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FBI Searching Biden's Rehoboth Beach Home In Documents Probe; Biden Lawyer: FBI Has Our "Full Support And Cooperation"; FBI Has Searched Penn Biden Center, Wilmington & Rehoboth Homes; CNN: Top Trump Org Executive To Appear Before Manhattan Grand Jury Tomorrow; Pres Biden And Speaker McCarthy Meeting Today; House Republicans: Biden Must Negotiate To Raise Debt Limit; Biden Suggest McCarthy Operating From Position Of Weakness; Source: Nikki Haley To Run For President. Aired 12-12:30p ET

Aired February 01, 2023 - 12:00   ET

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

[12:00:00]

JOHN KING, CNN HOST: Hello, and welcome to Inside Politics. I'm John King in Washington. Thank you for sharing a very busy breaking news day with us. The FBI searching President Joe Biden's Rehoboth, Delaware home. Right now, his attorney says, it's all planned. This as the special counsel investigating how classified documents ended up where they don't belong, marks his first day on the job.

Plus, the speaker summit. Today, Kevin McCarthy finally sits down with Joe Biden at the White House for the first time as House speaker. Expectations are low, but the stakes including for you are quite high. And Nikki Haley is ready to take the 2024 plunge. CNN has learned a formal presidential campaign announcement is coming. She would be just the second Republican to declare others timid because Donald Trump went first, and we all know he's never kind to competition.

We begin the hour though, with a remarkable legal event happening right now. The FBI is searching President Biden's vacation home in Rehoboth Beach, Delaware. The president's attorney plays down the significant saying, Mr. Biden greenlighted the search and that everything was cooperatively planned in advance. Still, FBI agents at the home of a sitting president is hardly routine.

It is the third property frequented by the president, where federal agents have looked to see if there are classified materials. CNN's MJ Lee standing by for us live at the White House. Let's begin with CNN's Jessica Schneider. Jess, what do we know?

JESSICA SCHNEIDER, CNN JUSTICE CORRESPONDENT: Well, John, this is actually a third search that we've been anticipating here. That's exactly why reporters and photographers have been sticking out President Biden's Rehoboth Beach home. And in fact, just before 8:30 this morning, two black SUVs, two sedans arrived at that beach home. And it was later confirmed that this is in fact an ongoing FBI search.

We're going on now, about four hours. And notably, this is all happening on the same day that Robert Hur is officially starting in his special counsel role. That's according to reporting from our Paula Reid. Her, of course will be overseeing the investigation of President Biden's handling of classified documents.

So, backing up here, our team has learned that so far up to this point, dozens of classified documents have in fact been found as a result of the several searches over the past few months, that incorporates what Biden's attorneys previously found in November and December from the Penn Biden Center and Wilmington.

And then also what was taken from Biden's Wilmington home just about two weeks ago, during what was a 13-hour FBI search. The documents that were found in that search have really only been described by Biden's personal attorney. Up to this point, as six items consisting of classified information, not exactly sure the number or what it entails.

So, John, we'll wait and see here what exactly is found today. This could be another lengthy search here. President Biden's team is promising an update when it's over. But we'll see if potentially this further deepens the ongoing special counsel investigation here, John?

KING: Jessica Schneider, thanks for that important reporting. To kick us off, let's go now live to the White House, MJ Lee standing by for us. MJ, the president's attorney saying we planned this in advance, we're cooperating, still a big deal.

MJ LEE, CNN SENIOR WHITE HOUSE CORRESPONDENT: That's right. And if we could start by putting up a part of the statement that we just got from Bob Bauer, the president's personal lawyer. He said today with the president's full support and cooperation, the DOJ is conducting a planned search of his home in Rehoboth, Delaware. Under DOJ standard procedures and in the interest of operational security and integrity, it sought to do its work without advanced public notice, and we agreed to cooperate.

Now, this is obviously a carefully and deliberately crafted statement where the White House again is wanting to emphasize that they are fully cooperating with the DOJ's ongoing investigation. And this, of course, is a part of the bigger strategy to of the White House wanting to emphasize that how they have been handling this issue is very different, for example, from how President Trump and his team has been handling this issue as well.

