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Tsunami Observed Off Japanese Coast; Interview with Rep. Sean Duffy; New Conflict of Interest Concerns for Trump Business; Trump Working '18-Hour Days' to Build Team; Biden's Name Floated for Democratic Party Chairman; Bannon Comments Stoke Political Firestorm. Aired 5-6a ET

Aired November 21, 2016 - 17:00   ET

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

[17:00:00] WOLF BLITZER, CNN ANCHOR: Happening now, breaking news. Tsunami warning. A major earthquake off Japan triggers fears of a tsunami and orders to evacuate immediately. It includes an area where a wall of water destroyed a nuclear plant just five years ago.

Direct appeal. We're standing by for the president-elect to put out a video aimed at the American public, outlining his to-do list on trade, national security and ethics. That comes as Donald Trump interviews would-be members of his administration to carry out that list, including loyalists, Republican critics and even Democrats.

Conflicts of interest. Can President-elect Trump disentangle himself from his global business empire? There are growing concerns about undue influence and a possible violation of the Constitution.

And victory chant. White nationalists using a Nazi salute to hail Donald Trump's election victory. Will the president-elect find a way to wiggle out of their embrace?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: Our breaking news. Immediate evacuations are being urged on Japan's east coast, and a tsunami warning is in effect after a major earthquake struck offshore. Japan's meteorological agency says a tsunami wave of up to 10 feet is possible. Fukushima district is the same area devastated five years ago by a tsunami which destroyed a nuclear plant.

Also, the Trump transition is starting to resemble the president- elect's old TV show "The Apprentice" as would-be nominees try out for cabinet posts. The contestants include Trump loyalists, fierce critics like Mitt Romney, and today Congresswoman Tulsi Gabbard, a Democrat, who says she talked Syria with Donald Trump and who may be in line for a United Nations ambassadorship.

But it's another old show, "Let's Make A Deal," that comes to mind amid growing concerns that Trump's global business operations could lead to conflicts of interest at home and abroad, especially after the president-elect's recent meeting with businessmen tied to a Trump- branded property in India. Could Trump already be violating the U.S. Constitution?

And a man already picked by Trump to be his chief White House strategist is strongly denying claims he's an anti-Semite and a white nationalist. Steve Bannon headed Breitbart News which has been a platform for some fringe groups on the so-called alt-right. And now some latest comments that set off a new wave of criticism.

I'll speak with the Republican congressman Sean Duffy. And our correspondents, analysts and guests, they'll have full coverage of the day's top stories.

Let's start with the breaking news. Let's go to Will Ripley. He's monitoring the tsunami warning after that magnitude 6.9 earthquake off of Japan. What are you hearing, Will? What's the latest?

WILL RIPLEY, CNN CORRESPONDENT: Hi, Wolf. Japan's national broadcaster, NHK said the tsunami wave that was observed off the coast has reached Fukushima. And I'm looking at their live feed right now. In my three years in Japan, this is the first time I've seen a red banner across the top of the screen, telling everybody along the coast to evacuate immediately.

So this is a very serious situation, especially for people in Fukushima prefecture which was devastated, along with many areas along the east coast of Japan, just five years ago back in 2011 when that 9.0 earthquake triggered 30-foot tsunami waves that destroyed hundreds of billions of dollars in property and killed 22,000 people. They also caused the deconstruction of the Fukushima-Daiichi nuclear plant, the meltdown that that area is still crippled by and recovering from.

I've spent a lot of time there in that coastal area, and my only hope as I watch these live pictures, is that this particular tsunami is said to be about 10 feet high, so a third of the size of the waves that would have hit back in 2011, that it will not overcome the sea walls that have been constructed. And there's a major seawall construction project along Japan's eastern coast to try to prevent the damage that Japan saw in 2011.

But that construction is still underway. Some of those seawalls have not been finished yet. Colleagues of mine who were on the ground say they felt shaking for about three minutes just before 6 a.m. Tokyo time. It's a time when people -- a lot of people are probably up and getting ready for work. Many Japanese have very long commutes. They're up at 5, 6 a.m. in the morning.

And so hopefully most people in the immediate danger zone got this warning and were able to get out of their homes and move to higher ground safely. It doesn't appear from the footage that I'm looking at, the live feed from NHK, that this tsunami wave is overtaking any seawalls or anything close to the kind of destruction we saw back in 2011.

