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House Intel Approves Release of Stone's Interview Transcript; Trump Defends Syria Decision Amid Bipartisan Backlash; Dow Drops After Fed Hikes Interest Rates; Whitaker Chose Not To Recuse. Aired 12:30-1p ET

Aired December 20, 2018 - 12:30   ET

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


(COMMERCIAL BREAK)

[12:30:34] JOHN KING, CNN ANCHOR: Welcome back.

A lot of breaking and developing news stories in Washington today. The president of the United States as we speak meeting with House Republicans at the White House. The big question, will he demand changes to a plan that they thought was on a glad path of passage to prevent a partial government shutdown. The president wanting more money for his border wall. We'll see how that one plays out at the White House.

Also today, the Acting Attorney general Matthew Whitaker getting a green light to oversee the Robert Mueller investigation. Many Democrats thinks that's a bad idea because of things Matthew Whitaker said before he joined the Trump administration harshly critical of the Special Counsel Robert Mueller. And what Matthew Whitaker said, again before joining government was an overly broad mandated his view.

Among those with deep questions, the ranking Democrat on the Senate Intelligence Committee, Mark Warner who's on Capitol Hill with CNN's Manu Raju.

Manu?

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Yes. Hey John, thank you.

Senator Warner thanks for talking to us. We have learned about from William Barr of the acting attorney general's memo that he wrote this year raising the questions about the Mueller investigation. What is your reaction when you saw reports and saw this memo?

SEN. MARK WARNER (D) VICE CHAIRMAN, INTELLIGENCE COMMITTEE: My reaction is that it appears that the number one qualification Donald Trump is looking for in an attorney general is someone that will try to undermine the Mueller investigation. I think it's more than a little bizarre that a private attorney, Mr. Barr would write this kind of memo and then in effect give it, my understanding to officials on the White House almost as an attempt to solicit this position to say, hey Mr. Trump, don't worry, I'll have your back on the Mueller investigation. To me, this is -- makes this individual disqualified for the position. I will listen to any explanation, but when he starts out with a belief that the president is in effect above the law, I think that is not the appropriate legal president. I think it is not the appropriate approach. And via most tacky way that he has used this memo as a way to solicit the position is the very least unseemly.

RAJU: Do you think the president should withdraw this nomination?

WARNER: Listen, I think the president should withdraw this nomination. But I didn't think the president for example should have put Mr. Whitaker and either. And again, a month ago, the acting attorney general, Mr. Whitaker, we wrote a letter saying, his obvious conflicts of interest and again views on Mueller. We wanted to know whether he would have to disqualify himself from overseeing Rod Rosenstein and the Mueller investigation.

It's reported that we're going to get a response today. Now this is a letter we wrote over a month ago but it's already been reported in the press that the -- somebody at the DOJ has cleared Whitaker to be able to oversee Rosenstein and the Mueller investigation.

Again, we need to hear an answer on that. I find that very troubling as well. But we see this constant pattern. You know, what drove out Sessions was a fact that Sessions did the right thing by allowing Rosenstein the ability to oversee the Mueller investigation. And now we've seen Trump repeatedly, you know, demean the Mueller investigation and clearly the folks he's looking for to fill this position are people that will give his cronies the ability to take over the Mueller investigation and basically undermine it.

RAJU: And one question -- last question before we send it back to John. So let's say the House Intelligence Committee voted to send a transcript of Roger Stone to the Robert Mueller's team. Have you shared transcripts to Robert Mueller's team as part of the Senate Intelligence Committee investigation?

WARNER: We have worked with the Mueller investigation on a regular basis. I'm not going to comment about specific information. But clearly, we've made referrals and some of the individuals that have been or the subject of criminal charges came from information that we we're able to relay.

RAJU: Yes. All right, Senator Warner, thank you.

John, back to you.

KING: Interesting day on the Hill. Manu Raju, thank you.

Before we go to break, (INAUDIBLE) just one quick question on the math. Chuck Schumer says, Will Barr disqualified. Mark Warner says, Will Barr disqualified. Senate Republicans will have 53 votes, Will Barr has very deep ties in the Republican Party going back to George W. Bush.

So, the Democrats have a political case to make. There is zero evidence he's in any trouble, assuming the president actually sends (INAUDIBLE).

PAUL KANE, SENIOR CONGRESSIONAL CORRESPONDENT, THE WASHINGTON POST: Yes. You know, they would need four Republicans to break.