And at the end of the day, they are ultimately hoping that what the investigation will show is that some of these misplaced classified documents that they were misplaced inadvertently. Now, Biden's lawyers have previously searched this Rehoboth home that is worth noting here. And they said that they didn't come across any classified materials during that search.

So, we will definitely have to see whether the FBI agents conducting the search makes the same conclusion. But I don't have to tell you, John, that obviously politically speaking, this has been a big headache and a distraction for the White House. And they are trying to turn the page on this. But what they don't know of course, is how many more searches could potentially come in. And if there will be more classified documents that do turn up in the future. John?

[12:05:00]

KING: MJ Lee at the White House. Jessica Schneider, appreciate you kicking us off. Come back if we get any new information soon as the search unfolds. With me now our CNN senior legal analyst Elie Honig. He's also the author of a brand-new book, "Untouchable: How Powerful People Get Away with It." Elie, thank you for being here.

So, the White House wants to say, and you get it, you know, we're cooperating, this was planned. This is not like Mar-a-Lago. They don't say this, but they implicitly this is not like Mar-a-Lago. Nobody needed a search warrant here. Their hope has to be that this is - the optics of this are bad that this gets over with as quickly as possible.

ELIE HONIG, CNN SENIOR LEGAL ANALYST: I think that's exactly the strategy here, John. There's bad news and there's good news for the White House. The bad news is the FBI and the Justice Department have clearly decided, we need to be involved in this search. And no, we do not trust you or we are not willing to let you Joe Biden in your team, do this search and just report back to us. We need to be involved. We need to have our people inside the home as we are seeing now.

The good news and this is what the attorney Bob Bauer statement is stressing is this is not a search warrant. This is not DOJ having to go to a judge, establish probable cause of a crime which you have to do to get a search warrant and then kicking in the door. Not that they did that at Mar-a-Lago, but the search warrant process is what happened at Mar-a-Lago. So, this is what we call a consent search, meaning that Joe Biden's team has agreed to this.

KING: So, how much of that, we talked about the optics not being good politically for the White House, they hope this just passes as quickly as possible. How much of that, put yourself back in Justice Department, federal prosecutor, how much of that is politics for the Justice Department? In that, you know, that we can't say we just trust you Joe Biden, to tell us they're all returned. We need to check because we have the Trump issue separately. And if we treat you differently, we'll be hammered.

HONIG: I think there are two rationales here behind DOJ's approach. One is maybe they just don't trust the Biden team. Not necessarily that the lie, but just better if we do. But the other thing, I do think DOJ and FBI are aware of the optics, the public appearance, that there's going to be questions. FBI, why would you just trust them? Why wouldn't you at least send your people in with their consent? So, I think DOJ is trying to thread that needle there, John?

KING: Elie, standby because we want to bring you now another story. Just into CNN, a very top Trump organization executive expected to appear tomorrow before the Manhattan grand jury now investigating the former president's role in a hush money payment scheme.

Let's get the latest from CNN's Kara Scannell. She joins us live. Kara, what do we know?

KARA SCANNELL, CNN CORRESPONDENT: Well, John, sources tell me that the Trump organization's comptroller Jeff McConney. He's one of the top financial officers at the company is scheduled to appear before the grand jury in Manhattan tomorrow. This grand jury, as you said, is investigating the Trump organization and the former president's alleged roles in the hush money payments scheme that they paid $130,000 to Stormy Daniels to silence her allegations of a prior affair with Trump just before the 2016 election.

Trump has denied the affair and said that he was unaware of these payments. But this is another sign of the escalation - the acceleration of this investigation. As we previously reported, the publisher of the National Enquirer David Pecker was in meeting with prosecutors this week.

Michael Cohen Trump's former personal attorney who pleaded guilty to federal campaign finance charges in connection with the scheme has met with prosecutors just two weeks ago. And he told CNN this morning that he gave them his phone because they wanted voice recordings that he had made with Stormy Daniels' attorney Keith Davidson.

So, just another signal that this investigation is moving at a quick pace. And McConney is interesting because he was in-charge of the books and records of the Trump organization. And the key thing that that investigators are looking into is whether the Trump organization had falsified any business records. John?

KING: And Kara, help people at home who might be asking why now in the sense that this investigation, there are current real time investigations of Donald Trump or 2020 election investigations of Donald Trump. This one goes back to events that happened before the 2016 presidential campaign. Why the new, more urgent or accelerated focus?

