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China Retaliates Against U.S. Tariffs. Aired 7-7:30a ET

Aired April 02, 2018 - 07:00   ET

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

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: I don't think we've ever had a better relationship with China. The only thing that can get in its way is trade.

[07:00:08] ALISYN CAMEROTA, CNN ANCHOR: China retaliating against the U.S., announcing new tariffs on American goods.

UNIDENTIFIED MALE: Our shared objective is to reduce the trade deficit. We're not afraid of a trade war.

UNIDENTIFIED MALE: The idea that people are coming here to take advantage for DACA is completely wrong.

TRUMP: They had a great chance. The Democrats blew it.

UNIDENTIFIED MALE: This is how Trump negotiates. This could be him trying to push things along.

JAKE TAPPER, CNN ANCHOR: So you were fired?

DAVID SHULKIN, FORMER SECRETARY OF VETERANS AFFAIRS: I did not resign.

JIM SCIUTTO, CNN CORRESPONDENT/ANCHOR: The White House pushing back, insisting the outgoing V.A. secretary stepped down.

UNIDENTIFIED MALE: It just adds more confusion. The guy didn't leave of his own accord. He was canned. That's what the Donald does.

(END VIDEOTAPE)

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

CAMEROTA: Good morning, everyone. Welcome to your NEW DAY. Chris is off. And I have Jim Sciutto and John Avlon joining me.

SCIUTTO: Real pleasure to be here.

CAMEROTA: What a fun hour we've had. OK. Let's continue.

China makes good on its promise to strike back, the Chinese government slapping tariffs on $3 billion worth of U.S. exports in response to President Trump's penalties on imported steel and aluminum. The retaliatory move heightening fears of a trade war. SCIUTTO: Meantime, President Trump declaring there will be no deal

for DREAMers and threatening to pull out of NAFTA unless Mexico does more to protect the border.

This morning, CNN has new reporting about what is fueling the president's hard line on immigration. All this as the former Veterans Affairs secretary, David Shulkin, tells CNN that he was fired while the White House still insists he resigned, setting up a fight over his successor. The former cabinet member is going to join us live in just moments.

We have it all covered. Let's begin with CNN's Ivan Watson. He is live in Beijing with our top story.

IVAN WATSON, CNN CORRESPONDENT: Hi there, Jim.

China has retaliated for the Trump administration's tariffs that were imposed on imports of steel and aluminum last month. The Chinese finance ministry said that that seriously damaged Chinese interests. So it has singled out about 128 different U.S. imports to China and slapped sanctions on them -- tariffs, rather.

Fifteen percent on items such as fruits, nuts, wine, and steel pipes. Twenty-five percent on pork and recycled aluminum. This amounts to about $3 billion worth of U.S. goods coming to China. That's a drop in the bucket when you compare it to overall trade between the two countries, which is close to $650 billion. But if you're a pork producer, if you're a hog farmer in the U.S. right now, this may be very worrisome.

Because the National Pork Producers Council, it says that China is the U.S.'s third largest market for pork exports. It's a $1.1 billion industry. And somebody who may have a container full of pork chops in a Chinese port, they just lost pretty much 25 percent of their value. The Trump administration has threatened additional 50 billion to $60 billion worth of goods, tariffs coming from China for intellectual property theft. If that happens, this first skirmish in trade conflict could turn into an all-out war -- Jim and Alisyn.

CAMEROTA: OK, Ivan. Thank you very much for all of that reporting. So President Trump vowed over the weekend that there will be no deal on DREAMers. He also threatened to exit NAFTA in a series of tweets. What prompted all of this? CNN's Kaitlan Collins is live at the White House with more.

What have you learned, Kaitlan?

KAITLAN COLLINS, CNN CORRESPONDENT: Well, Alisyn, it had been a few days of relative silence from the president. But after he spent the weekend down in Palm Beach, Florida, with a series of FOX News hosts and allies, he went on a rant yesterday on Twitter, essentially declaring that there would be no deal for DACA to get legal status for those undocumented immigrants, and he also threatened to pull out of NAFTA if Mexico doesn't start doing more for border security.

