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Flake Issues Call to Action to GOP Senators; Senate Kills Rule That Made it Easier to Sue Banks; Source: Clinton Campaign & DNC Helped Fund Dossier Research. Aired 6-6:30a ET

Aired October 25, 2017 - 06:00   ET

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

(BEGIN VIDEOTAPE)

SEN. JEFF FLAKE (R), ARIZONA: We must stop pretending that the conduct of some in our executive branch are normal.

[05:59:13] WOLF BLITZER, CNN HOST: When he lies about something and you know it's a lie, shouldn't you speak up?

UNIDENTIFIED MALE: That's your job.

JEFF ZELENY, CNN WHITE HOUSE CORRESPONDENT: This is a fight for the heart and soul of the Republican Party.

SEN. BOB CORKER (R), TENNESSEE: I don't know why he lowers himself and debases our country.

REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: All this stuff you see on a daily basis on Twitter this and Twitter that, forget about it.

UNIDENTIFIED MALE: His coalition to get things passed is now in some jeopardy.

UNIDENTIFIED MALE: Bob Mueller's team has corroborated many key aspects of the dossier. There's no shame in the fact that the campaign sponsored it.

UNIDENTIFIED FEMALE: There's a lot of motivations in the White House today to distract a little bit here.

UNIDENTIFIED MALE: Why did they spend a year covering it up?

(END VIDEOTAPE)

ANNOUNCER: This is NEW DAY with Chris Cuomo and Alisyn Camerota.

ALISYN CAMEROTA, CNN ANCHOR: Welcome to our viewers in the United States and around the world. This is NEW DAY. It is a very busy Wednesday, October 25, 6 a.m. here in New York. Here is our starting line.

We begin with an extraordinary day of Republican rebuke against a sitting president. Two retiring GOP senators calling out President Trump as dangerous and utterly untruthful. Senator Jeff Flake says he will no longer be complicit or silent, and

he issued a call to fellow Republicans to follow. Senator Bob Corker says the Trump presidency will be remembered for, quote, "debasing the nation."

So this civil war could challenge the GOP and threaten the president's agenda. Not surprisingly, the White House is defending Mr. Trump's clashes with both men.

And coming up on NEW DAY, Senator Jeff Flake will join us live.

CHRIS CUOMO, CNN ANCHOR: For every action there is a reaction. And House Republicans are trying to turn your attention to new congressional inquiries that they are driving into the actions of the Obama administration.

Three House committees are now investigating the Justice Department's handling of the Clinton e-mail probe and the government's decision on a uranium deal that some in the GOP think that Hillary Clinton engineered.

This comes as we get more details on the Democrat pockets that help fund the infamous Trump Dossier. The Democratic National Committee and the Clinton campaign did help fund research containing allegations about Donald Trump and Russia.

We have it all covered. Let's begin with CNN's Joe Johns live at the White House -- Joe.

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Chris.

Two prominent Republican senators slamming the president with a message, "This is not normal," putting the Republican war on full display across the United States for everybody to see.

Senator Jeff Flake's speech on the floor of the United States Senate really captured the imagination of a lot of people and also created big problems for the White House. The arithmetic could be changing at a time the White House could scarcely use it.

(BEGIN VIDEOTAPE)

FLAKE: It is time for our complicity and our accommodation of the unacceptable to end.

JOHNS (voice-over): Outgoing Senator Jeff Flake fiercely denouncing President Trump's policies and behavior as dangerous to democracy and calling on his fellow Republicans to do the same.

FLAKE: When the next generation asks us, "Why didn't you do something? Why didn't you speak up?" what are we going to say?

JOHNS: Flake railing against the politics of the era of Trump, the undermining of democratic ideals, the personal insults, and what he called the flagrant disregard for truth and decency. FLAKE: Reckless, outrageous and undignified behavior is excused and

countenanced as "telling it like it is" when it is actually just reckless, outrageous and dignify -- undignified.

