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Trump Defends Tariffs: 'Trade Wars Are Good'; H.R. McMaster to Resign as National Security Advisor. Aired 6-6:30a ET

Aired March 02, 2018 - 06:00   ET

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

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: I get that the president ran on a bunch of this. But this trade policy will be disastrous.

[05:59:25] DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: What's been allowed to go on for decades is disgraceful.

UNIDENTIFIED MALE: One thing you've learned from this administration is, if you hold your breath, they may change their mind on policy issues.

UNIDENTIFIED MALE: This is a shotgun approach. This hits the whole world.

JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: General McMaster could leave his position in the White House as soon as the end of this month.

DAVID AXELROD, CNN SENIOR POLITICAL COMMENTATOR: If you're running people in and out like an NBA basketball game, it's not going to work.

UNIDENTIFIED FEMALE: Does the president want to get rid of his attorney general?

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: Not that I know of.

UNIDENTIFIED FEMALE: (UNINTELLIGIBLE) from Trump?

SANDERS: No.

UNIDENTIFIED FEMALE: Ivanka Trump could be impacted by her own business deal. She could be being impacted by her husband.

UNIDENTIFIED MALE: It raises profound ethics concerns.

(END VIDEOTAPE)

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

CHRIS CUOMO, CNN ANCHOR: All right. Welcome to our viewers in the United States and around the world. This is your NEW DAY. It's Friday, March 2, 6 a.m. here in New York. And here's the starting line.

Trump is once again doing what he does best. He's being provocative and arguably reckless, and it is creating problems that are reverberating around the White House and now the world.

Take a look at the global markets, yesterday sharply down. Look at the futures today, again negative territory. Why? Fears of a trade war. President Trump's sudden announcement that the U.S. is going to impose tariffs on steel and aluminum, despite strong objections by several top advisors. The president defending his position in a new tweet just moments ago. We'll read it to you in a second.

Adding to the policy disarray, the president's positions on gun control may be going the way of immigration, which is to say nowhere. After talking tough on guns in that televised meeting with lawmakers, the president met last night with an NRA executive. That executive took to Twitter to claim that Mr. Trump does not want gun control after all.

CAMEROTA: So confusion over President Trump's policies and the chaos in the West Wing leading to questions about what's next.

CNN has learned that national security adviser H.R. McMaster could be leaving by the end of the month. And now the president's daughter is under FBI scrutiny. CNN exclusively learning that counterintelligence officials are investigating one of Ivanka Trump's international business deals. The federal probe could impact her ability to get a full security clearance.

So let's begin our coverage with CNN's Abby Phillip, live at the White House. Another busy day, Abby.

ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: That's right, Alisyn. Good morning.

The president's hasty announcement of a trade war appears to have been spooking markets. And now this morning, he is doubling down in a tweet.

He wrote, "When a country, USA, is losing many billions of dollars on trade with virtually every country it does business with. Trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country they, and they get cute, don't trade any more. We win. It's easy. It looks very much like the trade war fears are very real, and the president is stoking them this morning."

(BEGIN VIDEOTAPE)

TRUMP: It will be 25 percent for steel. It will be 10 percent for aluminum. But it will be for a long period of time.

PHILLIP (voice-over): President Trump sending shock waves through Washington and around the world, announcing his administration will impose punishing tariffs on steel and aluminum imports, despite strong objections from advisers of his own party.

TRUMP: What's been allowed to go on for decades is disgraceful. It's disgraceful.

PHILLIP: Fears of a trade war ending with the stock market plummeting and uniting Republican lawmakers in opposition.

SEN. BEN SASSE (R), NEBRASKA: This is leftist economic policy. And we've tried it a whole bunch of times over the last two centuries. And every time American families have suffered. It's bad policy.

PHILLIP: A spokesman for House Speaker Paul Ryan urging the president to consider the unintended consequences of this idea and look at other approaches. Senate Finance Chair Orrin Hatch warning that the tariffs are a tax hike the American people don't need and can't afford."