SCANNELL: Well, it's still hard remember that this investigation has been going on since 2019. It started under the previous district attorney. Their focus had expanded looking into the accuracy of the Trump organization's business records. And then when there was a change in leadership last year with a new D.A coming in Alvin Bragg. He wasn't so hot on that case.

And the allegations or the evidence that the prosecution team had put together. So, he wasn't willing to move forward with any charges against the former president in connection with the business records. And we didn't see the New York attorney general's office bring a civil case related to that same conduct. But over the past year, the as these prosecutors are continuing to needle away at this issue. They have returned to the focus of hush money payments and are exploring whether they have more evidence, a new legal theory or some other way that they're looking to approach this now. John?

KING: Kara Scannell, grateful for the important reporting. Appreciate it very much. Let's come back into the room to talk with Elie Honig. Elie, in your book you talk about the whole Stormy Daniels saga and this investigation.

Now, Michael Cohen turns over his phone that could be important evidence but forgive me, Michael Cohen is not always a straight shooter. He has his own history in the past. So, if you're looking for credible witnesses, now you're bringing in the bookkeeper. The guy who dots the I's and crosses the T's who knows where the money goes, what's the significance?

[12:10:00]

HONIG: Here's what's so interesting, John. The Manhattan D.A which is a state level prosecutor is essentially recreating the investigation that the feds, the Southern District of New York, my former office did three years ago, which I get into in this book. I give the inside story of what the Feds did. And as to the two people you just mentioned, Michael Cohen the Southern District of New York, the Justice Department did not find Michael Cohen credible.

They put that in their sentencing memo to the judge. They said, while gave us some information, he was not fully forthcoming. They rejected him. Now is the D.A going to look at Michael Cohen a few years later and reach a different conclusion? Could there be risk in that? As to this new individual, Jeffrey McConney, brand new reporting. I spoke to several people who were involved with him at DOJ. There were mixed reviews.

Let's just say I'm Jeffrey McConney. Some of the people felt that he was more or less truthful. He's a very important person, as Kara said, essentially the number two, financial person that Trump won, but others at the southern district of New York had real questions about whether he was being fully truthful with them. So again, these aren't sterling witnesses that the D.A is bringing in. These are witnesses who have had problems when the Feds brought them in, in the past as I sort of lay out in detail on that book,

KING: Worth reading the book just for that reason, and we'll watch to our great reporters like Kara to bring us the latest, so the investigation Elie Honig. Thank you. Up next for us. A big meeting and agenda item at the White House today. The president, the speaker and paying the country's credit card bill.

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[12:15:00]

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KING: A big meeting today between President Biden and the new Republican House Speaker Kevin McCarthy. Topic one, this afternoon is the need to raise the government's borrowing limit. A debate that will shape the tone and the trust levels of the next two years of divided government.

The White House says raising the debt ceiling is a shared responsibility and should stand alone. Any discussions about federal spending the White House argues should be separate, come later and be part of the normal budget process. Speaker McCarthy though just today says, that's irresponsible.

(BEGIN VIDEO CLIP) REP. KEVIN MCCARTHY (R-CA): But I'm not here to play political games. We've got five months to deal with the debt ceiling, I think an adult way in a very responsible way to sit down sensibly and work together. I have a lot of ideas that I'll sit down with the president.

(END VIDEO CLIP)

KING: CNN chief congressional correspondent Manu Raju, live for us up on Capitol Hill. Manu, A, do we know what any of those ideas are? The speaker says, he has a lot. And B, the divide here is pretty significant.

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Yes. It is a significant standoff and one that we have not seen to this extent since 2011, when there was a downgrading of the U.S. debt of the credit of the United States as the debt default loom. They have waited a debt default, that has never happened in the U.S. history. But it's uncertain how this fight will end up. They have up until probably about June, maybe earlier, maybe a little bit later to raise the national debt ceiling.

And right now, Republicans data have not laid out specifics that they want in terms of spending cuts, but they are united over the process, or moderates and conservatives. All telling me this morning and emerging from a closed-door meeting that it is incumbent upon the White House to negotiate with Kevin McCarthy. And even some moderate say, they will not support raising the debt ceiling without any conditions, if the White House doesn't come to the table.