We were not made great as a country by indulging in or even exalting our worst impulses; turning against ourselves; glorifying in the things that divide us; and calling fake things true and true things fake.

JOHNS: Senate Majority Leader Mitch McConnell praising Flake but punting when asked by reporters how the party would respond.

UNIDENTIFIED FEMALE: At what point do you have an obligation as a leader of this party to weigh in on these very serious criticisms of the president?

SEN. MITCH MCCONNELL (R), KENTUCKY, MAJORITY LEADER: What I have an obligation to do is to try to achieve the greatest cohesion I can among 52 Republicans to try to achieve for the American people the agenda that we set out to achieve.

JOHNS: Flake's sweeping indictment coming hours after Republican Senator Bob cork also blasted Mr. Trump.

CORKER: The president has great difficulty with the truth.

I don't know why he lowers himself to such a low, low standard and debases our country in the way that he does, but he does.

JOHNS: The retiring Senate Foreign Relations Committee chairman expressing concern that the United States' position in the world is suffering under President Trump.

CORKER: World leaders are very aware that much of what he says is untrue. He purposely is breaking down relationships we have around the world that have been useful to our nation.

JOHNS: Their feud reaching a boiling point, with the president responding to Corker's attacks in a series of tweets, again calling him "little."

The White House brushing off the criticism as petty while welcoming the decision of the senators to retire.

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: I think they were not likely to be re-elected. And I think that shows that the support is more behind this president than it is those two individuals.

JOHNS: A source familiar with the president's thinking says he is in high spirits after Flake's announcement. An ally of Mr. Trump's former chief strategist also celebrating, saying, "Steve Bannon added another scalp to his collection as another establishment domino falls."

(END VIDEOTAPE) JOHNS: These two senators not running for re-election means they don't have to worry about being punished by the voters in the midterm next year. They'll be around until January of 2019. The White House needs their votes to get anything passed -- Chris and Alisyn.

[06:05:08] CUOMO: Joe, appreciate it.

Let's bring in the panel. We have CNN political analyst David Gregory; and CNN Politics reporter and editor-at-large, Chris Cillizza.

Let's play more of Senator Flake, because what we're trying to tee up here is that this is unusual, what we heard on the Senate floor, starting with former President Bush. You had McCain. You had Corker. Corker again. And now Jeff Flake in this speech. There was a smattering applause for it. Let's listen to more.

(BEGIN VIDEO CLIP)

FLAKE: The personal attacks, the threats against principles, freedoms and institution, the flagrant disregard for truth and decency. The reckless provocations, most often for the pettiest and most personal reasons, reasons having nothing whatsoever to do with the fortunes of the people that we have been elected to serve. None of these appalling features of our current politics should ever be regarded as normal.

(END VIDEO CLIP)

CUOMO: So, David Gregory, what are we to make of this? How significant is it?

DAVID GREGORY, CNN POLITICAL ANALYST: Look, it's incredible to hear two Republican senators going out of their way to criticize the sitting president of their own party to break with him in such dramatic fashion, to call him out on being someone who doesn't have the temperament to be president who's debasing the country, amazing; really significant.

If you oppose Trump, maybe you say, "Wow, where have you been and where are more of you?"

On the other side of that, these are two men who will be gone from the U.S. Senate. Flake and Corker will not be there anymore. It's hard for me to wake up this morning and look at this objectively as anything other than a pretty good day, for now, for President Trump.

Maybe history regards this moment differently, if there are others who come along and widen or deepen the schism in the Republican Party. But for now this is a confirmation of what Trump and his allies have said is the problem with Washington at a time when the Republican Party is trying to unify.

Now Mitch McConnell, I'm sure, doesn't like it, because he has to wonder about does he have the votes to get a tax cut plan passed, which is his real goal to keep the party together. CAMEROTA: So Chris Cillizza, why now? I mean, Jeff Flake and Bob

Corker, they have 14 more months in the Senate. So why did he give that impassioned speech yesterday?