And this "Wall Street Journal" editorial calls the move "the biggest policy blunder of Trump's presidency," adding that "He is taking a machete to America's trade credibility."

President Trump's chief economic adviser, Gary Cohn, lobbied strongly against the move, and multiple outlets are reporting that Cohen is threatening to resign if the tariffs are imposed.

Another bizarre policy twist, the NRA's to be lobbyist, Chris Cox, signals that President Trump may be backing down from his surprising support for gun control just one day after saying this.

TRUMP: Some of you people are petrified of the NRA. You can't be petrified. It doesn't make sense that I have to wait until I'm 21 to get a handgun, but I can get this weapon at 18. I don't know.

Take the guns first. Go through due process second.

PHILLIP: After meeting with the president, Cox tweeted last night that Mr. Trump supports strong due process and does not want gun control. A White House official saying only that the president believes in the Second Amendment when asked about the shift.

President Trump tweeting that the NRA meeting was great.

DANA LOESCH, NRA SPOKESWOMAN: I think he's just entertaining both sides. I think he's listening to hear what both sides have to say.

PHILLIP: The disarray of Trump's policy fueling questions about the president's ability to govern, given the chaos inside the West Wing.

After months of tension with President Trump, an administration official tells CNN that national security adviser H.R. McMaster could be out by the end of this month, joining a growing list of staffers that left the administration.

The White House denies that McMaster's departure is imminent. But there are a number of names already being floated as possible replacements. This as sources tell CNN the FBI is scrutinizing negotiations and financing surrounding the Trump International Hotel and tower in Vancouver.

The president's daughter Ivanka played a key role in getting the deal off the ground. The federal probe could prevent Ivanka from obtaining a full security clearance, something her lawyer refutes.

(END VIDEOTAPE)

[06:05:10] PHILLIP: Alisyn and Chris, it appears the troubles keep mounting for Ivanka Trump and her husband, Jared Kushner. Jared Kushner had his security clearance stripped this week, and ethical questions are mounting about the $500 billion in loans his real-estate company received from businessmen who met with him at the White House.

Meanwhile, President Trump is expected to leave this morning to head to Billy Graham's funeral this afternoon.

CUOMO: All right, Abby, thank you very much.

Let's bring in CNN political analysts John Avlon and Brian Karem.

Brian, good to see you. It's been a while.

All right. So we are doing politics by tweet this morning. And it's important, because it has literally global reverberations and implications. So let's read this tweet again. Abby had it in her piece, but really you need to hear it. All right.

It just came out very, very recently. When a country, us, is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good.

Now, you have never heard a U.S. president say that before, because they listen to their advisers, specifically the economic advisers, who would never say this.

And then he goes on to say, "And easy to win, which we've almost never experienced with one of these. Example: when we're down 100 billion with a certain country and they get cute, don't trade anymore. We win big. It's easy."

OK. Brian, none of this is really accurate in terms of the economists and the advisers who are surrounding the president. Why is he being so impulsive to do something people are asking him not to do?

BRIAN KAREM, CNN POLITICAL ANALYST: Because that's who Donald Trump is. He is as impulsive as he wants to be. And if he has a thought, he tweets it.

And you're right. The big point is there have been advisers, many of whom we see on a daily basis in the White House, that have been giving him advice about what to do and what to tweet, how to tweet, how to conduct himself, and he doesn't listen. Bottom line is, if he wants to tweet it, if he feels it, he does it.

CAMEROTA: Well, what constituency does this one appeal to, since -- let me just quote, read you -- "The Wall Street Journal" has an editorial out today. "Donald Trump made the biggest policy blunder of his presidency Thursday by announcing that next week he'll impose tariffs of 25 percent on imported steel and 10 percent on aluminum. This tax will punish American workers, invite retaliation that will harm U.S. exports, divide his political coalition at home, anger allies abroad, and undermine his tax and regulatory reforms."