But this was a strong quake this time around, it was a shallow quake, so there is a risk, and there will be for quite some time for these waves to come crashing ashore. Which is why Japan is taking -- taking every possible precaution to try to doing everything they can to get people alerted and evacuated.

BLITZER: And the tsunami -- I just want to remind our viewers -- it has now been observed. Let's hope those seawalls hold that. Will Ripley, we'll get back to you.

I want to check back in with our meteorologist, Jennifer Gray. What are the forecasters saying, Jennifer?

JENNIFER GRAY, CNN METEOROLOGIST: Well, we've already had a 5.4 after shock, and we'll have more aftershocks in the next few hours and even days.

But of course, that 6.9 earthquake about 30 miles just offshore. The strongest shaking, of course, occurred offshore, but that is also what's triggering that tsunami. And so we do have the observation that the tsunami is in progress, should be reaching the shore very, very soon, if not already.

And so we could see waves anywhere from 3 to 10 feet. And we could also see more than one, and that's important. That's why people are urged to get to higher ground, and they're urged to stay there until that warning is lifted.

Of course, the shaking also a big concern here, with the possible damage, especially right along the coast, and you can see those areas of yellow. Those are the people that felt very strong shaking. And we -- early estimates think it's about 305,000 people right along the coast. And then these shades of green. Those are the areas that felt light to moderate shaking.

Of course, the imminent threat right now being the threat of a tsunami and maybe even more than one wave, and then these aftershocks, of course, Wolf, as we go forward in time.

BLITZER: All right. Let's hope those seawalls hold, indeed. We'll check back with you, Jennifer, as well.

Let's get to the other stop story we're following right now. The Trump transition. Our senior White House, Jim Acosta, is in New York for us.

Jim, it looks like Donald Trump is doing his old, "You're hired, you're fired" routine with some of these would-be nominees, appointees. What's the latest?

JIM ACOSTA. CNN CHIEF WHITE HOUSE CORRESPONDENT: It sure looks like it, Wolf. But Donald Trump appears to be approaching some decisions on key cabinet positions for his new administration. And as we've observed through the selection process, he has not lost his flair for the dramatic.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): Welcome to the latest episode of "Presidential Apprentice." Donald Trump's cabinet candidates look almost like contestants, parading past the cameras for a chance to be a part of the new administration.

SCOTT BROWN (R), FORMER MASSACHUSETTS SENATOR: I'm glad that he called. And he's going to obviously meet with other folks, and we should know, I would think, probably after Thanksgiving.

ACOSTA: There are transition surprises every day, with Democratic Congresswoman Tulsi Gabbard being floated as a possible United Nations ambassador. And past rival Rick Perry under consideration for energy. Not to mention the ultimate cliffhanger, Mitt Romney. Transition sources say the 2012 GOP nominee is a real possibility for secretary of state. Potentially shifting Rudy over to homeland security.

Even more unclear is the fate of Chris Christie. He was bumped from his role leading the transition.

UNIDENTIFIED MALE: Vice-President-elect Pence, I see you...

ACOSTA: Trump is still taking time out for other forms of drama: sparring with the hit Broadway show "Hamilton" after the cast pleaded with Vice-President-elect Mike Pence to respect diversity.

UNIDENTIFIED MALE: Are you still upset about Hamilton?

DONALD TRUMP (R), PRESIDENT-ELECT OF THE UNITED STATES: They were very inappropriate. Thank you.

ACOSTA: "Apologize," demanded Trump on Twitter. Pence seemed to care less.

GOV. MIKE PENCE (R-IN), VICE-PRESIDENT ELECT: We heard a few boos, and we heard some cheers. And I nudged my kids ad reminded them that's what freedom sounds like.

ACOSTA: Trump also complained about his treatment on "Saturday Night Live."

UNIDENTIFIED MALE: What did you think of "SNL" last night?

TRUMP: Not much of a show.

ACOSTA: Trump potentially has bigger problems looming, like the growing chorus of white nationalists and neo-Nazis in the self- described alt-right movement, who are cheering his election. At an alt-right conference in Washington, one of the movement's leaders, Richard Spencer, offered this disturbing take on the president-elect's catch phrase, "Make America great again."

RICHARD SPENCER, NATIONAL POLICY INSTITUTE: For us, as Europeans, it is only normal again when we are great again. Heil, Trump. Heil our people. Heil victory.