CHRIS CILLIZZA, CNN POLITICS CORRESPONDENT AND EDITOR AT LARGE: Well, I think we've been waiting for Flake, Alisyn, to say something about his re-election. Because candidly, and this is to David's point, he almost certainly wasn't going to win a Republican primary. This is the peril of facing down Donald Trump. You may get touted by sort of the establishment in Washington, or at least parts of it, but in your home state it might not work out.

His opposition to Donald Trump, most notably through his book that he wrote in the spring, "Conscience of a Conservative," had really hurt him in the state. Kelly Ward, who had run -- a former state senator, who had run against John McCain unsuccessfully in a primary in 2016, there was polling that had her up, basically doubling Jeff Flake.

So I think, for some, it was a recognition of what is somewhat obvious, which is Jeff Flake sacrificed himself to try to make this point. He sacrificed himself and his political career to say, this is not Republican, this is not conservatism. Down this road lies, following Trump, lies nothing good.

But make no mistake: he sacrificed himself. He was not going to win a second term. And so, I think in some ways it's simply a recognition of, frankly, pretty obvious political reality.

CUOMO: He wrote an op-ed in "The Washington Post," guys. Here's a part of it for the audience. There's a sickness in our system, and it is contagious. How much more damage to our democracy and to the institutions of American liberty do we need to witness in silence before we count ourselves as complicit in that damage?

You know, John McCain and Jeff Flake both used this same word, "countenance." Jeff -- Jeff Flake used it about his ability to countenance what the president is doing. John McCain said that he wouldn't countenance how some people had gotten out of the war. And it's an interesting word, because David, it suggests that you sit there with a calm face while something is going on, but that is exactly the face of the Senate majority leader, Mitch McConnell. His explanation for it is not that this is cowardice. That I am here to enforce an agenda, and that is my priority. And everything else is second to that. Does that work?

GREGORY: Well, you know, it depends who's answering that question, Chris. I mean, look, McConnell's made a calculation that "I'm going to grit my teeth and bear whatever the Trump years look like, however long that lasts, because I have an opportunity to stay in power, not just individually, but Republicans stay in power, if we can get big things done." Like tax reform, something they want to do.

That's why Paul Ryan is hanging in there. This is a signature moment for conservatives like a Jeff Flake.

But the other side of it that means you're going to be quiet and not say anything in the face of this kind of behavior, threats to our democratic system that are kind of casual threats by the president.

But here's the other side of this. I was in New Hampshire last week, talking to a classic New Hampshire independent voter who had been a Democratic voter in the past, supported Trump and critical of Trump in some areas. But she says in the end that it's Congress that needs the reckoning. So she's not going to be sympathetic to the Corkers and the Flakes. Because she thinks that system is still broken.

She wakes up this morning and says, yes, I mean, Trump is probably still doing something right. And that's the thing for, I think, people to hold. If you're opposed to Trump or on the fence. That's what I think you have to hold in your mind as these revelations tumble out.

CAMEROTA: Yes, I mean, we have -- maybe we have it, the cover of Breitbart. Steve Bannon taking a victory lap like good riddance is the feeling for all of these, you know, establishment types, as they call them.

CILLIZZA: And Alisyn, make no mistake, this is a great day for Steve Bannon. Jeff Flake's retirement, while mourned by some in the Senate, will be cheered by folks like Steve Bannon. It will help him raise money. It will help him recruit people against these other incumbents. He will say the establishment is running scared.

The people who think Jeff Flake retiring is a bad thing are the very establishment that Steve Bannon, frankly, thinks need to go. Can I make one point about Flake's speech that I thought was important?

David mentioned this. What Flake essentially said this is a shining moment for Republicans -- should be a shining moment for Republicans, but I am not willing to do what needs to be done. The sacrifice of principle is not worth what we will gain. I don't know that that is a decision that a lot of his fellow colleagues will make.