Who does it work for?

JOHN AVLON, CNN POLITICAL ANALYST: It works for the protectionist, populist base that Bannon advocated for and Trump really appealed to. This has been a core of his message. Donald Trump has never been a free trader, folks. And "The Wall Street Journal" editorial board, that's not who the constituency's appealing towards.

What's fascinating, though, is he's alienating key economic advisers like Gary Cohn.

This is a continuation of core campaign policies. Forgotten men of western -- men and women of western Pennsylvania and eastern Ohio. We're going to have more protectionist trade policy. We're going to fight for you. You've been screwed over by bad deals in the past. This is a follow-through of a campaign promise. It's just offensive to the consumers who finally have to confront that he's never been on their side in what had been a--

CUOMO: It's certainly not a conservative policy. They're not in favor of these kind of tariffs, traditionally. Look at the markets right now, OK? Here are your futures.

We know the markets were down yesterday. Here they are right now. OK?

Red arrows are bad. We all know that. Now, what's going on here in terms of the metrics of the tariff also is important. Steel, the tariff is going to be less of an impact, because we take in -- we import less of our steel.

Aluminum is really the game here that he's playing on. And the layers of implications distress all the different constituencies. You heard "The Wall Street Journal" say it's going to hurt workers. Why? Well, you may see layoffs, because that's what companies do when their bottom line gets affected. They're either going to pass on the cost. They're going to decide to swallow it, which we almost never see, or they're going to offset it on the -- on the supply side of their own saving.

So the question becomes, what happens next? So he does this. What are all his advisers worried about happening?

KAREM: Well, I think what you should be worried about, what we all should be worried about, is those advisers who are going to flee. And the best and the brightest, I mean, it's becoming increasingly difficult to attract decent help at the White House if you can't get the guy who's in charge to listen to what you're saying and you're the expert in saying it.

CUOMO: Well, why would they leave over this? What do they think is going to happen after this tariff that is unacceptable?

KAREM: Most economists tell you -- will tell you that after -- it may work in a very short run. But when you take a look at the long game a year or two years out, and you're -- what you've talked about is exactly what the problem is going to be. It's going to tank the economy. It's going to increase costs. It's going to hurt the very workers that he claims that he wants to help. And that's the end game.

AVLON: Yes. And you know, look, there are deep divisions inside this White House and in the Republican Party. He has protectionist advisers like Navarro. He's got more free traders like Cohn.

[06:10:00] And the other question is, there's a Pennsylvania special election coming up. And did that, the prospect of that in some way lead him impulsively to make this decision? Sounds crazy, but this is the Trump White House.

CAMEROTA: OK. So let's talk about policy. Because today we were promised, by I think by Sanders, that we were going to get some actual specifics on where the president is on gun policy, right? That the whole country has been so focused on since Parkland.

And so then the president had that sort of open-door, you know, camera session where he got to see us. You know, kind of haggling with both sides. And it was -- I found it really instructive.

KAREM: "The Apprentice."

CAMEROTA: Yes, it was the boardroom. But now it sounds like because of that meeting and that lawmakers were left feeling confused by where the president said, that now it's being pushed back in terms of the policy specifics. And we also know that the president last night met with the NRA. And as we all know, there is a feeling that whoever has the president's ear last is who wins.

AVLON: Right. That is exactly what Ben Sasse said, released in a statement after that meeting. "You know, we're not going to change policy and principles based on who spoke to the president last."

And last night, the NRA sort of called that bluff. And the president all of a sudden sounds like he's back in the fold.

So both sides are constantly in fear that the president's going to flip-flop based on who he last spoke to. And as of, you know, 6 a.m. this morning, apparently, the last person to talk to him is with the NRA. So the bill has 49 votes--

KAREM: And that will change.

AVLON: Exactly right. And therefore, a bill like Cornyn's, which has 49 co-sponsors, is stalled. That's one of the many reasons. Look, that's why you have that qualifier and optimism of cautiously optimistic, right? It was good TV. That's fine. But you know, now, frankly, we've got to, like -- you can't be distracted by the TV quality, because the policy implications often fall short.