ACOSTA: Trump's new chief strategist, Steve O'Bannon, is still being pressed on the sometimes racist and anti-Semitic stories featured on his website, Breitbart News. Bannon defended his views to "The Wall Street Journal," adding, "Breitbart is the most pro-Israel site in the United States of America." Former DNC chair Howard Dean, who's now running to lead the Democratic

Party again, described Bannon as a Nazi in an interview with a Canadian news outlet.

HOWARD DEAN, FORMER DNC CHAIR: He's a complicated guy. He appoints a reasonable person who's much more conservative then I am, but for somebody you can talk to, to his chief of staff. And then his senior adviser is a Nazi.

UNIDENTIFIED MALE: You called him a Nazi?

DEAN: Well, he's anti-Semitic. He's anti-black. And he's anti- women.

(END VIDEOTAPE)

ACOSTA: And questions are being raised about how Donald Trump will handle his business interests as president. It's been reported in the last several days, Wolf, that a pair of Indian businessmen met with Donald Trump last week, and that also talked about his business interests in Argentina with the Argentine president.

[07:10:09] But Wolf, the Trump transition team put out a statement earlier today, saying Trump did not have that conversation or did not have that discussion about his business interests with the Argentinian president. And they say that any reports otherwise are completely untrue.

We should also point out, Wolf, I talked to a couple of sources close to Mitt Romney earlier today. That speculation that he's up for secretary of state. One source cautioned me on this saying that it could take a while to iron out these differences between Trump and Rodney. So don't expect an announcement right away, Wolf.

BLITZER: Jim Acosta in New York for us. Jim, thanks very much.

Also tonight, a growing list of questions about some possible conflicts of interests for Donald Trump and his businesses. Let's bring in our senior investigative correspondent Drew Griffin.

Drew, these questions are being raised by meetings that we just heard about, that the president-elect and his adult children already are having. What are learning?

DREW GRIFFIN, CNN SENIOR INVESTIGATIVE CORRESPONDENT: Well, the biggest ethical problem appears to be Trump's overseas deals, which sound like a lot: 150 various companies tied to foreign deals. In reality, it amounts to a few dozen physical properties: golf courses, condos, hotels.

The question is, will those foreign business interests get in the way of the president's inevitable business with foreign affairs?

(BEGIN VIDEOTAPE)

GRIFFIN (voice-over): It started with what was billed as a courtesy call. Japanese Prime Minister Shinzo Abe slipping in a back elevator at Trump Tower to meet the president-elect. Trump's daughter, Ivanka, in attendance. But neither reporters nor their cameras were at the meeting, which reportedly included a gift to Trump of a golf club like this one, a gold Honma Beres driver worth nearly $4,000.

Then came the two businessman from India who apparently owned Trump- branded properties south of Mumbai. According to the Trump Organization, it was just another social call.

KELLYANNE CONWAY, CNN SENIOR TRUMP ADVISOR: I'm very confident he's not breaking any laws. He has many lawyers, accountants and advisors who tell him what he must do and what he can't do.

GRIFFIN: But the meeting is raising questions. While it's not illegal for a sitting president to run a business, it's a question of optics and ethics.

A CNN analysis shows Trump has business dealings in at least 25 countries, including Saudi Arabia, China, Azerbaijan. A month ago, there was worry that the Trump brand was being destroyed by his run from office. But since November 8, things have changed, and presidential ethics experts are saying the only possible solution to end all of Trump's conflicts of interest are for Trump to sell it all, put the money in a blind trust, and end the Trump empire.

RICHARD PAINTER, FORMER WHITE HOUSE ETHICS LAWYER: Of course a blind trust can work, but you have to sell the assets. You can't just put the assets in a blind trust and pretend you don't own them. That's not a blind trust. You have to depose of the assets first through an initial public offering or somewhat a plan.

ACOSTA: Here's why that's probably not going to happen. A large part of Trump's business is Donald Trump. Trump's partners across the globe are buying the right to license that brand. It brings them more rent money for office space, condos and hotel rooms. The brand also comes with the Trump Organization expertise in design, marketing, operations, almost like a franchise. Business partners buy in because it sells, and the Trumps stay involved to make sure the brand doesn't get tarnished.

Daniel Lebensonn, a south Florida developer, took over a failing Trump property and fought to keep the Trump brand, because he wanted to make sure he had access to Ivanka and Eric Trump in almost every part of the deal.

