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Trump Tariff Threat: Export Jobs, Pay Up; 36 Dead In Oakland Warehouse Fire; White Nationalist To Speak At Texas A&M University; Trump's Children & Potential Conflicts Of Interest. Aired 7:30-8a ET

Aired December 06, 2016 - 07:30   ET

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

[07:30:02] CHRIS CUOMO, CNN ANCHOR: Will it work? Will it ever get passed? Let's talk to a longtime friend of Donald Trump and the executive chairman of Colony Capital, Tom Barrack. He joins us now. He's also the chair of the Presidential Inaugural Committee. It's good to have you here.

THOMAS BARRACK JR., CHAIRMAN & CEO, COLONAL CAPITAL: Thanks, Chris. Great to be with you.

CUOMO: So, the tariff sounds good. Yes, yes, they're going to move their jobs and hurt our workers. Let's hurt them, too. Politically, it's getting pushback. One point of it is we don't pick winners and losers. We don't selectively pick which companies will benefit or not. And the second one is that they believe that those tariffs will be passed back on to our consumers. What do you think about the tariff?

BARRACK: Look, obviously, it's complicated and what we're getting is just the beginning of a notion from the president-elect, right? I mean, you have a congressional piece here that's very important. He can impose tariffs without that under two or three emergency laws. Whether he would do that or not is probably questionable.

But, you know, tariffs -- if you go back to history and look at Smoot- Hawley at the beginning or the Marshall Plan or GATT, the complexity of these tariffs was really a foreign policy tool, it wasn't about jobs. So after World War I when the Paris Peace Conference started, it was about trying to help and encourage Europe along at the sake of Germany.

World War II started. After World War II, the devastation was all about the Marshall Plan and GATT, which was subsidies to encourage Europe and then Japan to be able to survive, so it wasn't ever focused on what does it mean to American jobs.

So, it's a -- it's a bit like an aircraft carrier. Imposing tariffs is something that hasn't been done in the last 15 or 20 years. These multilateral trade institutions are a bad idea in this president- elect's mind. Why, because you've now delegated the responsibliity of 535 congressional people -- the Presient of the United States -- to bureaucracy, and that bureaucracy's interest is in propogating the bureacracy.

So i think all these tariff discussions are like tiny little waves on an aircraft carrier. You have to adapt all of them, trying to find the center to stop what we talk about currency manipulation. (Audio gap) -- major factor. So this issue of currency manipulation alongside of tariffs is very complicated because currency manipulation is just the Central Bank buying U.S. dollars and bonds. Sometimes that's good, sometimes it's bad. Sometimes it affects the currency up, sometimes --

CUOMO: So how should we see what Donald Trump is saying because it doesn't seem nuanced at all? It seems that he's saying I'm going to punish companies who move jobs overseas by putting a tax on whatever they sell back here. It doesn't seem like it's part of any coordinated subtle negotiation.

BARRACK: Oh, i think it is. Look, this is -- this is parry and thrust at the beginning of a discussion. All of the -- all of these thunderstorms that you're hearing are the preface to a serious conversation. I think what you see this president-elect saying is we're going to have serious conversations. What happened in this election was a recall. It wasn't that President Obama was bad, it wasn't that the policies were bad, it wasn't that they failed tremendously. It was that American wanted something different and something different is making everybody accountable. Just drawing clear lines.

So (audio gap) have an equal battlefield. So the tariffs --

CUOMO: Tom, just so you understand -- just for the people who are watching because they -- you know, this audience is very engaged. They've been following this whole thing. That all sounds very reasonable, what you just said. Donald Trump has said none of that. He's said that every President Barack Obama has ever touched has turned to dust and is terrible. None of his policies have been worth a damn and that he's not bluffing. That this 35 percent tariff is just what it's going to be, just like the wall, just like all the other promises, so which is it?

BARRACK: I think it's both. Look, the oath -- yes, absolutely. He can have an opinion. The president-elect can have an opinion of whatever he thinks of previous environments. Now, on November 7th, everybody had an opportunity to decide in a fervor debate what they thought. November 9th, we now have a new president. We should all line up behind. We should listen.

We have a process of a congressional and judiciary implementation that balances it all. And we're judging all of these remarks before he has any power, before he has consulted Congress, based on little tidbits without any structure to them. So i think we owe him to have an opportunity to wait. He's sending soundwaves of saying yes, I'm going to be much stronger.

CUOMO: So that's what we should hear? He says 35 percent tariff on these companies but you're saying see it as a soundwave of him saying we're going to sit down and talk, something's going to change. Don't hold him to the specifics just yet.