You saw Mitch McConnell praise Jeff Flake the second he stopped speaking on the Senate floor, but Mitch McConnell had zero interest in engaging in any way, shape or form after that luncheon with Donald Trump on this issue of the criticism of the Republican Party, what's happening. Is Trump a Republican? Is he leading the party down a path toward destruction?

So, Jeff Flake, I think, made a personal decision that it wasn't worth it for him, but I don't think that that's going to be the decision that the -- decision that most people within the party make.

CUOMO: Fellows, appreciate your take on this. It sure was unusual. Everybody will have to agree on that. What his impact is, we'll see. And probably soon.

All right. Coming up on NEW DAY, we're going to speak with Senator Jeff Flake. Why did he do this now? What will be next for him?

CAMEROTA: All right. We also have some breaking news for you. Another Obama-era reversal. Senate Republicans killing a rule that made it easier for Americans to band together to sue banks and credit card companies. Vice President Mike Pence casting the tie-breaking vote. What does this mean? We have CNN's chief business correspondent, Christine Romans joins us now with more.

Hi, Christine.

CHRISTINE ROMANS, CNN CORRESPONDENT: It's a big win for Wall Street really here. President Trump wants to loosen Wall Street regulations, and this is his biggest win yet, and it's a blow to the Consumer Protection Bureau. Gone now is a CFPB rule banning forced arbitration causes. That's in the fine print of the contracts you have with your banks, your credit cards and other financial companies. It forces customers, us, to resolve disputes outside a courtroom, blocks us from banding together in class-action lawsuits.

Republicans call that rule an overstep by the CFPB head Richard Cordy, who was appointed by President Obama. And they claim class-action suits benefit trial lawyers not consumers.

But consumer advocates disagree. They argue that arbitration favors the company, companies have all the leverage. And the example they used is Well Fargo. Victims there have had trouble suing because of the arbitration clauses.

Now, this rule was just issued in July so those folks who were aggrieved by Wells Fargo can't use this. Now, the CFPB found the customers struggled to open arbitration cases against their banks. Again, the government's financial watch dog says this was a problem. The Senate has overruled it.

CUOMO: Christine, appreciate it. Thank you for making that clear for everybody.

Up next, new information about the Trump/Russia dossier. Well, you know it wasn't free. Who funded it? It was Republicans; it was Democrats, but now we know which ones. And there's a big clue on your screen.

[06:15:00] Also, House Republicans launch investigations into the woman who was just on your screen. Hillary Clinton. What's going on here? This seems like an obvious distraction from what's going on in the government right now. How will this play out? We discuss next.

(COMMERCIAL BREAK)

CUOMO: If you've been following along and watching the show, you know that the infamous Trump dossier was funded by both parties, but who was doing it is now more clear. A source confirms to CNN that Hillary Clinton's campaign at a Democratic National Committee helped fund research that led to that dossier of allegations about Donald Trump and Russia.

Now technically, it was a law firm who paid but they represented the Clinton campaign and the DNC. "The Washington Post" was first to report this story. And joining us now is one of the "Post" reporters on that article, Adam Entous. He's a CNN contributor.

Good to see you, Adam. Let's jump ahead two steps to how this story is being received, specifically by supporters of President Trump.

The dossier is a phony. It was paid for by his enemies. And all the investigations into Russia, therefore, are fraudulent. What do you make of that?

ADAM ENTOUS, REPORTER, "THE WASHINGTON POST": Well, I mean, it is true that it was paid for by his enemies, but certainly, the intelligence community has stood up some of the underlying assessments or allegations that are contained in these reports that were prepared by this contractor for Fusion GPS, a former British intelligence officer named Christopher Steele.

Not all of the information, and particularly the most salacious details, have been confirmed, and they may never be confirmed. But the -- but, you know, the findings that he had that basically the -- you know, that the Russians were trying to help Trump, and some of these connections has been certainly alleged also by the U.S. intelligence community and is currently under investigation by the FBI. And CNN and "The Washington Post" have reported some of these -- some of these meetings, not all of them, but some of them.