DANIEL LEBENSONN, DEVELOPER/TRUMP PARTNER: We worked closely with the Trump organization in New York and his team to be sure that everything was perpetuating that brand name and the association with luxury product, which was something that was mutually beneficial. We wanted the association. They want the continuity of brand, and that works on both ends. It's profitable for everybody.

GRIFFIN: In a FOX News debate earlier this year, Donald Trump said, instead of selling off the brand, his solution is to pass the brand to the people he has groomed to take it over, all named Trump. Not exactly a blind trust. TRUMP: I have Ivanka and Eric and Don sitting there, run the company.

Say, "Have a good time." I'm going to do it for America. OK? So I would be willing to do that.

UNIDENTIFIED FEMALE: So you'll put your assets in a blind trust?

TRUMP: I would put it in a blind -- well, I don't know if it's a blind trust if Ivanka, Don and Eric run it. But is that a blind trust? But I would probably have my children run it with my executives, and I wouldn't ever be involved, because I wouldn't care about anything but our country, anything.

(END VIDEOTAPE)

GRIFFIN: Wolf, back in January before a single primary was held, Donald Trump's attorney told me the organization had already been working on some sort of contingency plan for the business, should Donald Trump win. He wouldn't get into the details then, and he's not answering my calls today. I think we're just going to have to wait and see what kind of business the Trump Organization is going to be during the Trump presidency, and most importantly, Wolf, who's going to run it?

[17:15:06] BLITZER: Drew Griffin reporting for us. Thanks very much. All good questions.

Joining us now, Republican Congressman Sean Duffy of Wisconsin. He's a key member of the financial services committee, the subcommittee on oversight investigations -- oversight and investigations.

So you think, Congressman, that all of these -- given the fact he's got this global business, there's going to be investigations of potential conflicts of interest?

REP. SEAN DUFFY (R), WISCONSIN: Well, there's nothing to investigate now. I mean, what I think has to happen, though, Wolf, with a global empire like the Trump enterprises, he has to spend some time and figure out how he walls off his business assets so he can just focus on running America.

And you can't have a scenario where, you know, the Trump Organization goes to the kids, but the kids are also part of the administration. You truly have to make sure you're walled off and Mr. Trump is focusing only on America and there's no self-interest or self-profit in what he does as the president.

As you saw, the concern with Hillary Clinton was that, you know, in the State Department, she was helping raise money -- or the allegation went, raise money for the Clinton Foundation. And Americans' brow raised by that. You don't want to see Mr. Trump in the same scenario.

Now, you have to admit, though, we're only, you know, a week and a half after the election. I'm sure his attorneys are aggressively working on a plan to make sure that the Trump brand can continue but also he can be free of it and run the country. BLITZER: Because as you saw, he was photographed having a meeting his

week with a couple of Indian businessmen who are building Trump- branded luxury apartments nearly Mumbai. There you see the picture right there. Is that potentially a conflict of interest for a president to be seen meeting with business executives along these lines?

DUFFY: Well, I'm sure Mr. Trump is going to have to tie up loose ends between now and January 20. And there might be several of those meetings that he takes with other investors, maybe with banks and maybe with his executive team to make sure this transition is fluid with the Trump Organization. But yes, so I think -- I think that's not unheard of.

But he isn't the president yet. He's only the president-elect. He doesn't have any power yet. And that's what's key. This has to get done by January 20. But what happens today is, I think, the processing of putting this -- these assets into a blind trust or at least walling him off so he doesn't have access to the profits and the decisions.

BLITZER: Do you think there's going to be hearings on the Hill, looking into Trump's 25 million dollar payment to settle the Trump University case?

DUFFY: I don't think. And you have to realize, the hearings that were taking place on the Hill with Mrs. Clinton, I think that's what you allude to. Well, shouldn't Mr. Trump have hearings if Mrs. Clinton had hearings? And the hearings, you have to know, were really about using her public office for the personal gain at the Clinton Foundation. And also sending out, you know, e-mails on a private server with classified information. Those were the two biggest transgressions that the hearings were about in the House, as well as what happened in Benghazi.

Mr. Trump doesn't have a scenario. If you have a -- if you have a private enterprise and there's a lawsuit and you settle it, I don't think there's any need to have any kind of a hearing in regard to Trump University. That's private citizens and private litigation, and they've settled it. So I don't think the House in its official capacity has any role or duty to investigate that settlement or what took place with Trump University.