[07:35:09] BARRACK: No, I'm saying if it were me on the other side, i would say this man is going to do that. He's serious about imposing it unless we respond. So what's responding? To China, it's not really currency manipulation today that's the problem. It was a problem a year ago, it isn't today. They've put currency controls, they've stopped the flow of funds. They're $500 billion down.

What is it? It's intellectual property. So what's that competition of shipping technology out that they can buy free with no trademark protection or a U.S. company can send its goods and have them manufactured without any research and development. That's 35 percent of the cost of the good, right? It's just not fair. That part of it isn't fair.

So i think you have to bring everybody to the table and say let's equalize. If we equalize and we're fair everything will be fine. If not, believe me when i draw this line. I will draw the line and i, the Preisdent of the United States, will have the power, regardless of Congress. He's going to utilize Congress for sure but it's clear that the president has the power to impose these tariffs without congressional intervention under two or three laws.

CUOMO: That gets into a very complex analysis --

BARRACK: Absolutely.

CUOMO: -- as well, but let's leave it at there for now. Good luck with the inauguration planning.

BARRACK: Thank you.

CUOMO: We're still 40-something days out. As we get closer, please come back on and tell us what will all be down there.

BARRACK: I'm a better party planner than a politician.

CUOMO: Appreciate you being here. Good luck on both levels.

BARRACK: Thank you.

CUOMO: All right. A quick programming note for you. Vice Preisdent- elect Mike Pence is going to be live on "THE LEAD" at 4:00 Eastern today -- Alisyn.

ALISYN CAMEROTA, CNN ANCHOR: So, Chris, a criminal investigation is underway into what caused that deadly warehouse fire in Oakland. Next, we talk to someone who tried to warn people that the Ghost Ship warehouse was scary.

(COMMERCIAL BREAK)

[07:40:12] CAMEROTA: Oakland city officials do not know what sparked the inferno at the Ghost Ship warehouse in Oakland, California that killed 36 people at a late-night party. Joining us now is PeteVeilleux . He knew nine people in the fire, as well as the couple who ran the artist community there. Good morning, Pete. Thank you for joining us. I know that these past few days have been an ordeal for you. Do you know the status of the people that you knew inside? PETE VEILLEUX, FRIEND OF DEREK ALMENA & MICAH ALLISON: No. You know, the people that i know that lived there have all made it out. The people that i was close to all made it out, thank God, but there's a lot of other people and i have not gone through the list and looked photos. I've been kind of avoid that.

CAMEROTA: Yes.

VEILLEUX: So -- but i did go to the vigil last night and saw a lot of familiar faces and talked to a lot of people.

CAMEROTA: Yes. Pete, i know that you --

VEILLEUX: I know a couple of them.

CAMEROTA: Well, and we're for all -- the ordeal for the entire community there. I know that you described what the Ghost Ship was like inside and i think that you called it beautiful, but scary. What do you mean scary?

VEILLEUX: Yes.

CAMEROTA: What was it like in there?

VEILLEUX: It was -- despite being a really big space it was a -- it was -- it was full, very full, and it felt clautrophobic in places. But it was really a beautiful gallery space with really interesting work everywhere -- artwork everywhere -- and interesting things juxtaposed to each other in really unusual ways and really made people think in every corner, so --

CAMEROTA: Yes, we're looking at your pictures right now and i see what you mean.

VEILLEUX: Yes.

CAMEROTA: It is -- it is really beautiful but there is an eerie quality to it, in part because of sort of the low lighting that went on in there.

VEILLEUX: Yes.

CAMEROTA: But i know that you were concerned about the crowding issue in there and you're friendly with the couple, Derek and Micah, who run the Ghost Ship. Did you share your concerns with them?

VEILLEUX: Yes, i did. They had asked me if i would move in several times. I needed to move. I was evicted through an owner move-in eviction last year and they offered me a place here. It was very, very difficult for me to find a place. And finally, i found another place that was unsafe also where I'm living now. But this was just too risky for me. It was just too scary, mainly for fire and for lack of privacy also, so i didn't move in.

CAMEROTA: So you always felt that there was a possibility that that place was a fire hazard. VEILLEUX: Yes, i did.

CAMEROTA: Why do you think --

VEILLEUX: When i first went in there --

CAMEROTA: Yes, go ahead, Pete.