This was an exact repeat of what we saw with that DACA meeting, the immigration. Feinstein all giddy: "Oh, he gets it, he gets it. This is great." The Republicans-- AVLON: Was that your Feinstein?

CUOMO: Then she was like, "Why not a clean bill?"

(CROSSTALK)

CUOMO: He gives her the high fold -- he gives her the high fold: "I'd be good with that. And then we'll do the other stuff."

And the Republicans, "Oh, no, no, no. We -- remember what we have to do here. We can't do any of this stuff." And then nothing happens.

Started out that way with guns. But look, it is so offensive to the people who are pushing for this kind of change. Immigration lives on the line. You know this, Brian. You report on it. This here, literally lives lost. These kids coming forward. Him saying he wants to do something. If you wind up with the same impasse, this is a double insult.

KAREM: Well, put it in perspective. Every time -- this is a presidency that pretends it's transparent but is as opaque as it comes. Everything is staged. Everything is for the camera. It looks good, like you said, looks like an episode -- he's actually making progress.

And then you go back to the reality of the situation. We're not getting answers. We're not getting our questions in. We're not finding out real solutions. And at the end of the day, chaos reigns. And man, that hasn't changed in the 400 days of the Trump presidency. It only seems to be accelerating.

CUOMO: Look, chaos is the order of the day, and it's clearly having a toll on White House personnel, too. I mean, there's reports of general exhaustion. Not only, you know, Gary Cohn very upset about this steel deal. But also H.R. McMaster, national security advisor, looking for that--

KAREM: That's over the nuclear arms thing. And that's been going on for wo weeks ago. Two weeks ago, OMB director Mick Mulvaney walked into that briefing room and told us that we were going to spend $50 billion upgrading and enhancing our nuclear policy.

And on the same day, I believe it was, or the day before, the president came out in one of his speeches and said, "Listen, we're going to have the biggest and best nuclear defense system, and we -- they've abandoned what has been a traditional leading role for the U.S. for the last 50 years, abandoning nuclear disarmament. We're not going to lead."

And that is the source for at least some of the friction between McMaster and the president. And the rest of it is, of course, as we're told by those close to the source, that he doesn't want to listen when someone tells him specifically what's going on. And so I'm sorry. But just to finish the point, yesterday you had Anthony Scaramucci on here who said and outlined something that we all know from covering that White House. Morale has never been lower. Like I told Jim before, it's like you

walk into that White House, and it's like somebody stole their dog. I mean, they're walking around with looks on their face. They're overworked, underpaid and can't get anything done. And they can't attract people to get it done. That's the problem.

AVLON: The last -- the first two things, overworked, underpaid is typical for a White House. Can't get anything done is different. And if morale -- the best people are leaving. The people who have the courage to tell the president what's really true and what they need to know when we're heading for the exits, that's not only bad for this presidency. That's bad for the country.

CAMEROTA: All right. Well, here's what the president is thinking about this morning.

AVLON: Oh, yes.

CAMEROTA: Who should play him on "Saturday Night Live." He tweeted this just a few moments ago: "Alex Baldwin" -- which is not exactly his name -- "who's dying" -- not spelled right -- "mediocre career was saved by his impersonation of me on 'SNL' now says playing DJT was agony for him. Alex, it was also agony for those who were forced to watch. You were terrible. Bring back Darrell Hammond, much funnier and a far greater talent."

I think he should resubmit for some spelling errors. But he--

CUOMO: Yes, he deleted it, but by the way, doesn't work. You are president of the United States. They record everything you put out for posterity.

CAMEROTA: He's Alec Baldwin.

AVLON: The president of the United States woke up at 5:42 this morning, and the first thing he's thinking about is critiquing who should play him on "Saturday Night Live" and taking the dickens (ph) out of Alec Baldwin. It's beneath the office, and it shows he really should still be in the role he's happy with. Commenting on the Oscars, being famous for famous sake. Responsibility doesn't seem to suit him.

