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McCarthy Reveals Santos Is Facing House Ethics Probe; Tonight: Biden Delivers Address To Skeptical Country; Poll: 6-In-10 Americans Says Biden Has Accomplished Little In Office; Sources: Labor Secretary Walsh To Leave Biden Admin; Gov. Sanders To Deliver GOP Response To State Of The Union. Aired 12:30-1p ET

Aired February 07, 2023 - 12:30   ET



JOHN KING, CNN HOST: We know that the FEC and regulatory agencies are looking at his campaign. We know the Justice Department has an investigation of some of his -- but George Santos says, for State of the Union tonight, all is good.

MELANIE ZANONA, CNN CAPITOL HILL REPORTER: Yes. So George Santos, we know he's under investigation now by the House Ethics Committee. He's facing his litany of investigations. He has been really trying to push back in a way that we haven't seen before. And he's been really defiant in face of these calls to resign.

But for Kevin McCarthy, the strategy here is to just keep distance. They can really hide behind the fact that there is an investigation on the House Ethics Committee, at the federal and local state levels. And they can say, let's just let those play out before we have to make a decision. But there will be a time when the House Ethics Committee makes some sort of a determination.

There could be an indictment that comes down and then House GOP leadership will have to make a decision about how they're going to handle this member. If they do push them out of Congress, there's going to be a special election, they could lose that seat. But for now, they're just hoping that this all goes away.

KING: And one of the questions or several of the questions revolve around campaign finances. A great CNN story today by our team, Santos unusual $199.99 campaign expenses are putting scrutiny on his longtime treasurer. The reporting shows that this treasurer also at one point worked for Lee Zeldin, former congressman ran for governor in New York.

And the same thing, you have to detail anything above $200. So if it's $199.99 raises some skepticism there. But listen to George Santos, he says, well, I'm the congressman. That's my campaign.


REP. GEORGE SANTOS (R), NEW YORK: I'm not a campaign treasurer. I couldn't answer that for you. I -- UNIDENTIFIED FEMALE: So you're saying you --

SANTOS: Like I said, I don't do my own treasury. Never did.


KING: Forgive me, but that's a cop out. I don't do my own treasury. Never did. The candidate is the CEO of the campaign. Like it or not, you got to pay attention.

CLEVE WOOTSON, WHITE HOUSE REPORTER, THE WASHINGTON POST: Yes, sure. And there seems to be no question that this kind of conveyor belt of accusations and stuff is going to keep coming. But the question is whether -- we know how it impacts Santos -- the question is whether it will continue to erode trust and other Republicans and McCarthy.

I think McCarthy's statement is if ethics finds something, you know, we'll take action. But like, do the American people really have confidence that with these paper-thin majorities in the House, that they actually will, you know, will take action and expel them?

KING: Yes. What does it do to the Republican brand if they continue to defend the guy and say he gets to be on committees, he gets to do all these things. He's asked voluntarily to step down from committees because the Speaker finally realized it was become an embarrassment. But I've been doing this a long time. Do you ever remember a freshman member of Congress who has consumed so much oxygen?

MJ LEE, CNN SENIOR WHITE HOUSE CORRESPONDENT: No. And we are just in this incredible, remarkable new cycle where every day, there does seem to be some new story, some new lie, some new fabrication, some peculiar --


LEE: -- you know, narrative from his past. But I do think what's remarkable -- Mel, you should correct me if I'm wrong, but it does seem like even, you know, compared to a couple of weeks ago, when we didn't know all of the information we know now, I mean, he's kind of in the same place, right, when it comes to the big question of whether he is close to being expelled from Congress, like we are waiting for the House Ethics Committee to now do this investigation.

As you said, McCarthy is basically deferring to that committee. But at this moment in time, even under the, you know, the pressure that he is facing, even given all of that, he's not really close to being expelled from Congress.

ZANONA: No, I do think it's interesting, though, that some of these other House Republicans from New York in his freshman class, have gone out of their way to call for him to resign. I mean, to your point, Cleve, this is them, recognizing that this could be a huge problem for them. Whatever happens to Santos --

KING: Right.

ZANONA: -- this could call fall back on them. And so they're trying to create that distance.

KING: Even McCarthy seems to be inching there. He needs the vote. But even he seems to slowly be coming to the realization, this dance is not going to last all that long.