VEILLEUX: When i first when in there and i -- the last time i mentioned that -- there had been another fire previous to that and right away they just started telling me about that. And so, they knew also that it was scary but i guess the steps just were not taken to make it -- to fix it, so --

CAMEROTA: And, Pete, why do you think that they didn't take those steps and that they didn't get the right permits for that place?

VEILLEUX: I don't really know for sure, i can only speculate. But i speculate that people are desperate for housing, both for events and for residences, and when people get desperate safety kind of drops off the list of priorities.

CAMEROTA: Yes. Do you --

VEILLEUX: Unfortunately.

CAMEROTA: I know that you're friends with that -- the couple. Do you think that they deserve to face criminal charges?

VEILLEUX: I'm not -- and i'm really not in a position to say. It's, you know -- i really would rather not. There's a lot -- there's enough people out there, you know, shouting their opinions about that. I don't feel the need to do that. I feel the need to address the underlying concerns of the lack of safe, affordable housing.

CAMEROTA: Yes. And i know, Pete, that you've made the point that there are lots of other places like this that you've seen in the San Francisco area and around California --

VEILLEUX: Yes.

CAMEROTA: -- and this, obviously, is a terrible cautionary tale for everyone. Pete, thank you very much for joining us with all of yoru thoughts, and we're thinking about you --

VEILLEUX: Thank you.

CAMEROTA: -- and the community out there. Let's get to Chris.

VEILLEUX: Thank you very much.

CUOMO: All right. So there are protests planned today when Richard Spencer comes to speak at Texas A&M University. Spencer is a man who uses Nazi-era wording and imagery like he did at this Washignton, D.C. event. We showed you the video some time ago. So who invited this white nationalist to the school and why? CNN's Gary Tuchman has more. (BEGIN VIDEOTAPE)

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: This is the man who invited white nationalist Richard Spencer to speak at Texas A&M University. Preston Wiginton knows it will be controversial. He knows most people don't want this event to take place.

[07:45:12] What do you think of Richard Spencer?

PRESTON WIGINTON, SPEECH ORGANIZER: Um, i think he has some valid points.

RICHARD SPENCER, WHITE NATIONALIST: Hail Trump, hail our people, hail victory.

TUCHMAN: The Nazi-era wording, the Nazi-era imagery at this gathering in Washington, D.C. upsetting to so many. Wiginton, a political activist who lives in Texas, says he doesn't agree with all of Spencer's views but he certainly does some of them.

Do you think this is a white nation?

WIGINTON: I think it was at one time and i think that the reaction of Trump being elected and the reaction that's going on with the alt- right being popular is a reaction to the declining of the white nation.

TUCHMAN: Wiginton says he doesn't like to label himself but says he is sympathetic to the point of the view of the so-called alt-right, a relative new term for what in the past were simply called white supremacists.

WIGINTON: Why would i want to see american become less white? Why would i want to be displaced and marginalized?

TUCHMAN: Here's the -- here's the thing.

WIGINTON: Only people with mental illness want to be displaced and marginalized.

TUCHMAN: But here's the thing. You and people like you have this hang-up about the color of people's skin. What's the difference what color people's skin are? What matters is the kind of people they are. So why does it matter the pigment of their skin?

WIGINTON: It's not just pigment.

TUCHMAN: What is it?

WIGINTON: People's behavior, people's IQ. People evolve over different times --

TUCHMAN: OK.

WIGINTON: -- and different places.

(CROSSTALK)

TUCHMAN: There are lots of -- there are lots of white people with low IQ's. There are lots of black people with high IQ's. There are lots of red people with low IQ's and high IQ's. Everyone's different -- you're stereotyping. So my question is don't --

WIGINTON: Better the devil i know than the devil i don't.

TUCHMAN: Texas A&M does not want this event to happen and has officially rejected Richard Spencer's views, but says it cannot ban the event because this is a public university. A number of students who oppose Spencer's visit have organized what is expected to be a large demonstration. They pledge to keep it peaceful.

NICHOLAS MEINDL, TEXAS A&M GRADUATE STUDENT: We have a responsibility to take measured action to counter white nationalism, white supremacy.

WIGINTON: Yeah, i think there's going to be outside agitators, by all means.

TUCHMAN: Wiginton, who is a former A&M student, is mentioned on the website of the Southern Poverty Law Center, a monitor of hate groups which says he has declared he wants to "prevent the populations of white nations from becoming what he has termed a homogenous muddle of sludge." Wiginton says he was misquoted, but doesn't deny the point of the quote and says there is a way to make America more white.

WIGINTON: A ban on immigration, if not a strict curb on immigration. I don't think that you can bring Somolians into american and expect them to assimmilate. It's a completely different culture. It just doesn't happen.