CUOMO: Because the implication is, "No, no, no, all of this stuff was cooked up by Clinton," and that it was she and her campaign and the DNC, they put people up to try to frame the Trump campaign. That is the narrative that's being spun today in conjunction, no small irony, with these House investigations that are a blast into the past of the Obama administration. Do you believe that that's a justifiable basis on your reporting?

ENTOUS: Well, I think, you know, I think it's important for people to understand who was bankrolling this effort, this investigation that was being done by Fusion GPS. That is a legitimate question and one that's now been answered.

You know, the issue now is, you know, what is the nature of the investigation currently being run by the special counsel? Whether or not that is going to stand up details that were in these reports is yet to be seen. And where that investigation goes, we don't know. I think that's really the important question.

It doesn't -- you know, the fact that Hillary Clinton's campaign and the DNC, through a lawyer, was funding this research doesn't affect the fact that there is a special counsel who's investigating whether or not there was any coordination between the campaign and the Russians.

CUOMO: It is true. And obviously, the special counsel's investigation didn't just grow out of the dossier. We don't even know what role the dossier plays in the questioning of his investigators. But there's one thing for sure, it fueled a lot of political intrigue. What do you think the next step is?

ENTOUS: Well, I think there's probably going to be a lot of questioning now about who, you know, within the campaign, who with DNC had visibility into this -- into the decision to hire Fusion and receive their intel reports that was being produced by Chris Steele. So that's probably a line of inquiry that's going to continue now for a few days.

And I'm sure the Republicans, like you said, are going to seize on this as evidence that their -- that their counternarrative that they're trying to put out there to the investigation into Trump's ties to Russia is based on a fact that the Hillary campaign was behind funding this research.

So obviously, though, the next step would be waiting to see what Mueller, the special counsel, finds in his investigation.

CUOMO: We're going to be waiting some while for that. And remember, he doesn't have a duty to tell us. He only has to tell the A.G., so what we learn is a big question mark on that. But one thing's for sure. These facts will provide fuel for the fire.

Adam, thank you very much. Appreciate you bringing the reporting to us.

CAMEROTA: OK. Let's bring back our panel to help us sift through all of these conflicting claims and all of these threads of these new investigations. We have David Gregory and Chris Cillizza.

So David Gregory, you just heard the reporter there for "The Washington Post." How significant do you think it is to this opposition research that ended up in the infamous Russian dossier that was first funded by anti-Trump Republicans and then the tab was picked up by the DNC and the Clinton campaign?

GREGORY: Well, I think there's a couple levels about this. And Chris's conversation with Adam got to it, right? I mean, there's going to be the political reaction, and there's the substantive reaction.

The latter is going to take a longer time. Because there are elements of that dossier that CNN did not report on because of the salacious details, which were unconfirmed. And there was restraint, no matter what Trump allies say there was restraint on the part of CNN in the initial reporting of that dossier as reporters dug into it.

But what the special prosecutor does with some of these facts, if they were able to be stood up and confirmed and other aspects of potential collusion with Russians, on top of established facts of interference on the part of Russia, that's the key thing to focus on. We don't know how that plays out.

Again for now, this is analogous to our discussion about Jeff Flake. I think the here and now is about a president who will say, "Aha, you know, here it is. I told you it was my political enemies who were probably responsible for leaking all of this stuff."

And remember, our intelligence chief said at the time -- and I think this is damning -- they said, look, this was out there sufficiently that we felt we had to inform the candidate and then the president- elect. And so it got into the bloodstream of our intelligence community, something that was basically political oppo research. I think Trump allies will use that as a cudgel against their enemies. CUOMO: Listen, so many reporters can say the same thing that I can,

which is I've never talked to anybody involved with the investigation. For me it's all about the dossier. That's what it's always been. It's always been something it was more of a shiny object.

[06:25:11] But, Chris Cillizza, they now have a new card to play, which is...