(BEGIN VIDEOTAPE) COLLINS (voice-over): President Trump spending the Easter holiday weekend venting about immigration. In a series of combative tweets, the president saying he wouldn't make a deal for DREAMers, claiming the undocumented immigrants are pouring into the U.S. because they want in on the act.

TRUMP: A lot of people are coming in because they want to take advantage of DACA. And we're going to have to really see.

COLLINS: The president seemingly confused about the parameters of the DREAMer program. It protects undocumented immigrants from deportation if they were brought to the U.S. as children, but it only applies to those who have lived in the U.S. since 2007. Meaning that no one crossing the border now would be eligible.

TRUMP: They had a great chance. The Democrats blew it.

COLLINS: President Trump also blaming Democrats for failing to broker a deal to protect DREAMers, despite the fact that it was Mr. Trump's decision to end the Obama-era program in the first place.

Mr. Trump's tough talk in stark contrast to these earlier promises.

TRUMP: Very, very tough subject. We're going to deal with DACA with heart.

[07:05:04] This should be a bipartisan Bill. It should be a Bill of love. Truly, it should be a Bill of love. And we can do that.

COLLINS: The president's outburst prompting criticism from members of both parties, including Ohio Governor John Kasich, who tweeted, "A true leader preserves and offers hope, doesn't take hope from innocent children who call America home."

The president also lashing out at Mexico, threatening to pull out of NAFTA if Mexico doesn't curtail the flow of undocumented immigrants.

TRUMP: Mexico has got to help us at the border. They flow right through Mexico; they send them to the United States. Can't happen that way anymore.

COLLINS: Mr. Trump using that argument to again stress the need for his border wall. Sources tell CNN that the president's tweet storm came after he had conversations with a number of allies associated with FOX News over the weekend, who told him that his base believes he's softening on immigration. Multiple people pointing to hardliner Ann Coulter's recent media tour, calling Trump a disappointment.

All this as the Trump administration continues to insist that ousted Veterans Affairs secretary David Shulkin resigned rather than being fired. Shulkin denying this claim, saying he never submitted a resignation letter.

SHULKIN: I would not resign, because I'm committed to making sure this job was seen through to the very end.

JAKE TAPPER, CNN ANCHOR: So you were fired?

SHULKIN: I did not resign.

(END VIDEOTAPE)

COLLINS: So David Shulkin has been on quite the media tour since he was resigned or was fired, depending on which account you take. It will be on CNN in the next hour.

And speaking of media tours, the president is continuing to tweet, is following up on his tweet storm yesterday, Jim, Alisyn and John, saying, quote, "Mexico has the absolute power to let these large caravans of people enter their country. They must stop them at their northern border, which they can do because their border laws work, not allow them to pass through into our country, which has no effective border laws.

So we're seeing there he's continuing to tweet about this. It's unclear if these tweets actually represent a change in policy for this president or they're just simply him venting after watching cable news.

CAMEROTA: OK. We'll talk about that.

SCIUTTO: Does that happen? Does that happen?

CAMEROTA: Thank you very much. Here to break down all this, we have CNN political analyst Margaret Talev and CNN chief legal analyst Jeffrey Toobin.

So Jeffrey, he says we -- Mexico has effective border laws but we don't? We have no effective border laws, the president just said?

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: You know, he's also said that his administration is a huge success at cutting illegal immigration. So you know -- you know, I think it's a mistake to parse these tweets too carefully for logic and factual accuracy. But they are good windows into what he's actually thinking. And he is worried that his base thinks that he is getting soft on immigration.

CAMEROTA: Right. We heard that from Ann Coulter.

TOOBIN: Right. This stuff that takes a harder line.

CAMEROTA: OK. Before you guys all talk about it, we do now know the genesis of this change in his policy. And it was a "FOX and Friends" weekend segment.

The president loves watching "FOX and Friends," as we know. My friends over at the weekend show, Griff Jenkins was on. Abby Huntsman was on. Pete Hegseth was on. And they were opining on this story of a caravan with a reporter in it trying to get from, I think, Honduras to the U.S. border.

So here is what the president watched. Listen to this moment.

(BEGIN VIDEO CLIP)

PETE HEGSETH, FOX NEWS: An army of migrants is literally marching or riding or making their way from -- is it from Honduras?