When we come back, President Biden and you. The President's approval ratings heading into his big night, the State of the Union address. We'll take you inside the numbers in just a minute.



KING: Big night for the President tonight, the annual State of the Union address. Part of the President's challenge is to try to convince you politely that maybe he's doing a better job than you think. By that, I mean, this. If you look at the President's approval rating right now, it is at 41 percent. Yes, that's up a little bit from 38 percent. That's where he was last year for State of the Union address.

But the President ramping up for reelection run, would like to boost his approval rating some. So let's walk back through the arc of the Biden presidency. His first year, it's not technically a State of the Union address but a big speech to Congress from the newly elected President.

Unemployment rate, 5.3 percent. Inflation was starting to become an issue in the American economy and we were in a horrible COVID winter more than 142,000 peak. That was the hospitalizations there.

So let's move forward to 2022. The unemployment rate coming down. The President will talk about that. He wants to convince you the economy is doing better than you think. But inflation is still nagging 6.5 percent last year, and again a horrific COVID winter hospitalizations up above 160,000 at the peak.

So where are we now as the President comes in to his third year in office. The unemployment rate, a 50-year low. You'll hear about that tonight. We'll see. But inflation does seem to be easing some. We'll see what that number ends up at the end of the year. And yes, COVID is still with us. But the strain on the American hospital system and healthcare system much more mild than it was the past two winters.

So as the President looks forward, he wants to look back. You're going to hear a lot about all this tonight. The American Rescue Plan, the infrastructure plan, violence against women, gun safety, science and chips, judicial appointments to the bench. The President will talk about his record looking backwards.

He'll also highlight several of these, were bipartisan pieces of legislation. Part of the new dynamic tonight with the Republican House. The President's going to say the odds are high against this. We can get some things done.

[12:40:09] And so here's the big difference. When the President spoke a year ago, because Democrats had the majority, it was Nancy Pelosi, behind him as speaker. Tonight, Republicans have the majority for the first time in the Biden presidency, it will be Kevin McCarthy behind the President of the United States.

So let's start our conversation with this dynamic. Joining us now is the Republican pollster, Kristen Soltis Anderson. And Kristen, how does the President deal with this new reality in Washington, and how did the Republicans deal with him?

KRISTEN SOLTIS ANDERSON, CNN POLITICAL COMMENTATOR: Well, in his tonight's speech, he's going to be looking back, but he's also got to be thinking forward. He's going to be thinking about the fact that you've got things like the debt limit that are going to be coming up. There's still two years left in his presidency, presumably he'd like to do something with them.

But Republicans don't feel like they have a ton of incentive to have to do a lot of working with him. Even though the midterms were underwhelming for Republicans, the GOP base is not in love with Joe Biden. They've got a primary of their own, that's going to be happening on the Republican side.

So what Joe Biden, I think needs to do with tonight's speech is make the case to Republicans, look, you're going to want some sort of responsible spending things in order to happen in order to raise the debt limit. Here's what I'm willing to do, and begin to try to ratchet up that pressure on Republicans, or else you're going to see some big gridlock as we head toward the summer.

KING: If you're a Democrat or Republican, any president, any prominent politician has a healthy ego, and a lot of confidence, that's part of being successful in politics. So this takes you off. The approval rating on the economy, only 37 percent approve of the President's job performance. Does he have the leadership, 68 percent there, lack confidence in his leadership, 62 percent think he's had accomplished little in his time in office. How do you convince people, please change your mind, but be polite about it. You can't tell people you're wrong.

ANDERSON: That's right. You can't tell somebody, hey, you feel like the economy's not good. But I'm telling you, I promise, don't believe the price of the eggs at the grocery store, whatever it is, that's making people feel very frustrated. It's tough whenever you are a politician who believes you're not getting enough credit for things, and you want to persuade the American people that you deserve more.

I think the challenge he's going to have is you don't want to walk in and be Pollyannaish. Everything's fine. Everything's wonderful. And I did it. Because in some ways, Americans are saying, I don't think things are so good. And I really think if they're better, I'm not interested in giving you credit.

You can take something like COVID, for instance. I have no doubt that the President is going to want to say, look, we got through the worst of this pandemic. And he's going to want to say we've defeated it. And frankly, underline, I've defeated him as President.