(BEGIN VIDEO CLIP)

REP. MARJORIE TAYLOR GREENE (R-GA): If the White House refuses to negotiate, then the president of the United States will be telling the American people that he doesn't know how to lead this country. And he doesn't know how to get our fiscal house in order.

REP. BYRON DONALDS (R-FL): Every banker, every financier, every investment group, every small business owner, every large business owner should be looking at this White House is saying, what do you mean you're not going to negotiate?

REP. DON BACON (R-NE): The president needs to negotiate. We all feel that way. And I think we just got to find a middle ground. And I think once we find a middle ground, we would be willing to vote yes. (Ph)

(END VIDEO CLIP)

RAJU: And that last congressman is Congressman Don bacon. He represents a swing district from Nebraska. Someone that Democrats hope they can defect from the Republican leadership, but as you heard right there, his agrees with Kevin McCarthy stance on this. But John, it will get much more difficult when they have to lay out specifics in terms of spending cuts, Republicans not on the same page on this issue. And McCarthy behind closed doors today, John, did not lay out exactly what he wants other than trying to press the White House to engage. John? KING: Manu Raju, life for on the Hill. This is the beginning of the process, but an important day nonetheless, Manu, thank you. With me in studio to share their reporting and their insights Tia Mitchell, the Atlanta Journal-Constitution, Laura Barron-Lopez of the PBS NewsHour, and CNN's Jeff Zeleny.

It is the beginning, but it's an important beginning. The details will be pushed down the road a little bit. But these two men don't have a real relationship they've met several times. This is the first time they'll sit down with the president and the speaker, Speaker McCarthy.

Can he hold to his position? He says he has a lot of ideas. The president is going to say, what are they? Lay them out, what would you cut?

TIA MITCHELL, WASHINGTON CORRESPONDENT, ATLANTA JOURNAL-CONSTITUTION: That's where the rubber meets the road? Yes, it's good for the speaker of the House to meet with the president of the United States. I think this is an important meeting, regardless of the issue at hand. But when you drill down on the issue at hand, it's the onus is on Republicans. They're the ones that want to couple the debt ceiling with the budget. So therefore, they're the ones who have to provide the parameters of how to move ahead, and they haven't thus far.

LAURA BARRON-LOPEZ, CNN POLITICAL ANALYST: They haven't provided any details for months, right? Because even before they took full power at the beginning of January, they were saying that they wanted to potentially tie the debt ceiling increase to spending cuts.

And at time some Republicans said, cuts to social security, cuts to Medicare, which speaker McCarthy has subsequently said that he doesn't necessarily want to touch those now, because that would be very unpopular, but they haven't provided any details. And that's what the White House is really hitting them on right now, because they think that that gives them a good argument with the public.

KING: To that point, Jeff, when President Biden served in the Senate, this was a pretty routine debate. It was a bipartisan thing. These are past due credit card bills, Democratic presidents, Republican presidents, democratic Congresses, Republican Congresses to pass do bill, we all have to come together raise the debt ceiling, then we'll fight over here about other stuff.

That's what the White House says. This got different though, when he was vice president. The Obama years has got contentious. Now, you have this new majority. The president's Communication Director this morning says, the president's going to look the Speaker in the eye and say, sorry, debt ceiling first, then maybe we'll talk

[12:20:00]

(BEGIN VIDEO CLIP)

KATE BEDINGFIELD, WHITE HOUSE COMMUNICATIONS DIRECTOR: He voted for a debt ceiling increase with no preconditions, three separate times under President Trump. The president is not going to negotiate over Congress's constitutional responsibility. He's going to call on Speaker McCarthy to put his budget on the table to be transparent with the American people.

(END VIDEO CLIP)

KING: Both sides say, they're going to stand firm. The Republicans say, you got to negotiate, the White House says, no don't.

JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: And that's exactly what they'll be saying after this meeting, as well. Look, as you said, this is the beginning of the process. But the White House believes that one of their biggest strengths here, if you will, is the fact that Republicans are not united around the idea of what they want to cut.

So that, yes, the speaker is going forward here at this meeting, but he doesn't necessarily know what his members want and can get behind. It's many of the same as similarities are happening now versus those meetings with President Obama, Vice President Biden, Speaker Boehner, etc. But one difference, the Tea Party movement, which was all about spending was really driving the party then.