ABBY HUNTSMAN, FOX NEWS: Most all of them from Central America. The big question is what happens when they do arrive in the U.S.? I know they want to seek protection. But they won't -- they won't necessarily get that?

GRIFF JENKINS, FOX NEWS: No. They're going to be arrested. I mean, you can't illegally come to the United States.

HUNTSMAN: Will they, though? I don't know.

HEGSETH: What do you think. If there's a small migrant army marching toward the United States peacefully but wants to cross our borders, how should it be handled?

(END VIDEO CLIP)

TOOBIN: What a good question for the FOX audience.

SCIUTTO: A migrant army. Listen to that phrasing. This is an army. It speaks to an invasion of brown people, right, from Central America. This is the implication. And you do have a direct kind of pipeline from that broadcast with the president.

CAMEROTA: The president tweeted shortly after that. But listen, that's a talking point on "FOX and Friends Weekend." We used to do these all the time. That's what the show is. You talk about the news. You don't report the news. You talk about the news, and you sort of opine on it.

But when -- when I was in the show, President Obama wasn't forming policy, I don't think, based on my blatherings. But -- but, Margaret, this -- this -- there is a direct link from that airing to then the president's tweet.

MARGARET TALEV, CNN POLITICAL ANALYST: Well, and the president knows that there's a key component of his base that also watches the same programming and may -- may want him to respond to that also.

You know, look, it is not exactly clear whether this was sort of weekend Twitter, and then we'll shift back to weekday policy or whether this is a potential shift. Up until now, we've been hearing pretty consistently that they think they're going to be able to work this out on NAFTA, and that the president has been committed to taking care of the DACA children at some point, although just how wasn't clear. That March date passed, and here we are now.

[07:10:14] I'll say this. At 2 p.m. this afternoon on his public schedule is a meeting with the new National Economic Council leader Larry Kudlow there to replace Gary Cohn. And Larry Kudlow's input could be really important on a couple of fronts. Both dealing with how the U.S. and Mexico deal with one another economically and about China policy. TOOBIN: But let's just talk about DACA for one more minute and point out that there are 800,000 people whose lives and fate are in jeopardy here. And you know, we talk about them as if they are just a political issue. They are actual human beings who have lived vast -- the vast majority of their lives in the United States. And -- and, you know, the president keeps making up stuff about them, you know, acting as if he's the one who wanted to protect them when, in fact, it's been the Republicans who have rejected every attempt to protect their faith. You know.

JOHN AVLON, CNN POLITICAL ANALYST: What we are seeing from that clip, though, that I think is significant is the moment of inception. When Pete Hegseth says, you know, "What do you think?" he might as well say, "What do you think, Mr. President?"

Because he's going to get a response in close to real time. The president tweeting this morning about this, apparently in reaction to another, you know, segment on that station. And so it does end up dehumanizing the people we're talking about, the human beings. Because it's at the level of a sound bite designed to create fear among a certain element.

SCIUTTO: And it's a pure political calculation. Kaitlan Collins reporting this morning that the president does feel, as you were referencing, Jeffrey, that his base is worried he's softening on immigration. And therefore, he's -- you know, he's sending a message directly to the base with this.

CAMEROTA: I mean, Ann Coulter. We saw the reporting this weekend. That she said without a wall that she's a former Trumper. That that's the deal breaker for her.

Here's -- this is another tweet?

SCIUTTO: Yes, it is. Because there's a dot, dot, dot. It's a continuation of the one earlier. But the president continuing: "Congress must immediately pass border legislation, use nuclear option if necessary, to stop the massive inflow of drugs and Border Patrol agents and ICE are great but the weak Dem laws don't allow them to do their job. Act now, Congress. Our country is being stolen."

I mean, there's a factual issue here in that, actually, immigration across that border is down dramatically over the last -- in the last year. But the president's political point is clear.

AVLON: Yes. He's invoking the nuclear option, and he's talking about how the country's borders are being stolen, apparently, under his watch. But the real tragedy is the president has the capital to pull a Nixon in China on this issue if he wanted to.