KAREM: Well, as a newspaper editor, I just want to say blech. Somebody teach the man grammar and spelling. I'm just praying that somebody does.

CUOMO: I'm sure it was just auto correct. The true demon in all grammatical errors.

Look, the problem he has to deal with is, at some point, you have to surrender the "me to the we." I get that the tariffs sound like a good score. Strength. You mess with us, we mess with you. That's not the way economics work on that level.

I get that Alec Baldwin pissed you off. I get it. But you've got to surrender -- well, that offends you. CAMEROTA: That's very offensive.

CUOMO: But when he focuses, on this, we're just going to deal with it lightly and move on. A lot won't. And it winds up disrupting the rest of the agenda.

CAMEROTA: Brian Karem, John Avlon, thank you.

The upheaval in the West Wing, President Trump's national security adviser, as we've been saying, may be the next one out. There is reporting behind that. Can the president stop this revolving door? We take a look at that next.

(COMMERCIAL BREAK)

[06:20:28] CAMEROTA: All right. So chaos continues to rock the West Wing. CNN is reporting that National Security Advisor H.R. McMaster may be out by the end of the month.

Let's bring back John Avlon and Brian Karem.

So I remember when H.R. McMaster's name first came into the fore, and it sounded like people on both sides were excited about this. You know, he was somebody who everybody admired. He had a great reputation. And so if he's out, who replaces him? What do we think happens next, John?

AVLON: Names are being floated, including John Bolton, which has a lot of folks very nervous. Extreme sort of far-right hawk. A name has been floated, floated, Safra Katz (ph), the Oracle who's been close to the administration. Evident national security policy, per se.

But look, this is a real loss, potentially, for the West Wing. McMaster is someone who is widely admired, who had the cajones to tell the president what he needed to hear, whether he wanted it or not. And he's been working fairly well on most accounts with Kelly.

KAREM: He's very professional. I've known him since the Gulf War. The first time I ran into him was during a tank battle.

The guy was just straight up one of the nicest, most professional guys I've ever run across. And when he conducts a briefing in the White House, it's straight. It's to the point.

When he's talking to you, he's on point. He's not spinning. And the guy, as you said, you know, has had the reputation of going straight to the president and telling him exactly what he needs to hear, not necessarily what he wants to hear.

But what he needs to hear--

CUOMO: We saw the same thing. When we interviewed him here, when he waves you off something, he tells you why I'm waving you off. He doesn't just not answer. He doesn't say, well, that's a bad question or "you're fake news." He doesn't play any of that -- he stays straight.

But even if you don't agree with anything that was just said, the timing here is terrible. Hopefully, the president was telling the truth yesterday when he said this is fake news, this NBC report about him leaving, being before NBC had sourced it.

KAREM: Well, we have heard it before.

CUOMO: Right. No question. But he then looked at McMaster and said, "You're doing a great job. Doing a great job." Hopefully, that's truish. Because--

KAREM: Define "truish."

CUOMO: Well, you've got the administration bubbling up about whether or not you should do something military against North Korea in a preemptive fashion. You've got Putin basically for an audience of one looking at Donald Trump and saying, "I'm the big dog. I'm the big dog." So you need a sober mind right now.

KAREM: More than ever.

AVLON: And just -- you know, he is a thoughtful man. He is somebody who has tried really -- even when he disagrees with the president, he's trying to be loyal. But he's been really keeping the Constitution in mind. And has strong national security experience, in conjunction with Mattis and the Sec Def. So it's going to be his chief of staff. So it's going to be a real problem. If someone new comes in at a time of maximum peril, that's going to be problematic for the country. Not just--

KAREM: You know, we look at Hope Hicks leaving and we look at the turnover.