BLITZER: Because the critics are already saying it's hypocritical to say, "Yes, we're going to investigate the Clinton Foundation, pay-for- play and all of that," but not look into this. You've heard those criticisms.

DUFFY: I have, and you know, Wolf, I'll criticize Mr. Trump when I see fit, but I look at the money that was raised with the Clinton Foundation and the concern with the ties to the Clinton State Department. Again, Mrs. Clinton was a government official who was supposed to be working for the American people. If she uses that position for the Clinton Foundation, that's concerning.

Or if you have a private server and you send out classified information on a private server that isn't secure, that's concerning. This is different than Mrs. Clinton as a private citizen or Bill Clinton as a private citizen. They can do what they want in their private lives. We're concerned about what they do in their public life and how it affects the American people.

Again, Mr. Trump hasn't started his public life yet.

BLITZER: All right. We're going to stand by. We have some more questions, Congressman Duffy. I want you to stick around. We'll take a quick break. We'll resume the questions right after this.

(COMMERCIAL BREAK)

[17:23:57] BLITZER: We're tracking the breaking news: a tsunami warning on Japan's east coast after a major earthquake struck offshore. Japan's meteorological agency says a tsunami wave of up to 10 feet is possible. Fukushima, that district is the same area devastated five years ago by a tsunami, which destroyed a nuclear plant. We'll stay on top of this story, update you once we get more information.

The other top story we're following, the Trump transition. On that we're back with the Republican Congressman Sean Duffy of Wisconsin. He's a key member of the House Financial Services Committee.

Congressman, you're -- you're a part of the subcommittee on investigations of that Financial Services Committee. His proposed tax cut alone, according to a nonpartisan tax research group, could cost up to $5.9 trillion, if all of those proposed tax cuts were implemented. With concerns about a growing national debt, how concerned are you about that estimate, nearly $6 trillion?

DUFFY: So a couple points on that, Wolf.

No. 1, you have to look at tax reform in conjunction with eliminating and reducing loopholes and preferences in the tax code. You've seen over the course of generations powerful lobbyists come to Washington and carve themselves out of the tax codes. They're not actually paying the rates that they pay today.

[17:25:19] So if we can lower the rates but also make the code simpler without so many write-offs and loopholes, I think we're going to be way better off.

But No. 2, you have to look at this and say, if we just look at it in a box and don't see the growth that comes from tax reform, you can see higher deficits. But if you lower your taxes, you keep more companies here, you incentivize more investment, you get more economic growth, you have more people making more money and paying more in taxes. So you look at it dynamically instead of statically. And I think with that and a growing economy, I think we're going to actually bring more money into the federal coffers than less.

BLITZER: So which loopholes -- which loopholes do you think need to be eliminated and how much is that going to save? DUFFY: Well, that's a wide debate, and there's a couple that will

make the hair on people's necks stand up that are kind of sacrosanct, like mortgage interest reduction and charitable deductions. Those ones we want to keep around.

But we can start looking at a lot of other deductions, and the tax code is -- and again, 4,700 pages long. There's a lot there to cut a lot of these business taxes out. But I'm not going to go into every one of them. There's thousands of them. We have to start with a blank sheet, set our rates and go, "What kind of write-offs should we have," and everything else taken out.

BLITZER: Let me shift gears for a moment. When we last spoke, you said you didn't think it was very presidential to be up at night tweeting.

DUFFY: I did say that.

BLITZER: This weekend Trump was tweeting. He criticized the cast of the Broadway musical "Hamilton," criticized "Saturday Night Live." Do you believe Donald Trump, the president-elect of the United States spends too much time responding to his critics directly? Do you think that's appropriate?

DUFFY: You know, I know he gets criticism for it. I might have more concern if I didn't see how hard he's working. I mean, the guy is up taking meetings at 5 in the morning and going until 9 p.m. at night, making sure he builds a team that can make America great again.

And I think -- you know, with the Hamilton crew, I think he was personally offended by that. The cast said, "You know what? We're a diverse America," but the cast is not a diverse America in regard to political thought. They all share the same political viewpoint. And frankly, if you don't share their viewpoint, they attack you and demonize you.

I think liberals and conservatives have to be far more accepting of people who don't agree with their perspective on the world.

My mother is a Bernie Sanders supporter. She loves Bernie, and I love her. We've got to be able to get along with people, whether it's your family and your friends or you should be able to go to the theater and have that be a safe space and not have one guy with the microphone stop you and start telling you his political view. That's not conversation when one guy has the microphone.