You know, there were outlines of a grand bargain that could preserve the DREAMers, which in the past he said he's wanted to do, and increase border security, which clearly is a priority for him. But the president seemed to rather grandstand on the issue than govern. And that's a loss for the country as well as for his political base. TOOBIN: There hasn't been a single time in the Trump presidency when

he has done a Nixon to China. When he has done anything, any policy except that that pleases his base. I mean, that's -- that's the bet he's placing on his presidency of being a very hard line conservative and keeping his base happy. But, you know, we'll see how that works out in the midterms and in his real life.

TALEV: But it's quite a doubling down barreling towards the November midterm elections. If you start invoking the nuclear option on legislation and then your chamber terms.

TOOBIN: But just for people who don't know the lingo, the nuclear option means ending filibusters in the Senate. Meaning that the Senate would operate by majority role, instead of requiring --

CAMEROTA: On policy and legislation not just judges.

TOOBIN: And not just nominations. But there's no one in the Senate who wants that. I mean, Mitch McConnell doesn't want that. So the idea that, you know, the nuclear option is going to happen is just a fantasy.

AVLON: And if Democrats take control of the Senate in the midterms, a big "if." I'm going to guess he's going to be singing a very different tune about the nuclear option.

CAMEROTA: Very quickly, Margaret. Here's who had the president's ear over the weekend. We know that the president is often, you know, influenced by whomever he has just had dinner with. So here's who his weekend guests were. Jeanine Pirro from FOX; Sean Hannity from FOX; Bill Shine, formerly of FOX; Don King; Bernie Kerik; and My Pillow guy, Mike Lindell. That's -- Margaret, what are we to make of that cast?

TALEV: If the My Pillow guy is helping the president get a good night's sleep, I think that's good for all of America.

TOOBIN: And he is a CNN advertiser, even though he doesn't appear on CNN.

TALEV: They're good pillows, too. I have one.

TOOBIN: That's good.

AVLON: Wow, really?

TOOBIN: I'm not familiar with his work.

AVLON: Three FOX News execs, two ex-cons and a pillow salesman will be the best off-Broadway play of 2019.

TALEV: I'd watch that for sure.

CAMEROTA: Thank you all.

[07:15:03] AVLON: Brain trust. President Trump's inner circle shrinking. So who has the president's ear now? We're going to ask a former Trump campaign adviser, Michael Caputo. That's next.

(COMMERCIAL BREAK)

SCIUTTO: Welcome back. The breaking news. This just into CNN. And President Trump tweeting now that DACA is dead, quote unquote. Here's that tweet. "DACA is dead because the Democrats didn't care or act, and now everyone wants to get onto the DACA band wagon. No longer works. Must build wall and secure our borders with proper legislation. Democrats want no borders. Hence drugs and crime!" exclamation point.

Joining us now is Michael Caputo. Michael, thanks very much for taking the time. First on that tweet from the president. Should we take the president at his word here that he has done negotiating on a DAC deal?

MICHAEL CAPUTO, FORMER YELTSIN ADVISOR, THE KREMLIN: I don't think the president, at least President Trump has ever really done negotiating until a deal is done. But I think the president shows in this tweet and some of the other things he's tweeted and said in the recent days that he's tired of the Democrats gaming on DACA. He wanted to make a deal. He talked about doing something that everyone could be happy with. And the Democrats would not give on any of the other items he wanted as part of that deal, as if they were in the majority.

[07:20:14] SCIUTTO: Wait. Let me ask you here.

CAPUTO: -- quite tired of it.

SCIUTTO: How do you back up that argument that this is all about the Democrats here? There have been -- there have been proposals going back and forth from both parties here. How does he -- how does he get away with putting this all on the Democrats' shoulders?

CAPUTO: Well, I don't think he puts it all on the Democrats' shoulders.

SCIUTTO: He did just there.

CAPUTO: In this tweet he does. But this is something that lies on the desks of Congress. I think the Democrats in Congress have made sure that that deal is -- you know, isn't something the president would want to sign.

I think they've also rejected some of the items that he insisted on having in there. The president -- you know, he controls the White House. The Republicans have the Senate and the House. The Democrats are acting as if they're in control. They're not. And I think, you know, the president is trying to get them to the table for the final time.