TUCHMAN: But some Somolians can, right?

WIGINTON: Oh, i would be very selective on that. I think we just freely let too many of anybody into america.

TUCHMAN: So that's what prejudice is, though, is that you're saying they should all not come.

WIGINTON: Well, you know, when you --

TUCHMAN: There are bad people -- there are bad people that absolultely should not be in this country from all nationalities, all creeds, all religions, but by saying that all Somolis shouldn't come here, isn't that being a bigot?

WIGINTON: Um, sometimes maybe bigot is wise.

TUCHMAN: Gary Tuchman, CNN, College Station, Texas.

(END VIDEOTAPE)

CAMEROTA: Wow. That's hard to listen to.

CUOMO: Yes, part of the First Amendment. I'd like to know a lot more about why the university's administration is having the man come to speak. What they think the benefit is to their students who will be exposed to this. But, Gary did a good job in helping you understand where this person's mind is.

CAMEROTA: Definetely. While President-elect Donald Trump's children will reportedly be taking over his businesses they will also somehow play a role in the transition to the Oval Office, and maybe beyond. So what are the conflicts of interest here? We dig deeper with two reporters on the case, next.

(COMMERCIAL BREAK)

[07:52:44] CAMEROTA: OK, it's time for CNNMONEY Now. CNN business corespondent Alison Kosik is in our money center with a look at some of the fresh record highs for the stock market. Hi, Alison.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Hi, Alisyn. So, yes, the Dow sitting at its highest level ever this morning and we could see yet another new record at the open. We are seeing futures inching higher at the moment. Stock markets in Europe and Asia, they are rising as well. Oil prices are down slightly.

And in its quest for world domination, Amazon is taking on grocery stores and taking away the checkout lines. Amazon Go is a new app that's tied to a physical store and how it works is customers check in at the entrance, they grab what they need, and poof, they just walk out with their stuff. Amazon tracks the items automatically and it bills users through the app. The first is in Seattle. It's going to be opening up to the public next year. I am defintely on board for not waiting in those grocery lines.

CAMEROTA: That is great. I was excited that i thought you didn't have to pay for it at first, but then Amazon sends you your tab.

KOSIK: It's not that good.

CAMEROTA: Got it.

CUOMO: You have a different curve of consumer information that's needed.

CAMEROTA: Yes, yes.

CUOMO: All right. So, President-elect Donald Trump says he's going to announce his plans next week to leave the Trump Organization to his children. There's going to be a big announcement, he said, and lots of legal documents. But with his children running the Trump Organization and obviously playing a role in the transition, conflicts of interest are an absolute, not a maybe. So what do we do about this?

"The New York Times" have been looking into all of this. We've got reporters Matt Flegenheimer and Rachel Abrams joining us now. Rachel, thank you very much for being with us. Matt, as well. What do people need to know? RACHEL ABRHAMS, REPORTER, NEW YORK TIMES: i think people need to understand that the Trump Organization is very much intertwined with Mr. Trump's children. They have relied on him for everything from legal expertise to financial help. Ivanka Trump has even relied on his organization for things like I.T., payroll, infrastructure, so it's going to be very difficult to separate these two.

CAMEROTA: So, Matt, let's dive into this. Let's talk about -- let's start with Ivanka. So, what are the businesses that she has -- jewelry, shoes. Explain for people who don't know what Ivanka has built.

MATT FLEGENHEIMER, REPORT, NEW YORK TIMES: Well, in Ivanka's case, like many Trump businesses, it's often a licensing deal, a branding deal and her products are all over the world. We see domestically, internationally handbags, jewelry, shoes. These are items thatare, frankly, all over.

[07:55:05] In one case we looked at actually on the same day that Ivanka Trump was sitting in on a meeting with the prime minister of Japan and her father at Trump Tower, there was a private viewing underway in Tokyo for Ivanka Trump products as part of a licensing deal that she's nearing completion over there. So there's just this very sort of tangled web of business interests here.

CAMEROTA: And on that point with the prime minister -- with Shinzo Abe -- what is the -- help us understand. Play this out for us. So, she was in the meeting, as we know, with the prime minister, Rachel, and that we think gets her a sweetheart deal of something in Japan?

ABRAMS: I don't think we can say -- extrapilate that. We can't say why exactly she was in the meeting. We can't say that this even came up in the meeting. But what we can say is that she was in the middle of completing or finalizing a deal with a company whose largest shareholder is the government of Japan. And we don't know -- we've asked her representatives whether this even came up at the meeting. We don't know whether it came up at the meeting.