And I thought Mr. Trump and Mr. Pence, I think, played it pretty well. Mr. Trump went after the folks at "Hamilton," and Mr. Pence, I thought, was very gentlemanly and played it off very well and said, "The boos and the claps, you know, that's democracy, kids." Pretty cool.

BLITZER: And the vice-president-elect was also very generous. He thought he and his family, who were there, he thought it was an excellent musical. He enjoyed it very much, and he didn't take all that seriously the admonition that he got afterwards. He was listening from the back.

All right. Thanks very much, Congressman. Appreciate it.

DUFFY: And Wolf, one other point. Wolf, I think it was nicely said. You know what? We should -- I'm going to be a president and the vice president for all of America. We want to take in all your points of view, which I thought was the right message to everybody...

BLITZER: All right.

DUFFY: ... coming out of that little conflict.

BLITZER: Congressman Duffy, as usual, thanks very much.

Coming up, Donald Trump, as we just heard, he takes on "Hamilton," the Broadway musical, and "SNL." So what will it be like when he's in the White House?

(COMMERCIAL BREAK)

BLITZER: Take a look at this, live pictures coming in from Trump Tower in New York City as we follow another busy day of meetings for the president-elect of the United States.

[17:33:39] Senior adviser Kellyanne Conway says Trump is working 18 hours a day, talking with Republicans, Democrats, but he's in no rush to make a cabinet and staffing announcement. We'll see if anything emerges in the course of the next few hours.

Our political correspondents and experts have been working their stories. Sources, I should say. Jim Acosta, he spent a lot of time this week and apparently tweeting about how Mike Pence...

ACOSTA: Right.

BLITZER: ... as we just reported was treated after attending the Broadway musical "Hamilton," and the critics are saying, should he really be focusing in on that or other, much more important issues? What are you hearing from his -- from sources close to the president- elect?

ACOSTA: Right. Inside the transition, they say, Wolf, Donald Trump is going to be Donald Trump. He is going to tweet occasionally about current events, about things that upset him. And so for folks out there who think that the president-elect is going to put down his smartphone on January 20 and never pick it up again, they're just deluding themselves.

But look, Wolf, obviously, you know, this was a big distraction over the weekend. It sort of took time away from, you know, what was going on with this very important cabinet selection process. But at the same time, and I think, you know, if past is prologue, Trump may have been fanning the flames of this controversy somewhat to take some of the attention away from some other stories that were going on.

[17:35:00] Remember, on Friday afternoon, the Trump University settlement came down, and then that evening Mike Pence was booed and, some say, cheered at that showing of "Hamilton." And so it was a useful distraction for the president-elect all weekend long.

BLITZER: Ryan Lizza, that $25 million settlement would end that Trump University lawsuit. How significant is that settlement?

RYAN LIZZA, CNN POLITICAL COMMENTATOR: I think it's significant in the -- in a sense. This is someone, President-elect Trump, who has said in the past that he doesn't settle lawsuits, because it just attracts more. From his record, we know that's not the case; he often settles lawsuits.

It's a big deal for the president-elect to have to pay out such an enormous amount of money by a group of people with credible claims that he defrauded them.

I mean, think about this. We've never had someone a few weeks away from putting their hand on the Bible to swear an oath to the Constitution who, in the -- in the transition period, is settling fraud lawsuits. It's a big deal.

And look, I think that part of the reason sometimes Trump likes to stir up controversies like the one he did with "Hamilton," they do often come at these moments when there are these other issues in the news, and I think sometimes they're related. So I think the "Hamilton" controversy, while important to cover, may have been a bit of a smokescreen by Trump to take away attention from this pretty bad piece of news for him.

BLITZER: As you know, Caitlin Huey-Burns, a bunch of Democrats are imagining if Hillary Clinton, for example, settled a fraud lawsuit for $25 million, how Republicans in Congress would be reacting. Presumably, there would be investigations, committees looking into all of this right away.

CAITLIN HUEY-BURNS, REAL CLEAR POLITICS: Absolutely, Wolf. And Democratic Congressmen Elijah Cummings has said -- he's, of course, the ranking member of the oversight committee -- he has said he wants to look into Trump's financial dealings. Of course, Trump has not released his tax returns. You have Elizabeth Warren talking about how it's unprecedented for a president-elect to be settling a fraud case.