SCIUTTO: If I had asked you -- and I know John Avlon, who's with me here and wants to pipe in. But is this all about money for the wall? I know that the president was disappointed and the budget bill passed just last week. There was not the money he wanted. And let's keep in mind, Republican majorities in both houses of Congress. It doesn't show a great amount of urgency on the part of Republicans for that money. But is that really what the president is looking for here? You said the president is not done negotiating. Would he be satisfied if he suddenly got money for his wall?

CAPUTO: The president wants to secure the border, as well as the just American immigration policy, including DACA. And the president believes as well as people who are allies to him, that without a secure border, in this case, in the president's view, the wall, that fixing immigration is impossible. The Democrats disagree with that. And we're at loggerheads because of it.

AVLON: But Michael, John Avlon here. I mean, Democrats have been offering more money for border security. You acknowledge that, correct?

CAPUTO: Yes, sir, I do.

AVLON: OK, and also, we are a long way from the bill of love that the president promised. You admit that, right?

CAPUTO: Certainly, I admit that. But at the same time, we're nowhere near the bill that the president wants. The Democrats are in the minority. They have enough Republicans that are against the president to stymie what he wants to do and so this is --

AVLON: When the president tweets, as he did this morning, that the Democrats want no borders, that's just factually false. You concede that, right?

CAPUTO: I can see what the president's rhetorical point is there. I said I believe -- I see what the president's rhetorical point is there. In comparison to people -- Donald Trump and the people who agree with him, the Democrats in comparison do not want a strong border. The president believes that's a down side and that he's insisting on something a lot more strong than the Democrats --

SCIUTTO: The president is not claiming a rhetorical point. He's claiming this as a factual point. Let me ask you, if I can, Michael --

CAPUTO: When do Democrats make rhetorical points?

SCIUTTO: I will grant you that -- I will grant you that politicians make rhetorical points. But I want to get to the president's position on this. Because that's what's key here for the president to -- you know, people talk about doubts about the president's word. The president's position, based on his own public statements, has changed enormously over the past several weeks and months.

I know you may be aware of that. But for the sake of our viewers, let's have a listen.

(BEGIN VIDEO CLIP)

TRUMP: I will immediately terminate President Obama's illegal executive order on immigration. Immediately.

It's a very, very tough subject. We're going to deal with DACA with heart.

It should be a bipartisan bill. It should be a bill of love. Truly should be a bill of love. And we can do that.

(END VIDEO CLIP)

SCIUTTO: What is the president's actual position on DACA? Explain it in one sentence.

CAPUTO: I believe the president wants to create a final solution for the people who are under the DACA ruling. I think that he wants a solution that, as he said, is one of love. I believe he wants DACA -- recipients of DACA classified people to stay in the country. And I believe he would do that if the Democrats would come around.

I mean, what you heard in the first part of these -- these clips were campaign rhetoric, something that he was saying as he was -- as he was barnstorming America. Where the president is now is he believed that this program would be overturned in the courts. So he canceled it and said, "Let's get together and fix this thing for good." And yet we haven't been able to do it.

SCIUTTO: He came up with the phrase "bill of love." I'm trying to figure out. That's his own -- that's his own rhetorical position on this. Why the evolution away from that public offer?

CAPUTO: Because the Democrats, in his mind, and I think in mine, as well, have been playing politics with DACA all the way along. They're not giving the president -- conceding the point to the president wants. He controls the White House and the administration.

[07:25:08] The Republicans control the Senate and the House. The Democrats are acting as if this is their time. It's not. They have to compromise to get a solution for DACA.

SCIUTTO: Well, is it not -- the point John Avlon made, the Democrats have offered more money on the wall. Is that not a compromise? I just wonder if, at the end of the day here, this is more about the president taking the message from the Ann Coulters of the world. His base.

Fears he's getting soft on immigration. And here he is now saying, "He said DACA is dead." I mean, those are his words via Twitter just moments ago. I wonder if this is less about political negotiation and more about the president, more worried about his base, going into the midterms and 2020.

CAPUTO: I don't believe the president is concerned about his base on this issue. I don't think the president thinks that Ann Coulter represents his base. Ann Coulter has never really, you know, moved the president in one direction or the other.