This Republican Party is driven by many different things, cultural issues, other things. So spending is not necessarily coming on the heels of the Trump administration where there was a free spending, let's admit it, spending is not necessarily the driving force of this party here. So that is what's different from the debate some 12 years ago.

KING: And it's also, it's interesting, because the debt ceiling is a big deal but this relationship a bigger deal, if you will, if there's a if there's some national crisis or something down the road, that the president has to deal with the Republican speaker.

This is what the president said yesterday, of the speaker, a decent man, I think, McCarthy, look at what he had to do. He had to make commitments that are just absolutely off the wall for a speaker of the House to make in terms of being able to become the leader.

So, this is - the debt ceiling is a big issue. Spending is a big issue. But this is also a feeling out. Can we trust each other in private when push comes to shove in town?

MITCHELL: And I think that is what makes Kevin McCarthy speakership unique is because it's not just is he a good person? Can he negotiate? But what are his members doing that may tie his hands that may prevent him from going too far with Democrats, from going too far in lockstep with the White House and that is going to prevent him perhaps from doing things that maybe another speaker would be more open to.

And again, we don't know what those parameters are? Almost it seems like every week, we're hearing about new things that the far-right members of the House say that speaker McCarthy has promised to them. And those are just more things that will shackle his ability to work with the White House. BARRON-LOPEZ: And unlike President Biden's relationship with Senate Minority Leader Mitch McConnell, he's had a long relationship with McConnell. He wants to keep that up that very bipartisan atmosphere with McConnell. With Speaker McCarthy, we're seeing where the president, especially in this lead up to a 2024 reelection announcement is trying to use the extremes of the House Republicans.

And the fact that now the Freedom Caucus has really taken over and is wielding, you know, power with the speakership in a way that they haven't ever before. The President Biden is trying to use that on the campaign trail, is trying to, you know, say that this is the Republican Party that I am adamantly against this new MAGA Republican Party.

ZELENY: Both are using each other as foils, or the reality is it's probably pretty a short relationship. And the president is not going to invest a lot of time in a long relationship. Who knows how long the speaker will be there?

KING: Senate Republicans are holding back for now. They're like, let's see, can you do as Mr. Speaker go for it, but we'll see how that goes over the next several months as well. Up next for us. Nikki Haley wants to be your next president. Not long ago. She said she would not run in 2024 if Donald Trump did, but he's already in the race. And Haley is about to join the Republican field.

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[12:25:00]

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KING: Nikki Haley is reversing course and preparing to challenge Donald Trump for the 2024 Republican presidential nomination. The former South Carolina governor and Ambassador to the United Nations plans a formal announcement in two weeks. Now this is a risk.

Trump is already a declared candidate. And despite a sluggish start, he remains a formidable force. But team Haley says, this was a warm- up, and that she is eager to make the case the Republican Party needs a new leader.

(BEGIN VIDEO CLIP)

NIKKI HALEY, FORMER U.S. AMBASSADOR TO UNITED NATIONS: When you're looking at a run for president, you look at two things. You first look at, does the current situation push for new leadership? The second question is, am I that person that could be that new leader? Yes, we need to go in a new direction. And can I be that leader? Yes. I think it's time for new generational change. I don't think you need to be 80 years old to go be a leader in D.C.

(END VIDEO CLIP)

KING: Our great reporters back at the table. It's a generational argument. It's a not Donald Trump argument. The question is now she is the second. So, she's the only other opponent today and we know what Donald Trump tries to do to the competition.

ZELENY: He does. We've seen, you know, chapter and verse of it back in 2015. I think what's different about it is now, is that, you know, she has also seen that movie and there is a sense among Republicans. No matter where you go, even fans of Donald Trump, people are looking for something new.

So, I think how she threads that needle by not necessarily criticizing him, which she did pretty skillfully in that interview. We'll see what her speeches coming up, but I think that she's going to make this generational argument. She also has a very strong support level among evangelicals.

And she will be yes, talking about her time as U.N. Ambassador but also as a governor, and she brought to business into South Carolina. So, I think she does represent a lot of different points of the Republican campaign argument if you will.

[12:30:00]