But for many Americans, they're going to go great. I'm not giving you credit for that. That's table stakes. That's the minimum that I was expecting. I'm expecting an economy that kind of works, OK, the ability to afford my groceries. I don't want to give you a ton of bonus points for giving me what I think ought to be a basic just way of life functioning in America.

KING: I know you're Republican, but if you're advising the President, how do you handle this question? Even some of his friends, allies, watching him gear up for reelection, say, are you sure, sir? Are you sure because of your rates?

Michelle Goldberg, in the New York Times today, Biden's a great President, he should not run again. She believes he's just too old for the job. David Axelrod, who worked with him in the Obama White House when he was vice president, "If I were still a practicing political strategist and had the president's record, I think you could easily reelect him. But the question has never been political. It's actuarial. This isn't about his performance. It's really about age."

How important is the speech tonight, when you have the largest audience, the President gets in any year to convince the American people, I'm good at my job, and I can do it for six more years?

ANDERSON: Well, the first line of folks that he needs to convince are folks within his own party. And, of course, if he is the incumbent President decides he wants to run again, I don't imagine he'd face a strong primary challenger barring something extraordinary happening.

But right now, when I go out and do focus groups of voters, swing voters, and I mentioned to them, well, what would you think if you had a rematch between Donald Trump and Joe Biden? I mean, just the physical reaction to that, and so he's got to put it at ease folks that are thinking, I don't know if I really want to watch another rerun of this all over again.

KING: Your faces elections are authored about that. Kristen, appreciate your company.

Well watch the President tonight. And you should be sure to join us. Please watch CNN's live coverage of President Biden State of the Union address starts tonight 8:00 p.m. Eastern right here. We'll be right back.



KING: I want to bring you some important news just in to CNN. Sources telling us the Labor Secretary, Marty Walsh, will soon leave the Biden administration. Walsh, remarkably, would be the first Cabinet Secretary to exit during President Biden's tenure.

Let's get straight to the White House. CNN's Phil Mattingly is there. Phil, tell us more. PHIL MATTINGLY, CNN CHIEF WHITE HOUSE CORRESPONDENT: What we are understanding right now according to sources familiar with the matter is Labor Secretary Marty Walsh will soon depart in order to take a job as the executive director of the NHL Players Association. Longtime Bruins fan is the current labor secretary, sounds like a pretty good gig that he has lined up. Now, it's not official yet. And obviously, he will be in the audience for the President State of the Union.

But I think what this underscores right now is as you and I both know, John, this is a typical traditional moment of transition for any administration after the second year. We've seen some internal transition. White House Chief of Staff Ron Klain will be leaving tomorrow. National Economic Council Director Brian Deese will be leaving shortly as well.

But we have seen remarkable stability across the Cabinet level. Marty Walsh had not been expected to leave at least in the near term until this opportunity came up. Now that appears likely to happen.


Other critical Cabinet members at this point in time, we don't know of anybody who's leaving imminently. But when it comes to Marty Walsh, I think the importance here is just how significant a role he's played inside the administration.

If you think about some of the major kind of pop-up economic crises this administration faced, whether it was on supply chains, whether it was on rail strikes, or the potential for rail strikes, Marty Walsh was always in the center of those, was always President Biden's kind of delegated representative to deal with labor, to deal with business and try and find some common and middle ground here, and often, if not always, successfully, did close to the President, obviously, as labor often is.

And I would note, it's good to see somebody from Dorchester moving on to good things, John. You might know something a little bit about that Hockey, the Bruins, Dorchester, but this is a good example of Dorchester boy doing well.

KING: I was waiting for that one. I was waiting for waiting for that one, son of Ohio. Phil Mattingly at the White House. Phil, thanks for that.

Look, it is a good story. I'm a Dorchester kid. Marty Walsh, the compelling personal story, union labor, battled alcoholism, went on to be mayor of Boston. Now he's a member of the Biden Cabinet as Phil notes. He said, is a guy not from Washington. He's been in the middle, the thick of some big issues here.

So number one, what is the President lose here? The President self always says he's, you know, the brother of the labor. He loses a guy here who actually was a union worker.