CAMEROTA: Let's pull it up. Because we actually have a graphic to remind everybody of the important people in the White House who have left. So look at the White House departures. I mean, you can just take -- starting with Mike Flynn. OK?

So Mike Flynn, you forget some of these people, how important they had been. Sean Spicer, Reince Priebus, Anthony Scaramucci, Steve Bannon. I mean, it just goes all the way down there to Hope Hicks. And Omarosa is also featured.

KAREM: We still don't know what she did there, but--

CAMEROTA: But this is, to your point, Brian, this is not politics. But this is a larger set of--

KAREM: In this particular case, the McMaster, if McMaster does leave, and like I said, you know, I take that with a grain of salt, because we've heard that before. And there has been contention between him and the president. But I'd like to think that he stays, just because I -- having known the man, I respect him deeply. But that guy leaving is not just -- it's not a problem on the Hope Hicks scale. This is a problem on a global scale. Particularly when you do have the problems with Russia, but you know what I mean, you do have the problems with North Korea and, don't forget, Syria. I mean, we've been pressing that question and that--

CUOMO: And Russia.

KAREM: Russia. And that has been pushed in the press briefing for the last month. Without any acceptable or any answers at all. So if he leaves, that is a huge hold.

AVLON: That's right. And this isn't an assessment of how the administration is doing about. We all have an interest in the key apparatus being run by professionals. Mattis is a professional.

Right now, the cost of Captain Chaos and control is something like 34 percent of high-level appointments gone in the first year.

CUOMO: Now, they'll say this is insider concern. This is what he does. He likes people in and out. But it is having an impact on people. We have poll numbers that show where people's relative sense of concern is about things. Let's put up some of it.

CAMEROTA: Well, here's the "has Trump done a good job choosing top advisers"?

CUOMO: I think this is a generous number, by the way, that he has 35 percent positive. I don't know who people are liking right now, outside of the general.

[06:25:13] CAMEROTA: Well, I mean, 35 percent is his base, right? So are you concerned about employees working there without security clearance? Obviously, this came up with Jared and now Ivanka, as well. Yes, 70 percent of respondents say, yes, they are concerned. That leads us to Ivanka.

So here's the new reporting. Ivanka is being scrutinized for the FBI for one of her international business deals, Trump Hotel, in Vancouver. We're not sure what's wrong or why they're scrutinizing this. But that is what is preventing her from having a full security clearance, we're told.

First of all, it's been more than a year. I didn't know she didn't have a full security clearance, because she's one of the president's top advisors. But she and Jared now both don't. So what does this mean?

KAREM: Actually, I've got news for you. It might be nothing. The president of the United States, certainly it is within his purview to hand to Ivanka and to Jared his daily briefing if he so desires. So while it may be nice and may give us a comfort level if they have those security clearances, at the end of the day, it may absolutely mean absolutely nothing to the operation of the White House. And that's the frightening part. That's why you have nepotism laws.

They all throw up Robert Kennedy and John Kennedy. But, I -- you know, Robert Kennedy and Jared, not really. CUOMO: Well, look, the problem with family with the Kennedys was

that, you know, they'd have each other's backs, and they would echo each other's politics no matter what.

KAREM: Right.

CUOMO: You're not talking about what external considerations these people may be balancing.

AVLON: That's right.

CUOMO: The idea like, Scaramucci was arguing yesterday, "We've never seen sophisticated people like this before. It's usually very easy. They just hold stock in a company. You can put it in a trust. And then they're fine, they're clean."

One, that's an over-simplification. But also it's about what your priority is. If she's cutting deals for herself while she's also working with America, you're going to have a problem. Her husband is in the same boat.

CAMEROTA: For sure. I mean, that's what we had heard with Jared yesterday.

All right. We will continue to follow this, obviously. Brian, thank you.

John Avlon, thank you.

OK. So we have to tell you about this major storm is targeting the northeast. Residents along parts of the New England coast are urged to evacuate. So we're tracking this powerful nor'easter. We'll tell you what's next.