But what we do know is that it doesn't look very good, right, to have somebody who is in the middle of a deal with a company that has some kind of -- where the government of Japan has come kind of influence over them, so it just raises a lot of questions.

CUOMO: So, Matt, the ordinary standard would be semblance of impropriety. A conflict of interest isn't so much a legal thing at the executive level, it's that you don't do things that look bad, as Rachel was just saying. However, the rules have changed and the pushback you'll get on the reporting is what do i care? His kids are great, love his kids. Trump's a big businessman. I knew that when i voted for him. Why do i care about his business continuing? What is -- what does the research show on that?

FLEGENHEIMER: It's a fair question and Mr. Trump has said repeatedly people knew i had this business empire when i was running, and he's right about that. And it was interesting in his tweets last week about the announcement next week. He said if "visually important" was the phrase he used to make clear that he was taking something out of his business and -- legally or ethically. He said legally, he's on firm ground and there's a lot of experts who agree with him.

But these questions are going to persist even if it's not obvious in some cases if there is a conflict of interest. And that fact that he's doing business or the kids will be doing business internationally and any sort of diplomacy that he does with some of these countries is you're going to have to ask those questions about whether his business is benefitting.

CUOMO: Well, it would be impossible to extracate him, right? I mean, people kept saying he needs to put it into a blind trust, he has to sell his assets. That's impractical. It would destroy the business and you can't put a business in a blind trust like this one with shares in it.

FLEGENHEIMER: Sure, sure, and so much --

CUOMO: But he is -- he's only right about the law in that it doesn't exist, Matt. Your legal experts will say this is an obvious conflict of interest. It's an ethical morass at best. There's just no specific law but there's an obvious and specific problem.

FLEGENHEIMER: Oh sure, and there's really no precedent for this in terms of a president-elect who has this type of business coming into office.

CAMEROTA: Hey, Rachel, there was some talk during the campaign that Ivanka's businesses might be tarnished -- her business brand. Do we have a sense yet since her father won, business up, business down? Has this been a boon for the Trump businesses of all the kids?

ABRAMS: You know, i don't think we have good sense of whether business is up or down. She's a privately held company so we don't know sales figures. There was some chatter for awhile about companies such as Macy's or other large national retailers considering whether they should drop her brand because of a lot of things that her father said. There was time, even, during the campaign where she was taking efforts to separate herself from her brand because she was very concerned that her brand would be damaged.

But after the election it's hard to imagine that she is not going to come out of this better than when she started because now her name is even more famous. She's got much more, i guess, pull overseas. So i would imagine that net, it's probably a pretty good thing for her.

CUOMO: So what do you have to watch for journalistically, going forward? The conflicts are obvious, right? You don't have to spend much time on detailing that, but what do you need to look for going forward as to this problem being made manifest?

CAMEROTA: Rachel?

ABRAMS: I think that for the next four years it's going to be really important for journalists to pay very close attention to potential conflicts. I think this is an administration that is going to need to be put under the microscope and all of their deals are going to be looked at. We're going to need to make sure that we are examining any kind of potential business conflicts that could run up against potential diplomatic decisions, policy decision.

You know, not to say that we're expecting anything bad to happen, necessarily, but i just think it's going to be -- because of how unprecedented this is we're going to really need to pay close attention and to do our jobs.

CAMEROTA: Rachel, Matt, thank you very much for sharing your reporting with us. Nice to talk to both of you.

CUOMO: There's a lot of news. Let's get right to it.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We're excited to have Dr. Carson in Housing and Urban Development.

UNIDENTIFIED MALE: He's had no experience whatsoever and his background is in health care.

AL GORE, FORMER VICE PRESIDENT OF THE UNITED STATES: The meeting was a good one. We covered a lot of ground.

MIKE PENCE (R), VICE PRESIDENT-ELECT: We're looking forward to another very productive week.

CUOMO: General Michael Flynn and his son under fire for peddling conspiracy theories.

JOSH EARNEST, WHITE HOUSE PRESS SECRETARY: We shouldn't be propogating false things that could inspire violence.

UNIDENTIFIED MALE: These are very real world consequences or fake stories.

UNIDENTIFIED MALE: It was total fear that Mr. Scott didn't stop.

UNIDENTIFIED MALE: We are unable to come to a unanimous decision.

ANTHONY SCOTT, BROTHER OF WALTER SCOTT: Until my family can see justice, no, there's no forgiveness.

(END VIDEO CLIP)