Democrats are upset about this, and the avenues with which they have to go after Trump on this sort of thing just aren't really there, because they don't control the House or the Senate.

But certainly, you would have, I think, at least seen attempt by Democrats to prosecute this case if it were in the reverse. They are, however, arguing that, because Trump is not in government yet, because he hasn't had experience, because he wasn't an official of the State Department or of some government entity, that this is a different situation.

BLITZER: You know, Jim Acosta, the signs that Trump is planning to draw a line between his administration and his huge billion-dollar business, if you will, the repercussions are very serious as far as the ethics and the law in the constitutionality of all of this.

ACOSTA: Right.

BLITZER: What are you hearing from inside? How are they going to draw that line to make sure that the president of the United States does not get involved in his business?

ACOSTA: Well, I think instead of draining the swamp, the swamp is filling up a bit this week, Wolf, with some of these reports.

But what they say inside the Trump transition, and they said this during the campaign, Wolf, is that Donald Trump as president of the United States is going to be exempt from some of these conflict of interest laws. Now if you're a cabinet secretary on down, you have to put your assets into a blind trust. Some of these laws do not apply to the president and the vice president of the United States.

Now, having said that, Wolf, there is a portion in the Constitution, a section of the Constitution that says, as president of the United States, you cannot accept gifts from foreign governments. And so they are going to have to create some pretty clear lines for Donald Trump in all of this.

But remember, he is the president, and what we learned throughout this entire campaign process is that he does what he wants, and then his staff reacts. And that appears to be the pattern that is playing out during this transition.

BLITZER: The White House counsel is going to be busy, once there is a White House counsel to deal with all these potential legal issues.

Everyone stand by. We're going to take a closer look at some of the latest comments from Senator Bernie Sanders, some of them critical of Hillary Clinton. We'll take a quick break. We'll be right back.

(COMMERCIAL BREAK)

[17:43:57] BLITZER: We're back with our correspondents and political experts.

Caitlin Huey-Burns, last night Senator Bernie Sanders said the Democratic Party should move away from what he called "identity politics." He criticized Hillary Clinton's emphasis on gender, implied she should have been more focused on what he called progressive issues.

Here's the question. How much power will Bernie Sanders have to push the Democratic Party in that direction?

HUEY-BURNS: Well, Sanders himself sees himself as someone who will be shaping the future of the Democratic Party. It is worth noting, however, that he is not officially a member of the Democratic Party. He is still a registered Independent, and when I asked him if he was planning to change his registration, he said he would serve out this term and then decide when the time comes. As we know, Chuck Schumer, the now -- who will be the Senate minority

leader, has elevated Bernie to a leadership position in the Senate, and he is now tasked with making outreach efforts to progressives, kind of bringing them into the fold.

Sanders has been arguing that the economic message that Democrats have, or they should have, is not resonating with most Americans.

[17:45:04] He was saying that the Democratic Party can have an economic message that appeals to not only the White working class but Latino voters, as well, who are class, he says. Black voters who are also part of the working class, he says. So he is making the case that the economic argument just didn't penetrate, especially in places that it needed to.

BLITZER: You know, Ryan, we're hearing that Vice President Joe Biden's name is now being floated for a possible chair of the Democratic National Committee. You think that's realistic? How involved would he be -- President Obama, for that matter -- in the future of the Party once both of them leave office?

LIZZA: I don't think it's realistic. I would be shocked if Joe Biden went from being vice President of the United States to DNC chair. Being the chair of a party is a pretty thankless task. I suppose if he was going to be, you know, just a sort of spokesperson for the Party and have someone else deal with the day-to-day stuff, maybe it would make sense, but I don't think that that would appeal to someone like Vice President Biden.

You know, interestingly, Obama was asked about this, Wolf, and he did not rule out speaking his mind when he feels it's necessary during, excuse me, the Trump presidency. As you remember, George W. Bush, when Barack Obama became President, basically disappeared from public life and would never, that I can recall, criticize Obama at all. That has been the sort of the tradition of ex-Presidents, sort of being quiet, especially during their successor's term.

But Obama, given the nature of this unconventional President-elect, it sounds like he is going to reserve the right to speak up when he thinks it's important. And I think, even more so, Biden would be in that camp.

BLITZER: All right, guys. Everybody stay with us. Coming up, he's perhaps the most controversial figure in Donald Trump's new inner circle, Steve Bannon. He is breaking his silence and is adding to a political firestorm.

