to walk. And he keeps using the phrase MAGA Republicans, that's something they spent weeks crafting, poll testing that term to see how effective it was with voters, more effective than using the word Trump since he's not on the ballot this November.

And so, they are drawing that line because Republicans after watching a speech like that, quickly come out and say, he's talking about all 74 million Trump voters out there when he makes those comments. He actually was just asked about this and asked if he sees Trump voters as a threat to the country and a threat to democracy.

And the president just told reporters, I don't consider any Trump supporter a threat to the country. But he said and this is where he drew the distinction, John, I do think anyone who calls for the use of violence and fails to condemn violence when it's used, refuses to acknowledge when the election has been won and insist upon changing the way you count vote. That's a threat to democracy.

So, that's the line that he's drawing there. And there are obviously Republicans who think that election was won fair and square. There are a lot of Republicans who believe that it was stolen, and you see that in polling.

KING: Right. And that was another point the president is trying to somewhat - I was talking about during the January 6 here, and Liz Cheney seems to try to shake Republicans, Trump Republicans out of their spell. The President Biden seems to be doing the same thing because it's just a fact. If you look at election deniers running for office as Republicans is often in many states, just for secretary of state, the people who count the votes. The president trying to address that last night, saying that you cannot support a party that does not support basic math, counting votes.