SCIUTTO: Why did he spend the weekend, then -- he spent the weekend with Sean Hannity, who else was down there, Jeanine Pirro? Why did he spend the weekend, then, with folks who were telling him this very message. That's who he spent his time over the holiday weekend with.

CAPUTO: I understand. I'm kind of palms up about why people are worried about the fact that the president chooses to make friends with people from FOX instead of people from CNN. I mean, if you're worried about his dinner partners, I don't really know --

SCIUTTO: How about folks outside the television news business? I don't know. Lawmakers --

CAPUTO: I don't know. The president comes from the television news business. This is where -- this is where he comes from. He also has dinner with developers. This is the president we have. He's not a politician. He's not going to dine with people from the Republican or Democratic Party. That's just not the president we have. And I think you know that.

SCIUTTO: Well, it does look like that's the team. Certainly, the team of advisers in his White House. Michael --

CAPUTO: Listen, I'll tell you. I understand. But you know, look, television news tends to find people who are experts in their field and has them on as commentators and then even hosts. That's where Larry Kudlow comes from.

Larry Kudlow is not a television commentator as much as as an economic adviser. I remember him standing in the room with me and Jack Kemp. That's the same thing with Jim Bolton. He's a commentator on FOX News, but he's a man with years and years of experience on the national security apparatus. If you want to call them TV commentators, I think you're summarizing their resumes incorrectly.

SCIUTTO: So you're saying Sean Hannity, in this case, who spends a lot of time with, you know, he speaks with regularly, he's an expert on these issues?

CAPUTO: Of course I'm not saying that. I'm saying Sean Hannity is his friend. Sean Hannity is a commentator. He is someone from radio and television. But you can't paint them all with the same broad brush just because they come from the rival network.

SCIUTTO: It's not about the rival basketball. We're looking at what kinds of experts, what kinds of points of view that the president is tolerating. The thing is, our own Kaitlan Collins is reporting this morning that inside his own cabinet, regardless of who he meets with on the weekend, he is surrounding himself with more agreeable folks. More -- closer with the program, as it were.

CAPUTO: I certainly hope so. I certainly hope so. The president deserves to have the cabinet and a White House full of advisers that he wants. Every president deserves that. The fact that we see Mike Pompeo and Ambassador John Bolton, and Larry Kudlow. And coming into the positions they're into, shows the president is assembling a team that he desires. And I've got to tell you --

SCIUTTO: I get the point, Michael.

CAPUTO: The fact that you're on TV disqualifies you from advising a president either.

SCIUTTO: If he'd take my calls, I would call him back.

SCIUTTO: Michael Caputo, thank you very much. Thanks for taking the tough questions, as always.

CAMEROTA: Go ahead.

SCIUTTO: Here's what's fundamentally wrong, I think, about the point that Michael is making. It's not that the president shouldn't surround himself with the people that he likes and enjoys spending time with. It's not even that it's people who seems to just inflame his worst instincts and not challenge him.

It's that our best presidents, our most competent presidents, our most competent presidents surround themselves with a team of rivals. This was true going back to George Washington. It was true famously during Lincoln where the book by Doris Kearns Goodwin coined the phrase. And so when you insist on a degree of conformity. And also people who are not actually issue experts being the last people on your ear on the policies that affect people, those two things are real problems.

CAMEROTA: Yes, I mean, not only that, you know, I want to correct one thing that Michael Caputo said. He said the president comes from the world of TV news. "The Apprentice" is not TV news. It's TV. It's not TV news. That's not right.

AVLON: And the other thing is, listen, every president has a right -- and President Obama did this over time during his administration. You got folks around him who agree with him. But the thing is, can you tolerate disagreement?

SCIUTTO: That's right. And this is something that seems to be a death nell for any advisors who disagrees with this president.

AVLON: Presidents need to hear things from people who disagree. That's how they make up their own mind. Trying to do what's best for the country.

CAMEROTA: We will talk about that coming up. Because we have the ousted V.A. Secretary David Shulkin. He says he was fired for his views. So what does David Shulkin think the future of the V.A. is? He's next.

(COMMERCIAL BREAK)