(COMMERCIAL BREAK)

[17:51:39] BLITZER: We're following a growing fire storm of criticism after Steve Bannon, the former Breitbart executive who is now Donald Trump's chief strategist/senior counselor, broke his silence about his own and Donald Trump's agenda. Brian Todd is looking closely at all of the latest developments. What are you learning, Brian?

BRIAN TODD, CNN CORRESPONDENT: Wolf, tonight, there are serious concerns about the fact that Steve Bannon is going to be guiding President Trump's vision for running the country as his chief strategist and senior counselor. Bannon is accused of embracing a movement tied to White nationalists and anti-Semites.

Steve Bannon, though, is pushing back tonight, saying his agenda has been misinterpreted. And he's crowing tonight about how he believes the mainstream media repeatedly underestimated Donald Trump and the people who voted for him. He says darkness is good. He says, Dick Cheney, Darth Vader, Satan, that's power.

(BEGIN VIDEOTAPE)

TODD (voice-over): Steve Bannon, the rumpled 62-year-old who once headed Breitbart News, now has the ear of the President-elect, and many worry he will push the platform of the so-called alt-right.

KURT BARDELLA, FORMER MEDIA CONSULTANT FOR BREITBART NEWS: We have, in our history, have never had someone like Steve, with the platform that he has had at Breitbart, come in to, basically, be the co-chief of staff, you know, running the White House and running the agenda of the President.

TODD (voice-over): Civil rights groups like the Anti-Defamation League and the Southern Poverty Law Center say the alt-right movement is just code for White supremacists and anti-Semites. And they say Bannon has to go. Bannon pushes back, telling "The Wall Street Journal," quote, "Breitbart is the most pro-Israel site in the United States of America. We're a leader in the reporting of young Jewish students being harassed on American campuses."

On the accusation that he has, at least, loosely embraced White nationalism, Bannon told "The Hollywood Reporter," quote, "I'm not a White nationalist, I'm a nationalist. I'm an economic nationalist."

A.B. STODDARD, ASSOCIATE EDITOR AND COLUMNIST, REALCLEARPOLITICS.COM: What is Bannon says is that he is anti-globalist, anti-elite, anti- establishment, and that he is an economic populist because he believes that the system has hurt and hindered the little guy. It has nothing to do with race, religion, or anything else.

TODD (voice-over): Bannon jumped on the Trump train early on, telling Trump last year he was a big admirer.

STEVE BANNON, CHIEF STRATEGIST AND SENIOR COUNSEL TO PRESIDENT-ELECT DONALD TRUMP: I said, look, people are leaning forward in these audiences when he was talking. Of course, we were mocked and ridiculed.

TODD (voice-over): Now, it's Bannon who is mocking and ridiculing the mainstream media, who he blames for failing to recognize the frustration of Americans left behind in the global economy, quote, "It's just a circle of people talking to themselves who have no effing idea of what's going. If 'The New York Times' didn't exist, CNN and MSNBC would be a test pattern."

Kurt Bardella, who quit Breitbart feeling it had become a mouthpiece for Trump, is now critical of Bannon. He sees that "darkness is good" remark as chilling.

BARDELLA: I think that's very much how Steve views the world. The worst emotions amongst us can be weaponized and used to advance an agenda. And I think a lot of what you saw in the Trump campaign and what you'll see going forward is tapping into anger and fear and hate to try to move their agenda forward. And I think that's exactly who Steve Bannon is.

(END VIDEOTAPE)

TODD: The Trump transition team did not respond to our numerous requests for response to that criticism, and Steve Bannon did not comment for this story. Wolf.

BLITZER: Brian Todd reporting. Thanks very much. Coming up, we're tracking the breaking news. A tsunami warning after a major earthquake off of Japan in the same area devastated by a tsunami just five years ago.

[17:55:03] And as Donald Trump interviews possible cabinet picks, his election victory is being hailed by some White nationalists. I'll talk to the head of the NAACP, Cornell William Brooks.

(COMMERCIAL BREAK)

BLITZER: Happening now, breaking news. Tsunami sighted. A potentially deadly wave triggered by a powerful earthquake is now off the coast of Japan. Warnings are up in the same area devastated by a tsunami just five years ago.

Building a cabinet. President-elect Trump holds multiple meetings with potential picks for top positions in his administration. Long time loyalists, former rivals, sharp critics, and even a Democrat, all sitting down with Trump. Is he about to announce some top appointments?