CILLIZZA: A hundred percent.

CUOMO: ... Clinton knew, and she never said a damn thing about it. That's all I heard when this came out from people: why didn't she ever say anything? Why didn't her campaign ever fess up to this before now? What's your take on that?

CILLIZZA: Well, so at one level this is what campaigns do, which is try to collect opposition research on the other side. Right? I mean, both sides do this. If you don't do it, it's basically campaign malpractice.

That said, the uncertain funding of this and now it being linked directly to the Clinton campaign and the DNC, gives -- David touched on this -- it gives Donald Trump, every Trump ally a huge card to play to say, "Told you. Partisan witch hunt. Mueller's investigation is a partisan witch hunt, too."

Now, obviously, you're conflating a lot when you do that. Mueller's investigation, the special counsel was not formed by the way it was formed by Rod Rosenstein, a lawyer in the Justice Department, not by the Clinton campaign, but it was not formed because of the dossier.

The dossier is a piece of it because of some of the more salacious details. It's something that's drawn a lot of attention. But that's not the fundamental core of this entire special counsel investigation.

But Donald Trump has from the start, via Twitter and other things, said witch hunt, hoax, all partisan, Hillary Clinton and her allies are doing this. This will be something that is not something he has sort of made up from whole cloth, which he has done before. But this is not that. This is the Clinton campaign and the DNC being behind something.

And really the key is not -- the fact that we're learning of the funding source now, right? That's the key. Democrats helped fund an opposition research effort against another candidate is not a big deal.

CAMEROTA: Yes, yes. Got it. So now let's talk about these two investigations that have come back with a vengeance and as was announced by House Republicans yesterday. They say that they are going to spend, you know, obviously time and energy and money looking into -- and they're complicated, right.

So first is uranium one, OK? That is the deal that allowed this Russian nuclear agency to get something like a 51 percent share of a U.S. uranium company. And nine federal agencies signed off on it, including the State Department when Hillary Clinton was there.

So David, what more do we need to know about this? Why now are Republicans in the House looking back into this?

GREGORY: Well, they're doing it because, you know, this is the -- this is the rebuttal, that the real Russia scandal is this, you know, that some kind of sweetheart deal for the Russians on nuclear energy that Hillary Clinton was behind.

I mean, you know, this is -- this is what the American people are treated to in this back and forth. You know, stories that are difficult to wade through, story lines that are reduced to their simplest form, and that it's -- you know, it's basically on the one hand, on the other hand, that people have to reckon with.

And so, look, this is a distraction on the part of, you know, in most cases allies of the president who are pushing back against all of these narratives. And this is why...

CUOMO: This is why, David, to your point earlier, this is why with Jeff Flake, with Bob Corker, with John McCain, this is why it doesn't sink in the way it does when you hear the words. Because people don't trust the institution. They say, "This is what they do, Cillizza. They don't like the outcome from the investigation. Now they hold their own. They want to look into Russia. They look; they find nothing."

CILLIZZA: The truth is that this will give -- if you watched or consumed conservative media over the last 72 hours, all they talked about was uranium one and how this was the real Russia scandal.

So now, look, Congress is a reactive body. True Democrats handle Republicans. They see their base constituents getting up in arms about something they move to address it. So this will do that, and it will provide a narrative out of Capitol Hill that is not the House and Senate Intelligence Committee investigating Russia's attempt at meddling in the election. Right? It will be a "the Clintons and Barack Obama, they did some stuff, right?" I mean, it's obvious it's vague. "They did some stuff, and we're going to look into it." It's a lot better story line than talking about Donald Trump and the split within the Republican Party.

CAMEROTA: Got it. Gentlemen, thank you very much for all of the analysis.

CUOMO: It's the old expression: the timing tells you what you need to know. Why did it come out now? Why do you think?

All right. So China's president reveals his new leadership team, proving himself more powerful than ever. But there's something missing from the unveiling. We have a live report from Beijing next.

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