LEE: Yes. And, you know, it's interesting. There was a moment earlier in the administration, when we actually expected there to be a flood of departures. We never saw that coming. That never actually happened. And now I think we are at a moment of transition where after the State of the Union, we will get more announcements like this.

I think there are two factors for why we haven't seen this moment come yet. One is just that the administration in the White House has really been on a winning streak, you know? You want to be on the winning team. And with the economy rebounding, obviously, the good results for Democrats in the midterms, there were a number of people that I think sort of decided to stick around, because it feels good when the administration is on a good track.

I think the other thing is just the Biden factor, right? It's not been totally clear over the last several months, whether for sure, the President was going to run up for re-election in a second term. Now we know that we are expecting him to announce for another four years in the coming weeks. And I think people -- certain people in the administration, have sort of been waiting for clarity on that moment and now we have that.

ZANONA: And we should also point out in terms of confirming his replacement. Now Democrats added a seat in the Senate. So it'll be easier to move nominations and confirm nominations. I don't know if that was a factor in the decision making, but it certainly will be something that we are watching.

KING: And you mentioned the lack of -- the very limited turnover, especially at the Cabinet level. This being the first one. There was some talk that because of disagreements over policy between the White House, the Department Homeland Security, that Secretary Mayorkas would be maybe one of the early ones to go.

And then the Republicans threatened to impeach him, which may -- which immediately gets everybody in their partisan quarter. And his job security is better now because the Biden ministration is fine. Let's have that fight.

WOOTSON: Yes, exactly. And I think the question are what this kind of sets up after the State of the Union is? You know, what does Biden have for this fight with Republicans going forward with a Republican- led House, and all that stuff? He has a lot of people around him, a lot of trusted advisers, you know, claims gone, this is gone. Marty Walsh is gone but there's a lot of stability there that allows him to make a better argument to the American people tonight and over the next few years.

KING: Right. That is a great story as a kid from Dorchester, Marty Walsh -- Maddy (ph) Walsh, as we say back home. He's from the wrong parish. But he's doing all right.

Let's -- before we go quickly, Sarah Huckabee Sanders who delivered the Republican response tonight, she's a former Trump White House press secretary. So people around the country know who she is. She's been governor for less than a month. Why? Why did the Republicans decide she is the person we want to put forward at this important moment? ZANONA: Well, you know, she's young, she's a woman. But I think another factor is that she's not a threat to Trump in terms of potentially running against him. If they would have picked someone like DeSantis or Tim Scott or someone, it could have been perceived as them trying to position someone else to take Trump on. So I would suspect that is a factor.

But she is someone who Republicans love. She was in the Trump White House. She gave it to the press. They love that. She's been in the governor's mansion for a little bit attacking some of these, you know, red meat issues. And so I think that Republicans, you know, are excited to hear from her tonight. It's a big opportunity for her.

KING: It's always a tough job, you know, to deliver the response. Her dad was the governor. It is the first father-daughter team to be governor. Someone says, why? Why Sarah Huckabee Sanders?

WOOTSON: Well, I think, like Melanie said, you know, she does have the Trump imprimatur. She does not pose a threat really to any Republicans out there. But also, you know, she's used to speaking to the country, right? She's used to making that sort of cogent Republican argument to the country and that has to be an advantage when you're going up against Biden.

KING: And she has, to your point, she has leaned in very aggressively right out of the box banning Latinx from any state documents, saying critical race theory will not be taught in the Arkansas public school. She says like many governors and attorneys, generals, Republicans say we're going to look to ban drag shows.


LEE: Yes. And certainly, these kinds of sort of culture war issues are issues that people with 2024 aspirations have really embraced. And I don't think that is surprising. You know, Republican, elected officials or people with political aspirations are very much seen that the sort of lightning rod issues have been an effective tool to some extent in sort of rallying their supporters.

But I do think there are plenty of Democrats who would say, no, it's not always a winning message, like some certain specific issues maybe but also not necessarily in a general election.

KING: Plays -- but that's the key point, plays well with a slice of the Republican primary electorate. We'll see. I'm guessing tonight is going to be much more about economics and tone out in the country.

Again, President's State of the Union address tonight. Hope you will join us. Thanks for your time today on INSIDE POLITICS. Abby Phillip picks up our coverage after a quick break. Have a good afternoon.