[12:35:02] At this point, I don't see any way where those votes would come from. He would have to stumble at his hearing.

Lindsey Graham has said, he needs to be able to say the Mueller investigation will be able to continue. As long as he can answer that question, he's going to clear 50.

KING: All right. We'll watch that one play out. That's one of the big questions on Capitol Hill. Again, the president meeting right now to see if we'll have a plan or a disruption in a plan to keep the government funding.

And when we come back, the president's party in his face big time over his abrupt decision to withdraw U.S. troops from Syria.

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KING: President Trump today is defending his abrupt decision to pull U.S. troops from Syria and he has a big supporter, Vladimir Putin.

[12:40:05] The Russian president says, he agrees there's been progress against ISIS and that he think it's a good call to withdraw U.S. troops. President Trump on his part says he doesn't understand those who say they feel blindsided by this decision.

The president tweeting this morning, quote, getting out of Syria was no surprise. I've been campaigning on it for years. And six months ago, when I very publicly wanted to do it, I agreed to stay longer. Russia, Iran, Syria, and others are the local enemy of ISIS, we were doing their work. Time to come home and rebuild.

But the outrage on the opposition is only growing today largely from the president's own party that Putin is in favor, only adds to the argument of Republicans who say it is a bad and a dangerous decision. This is Senator Lindsey Graham, moments ago on Capitol Hill.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM (R) SOUTH CAROLINA: I don't know how this decision was made. It literally came out of left field. It has rattled the world. You see North Korea flexing their muscle now. (INAUDIBLE) that you leave South Korea before we do a deal.

I can promise you that everything that happened in Iraq is going to happen in Syria unless we change course. And I can promise the president, if you will reevaluate this decision, you'll have a lot of support across both sides of the aisle.

(END VIDEO CLIP)

KING: It's just remarkable to listen to that. There was a lot of it on the floor of the Senate last night. The president's nationalist immigration base is mad. That's your traditional, more hawkish Republican foreign policy establishment saying, this is bad, this is dangerous. This is a stain on America, Lindsey Graham said last night.

No indication the president by his tweet this morning though, it doesn't seem he's going to back down.

ELIANA JOHNSON, WHITE HOUSE REPORTER, POLITICO: That's right. And this is an interesting decision because the president is fulfilling a campaign promise about getting out of these years long wars in the Middle East, bringing American troops home. But he's also gotten a lot of support on Capitol Hill from lawmakers like Lindsey Graham and Tom Cotton, who have defended his war policy moves, being tough on Iran, pulling out of the Iran deal. And are now slamming him on this saying that pulling out of Syria and bringing the troops home, emboldens our foes like Iran and Russia.

So while the president maybe at satisfying his core base, he's alienating allies on another flank and really important some spokespeople, lawmakers on Capitol Hill. And so he isn't really satisfying -- this is the move that I would say, divide the Trump base, it satisfies some, but alienates others.

KING: And angers even a lot of his own advisors who say, yes, Mr. President, we're about 80 percent, maybe 85 percent of the way there in defeating ISIS but we're not a hundred percent there. And history proves, if you leave them a little bit and you get out, then they grow again.

JOHNSON: And aggravating that is the method of the decision which was not (INAUDIBLE) process, surprised a lot of people. And so I think that added a lot insult to injury.

MICHAEL SHEAR, WHITE HOUSE CORRESPONDENT, THE NEW YORK TIMES: Well, and in fact, I do think that as much as the substance, the thing that has the world kind of taken aback is the idea that the American president could do this in such an abrupt way with no consultations with world leaders, with no consultation with members of Congress. With apparently very little consultation with his own National Security team and over the advise of the National Security team.

You know, I recall when President Obama wanted to re-evaluate the United States' role in Afghanistan at the beginning of his term, and there was a lot of criticism for him taking too long. He was months and weeks and months of meetings and hand ringing about what to do, getting every possible, you know debate kind of on the table. That perhaps you could say went too long but this is so far the other direction that's it got everybody really rattled.

KING: And part of the rattling is if you're making this decision in Syria, what about next time the Afghanistan question comes up. Or what about troops in Iraq?

KANE: They unloaded on Mike Pence yesterday. Senate -- Mike Pence came up to visit Senate Republicans, presumably it was planned because, you know, he want to talk about government funding. It was all about Syria.

And the Republicans came out of that room hot. And they were telling us -- it wasn't leaking, they weren't whispering off the record. No, they were on the record unloading. Guys like Ron Johnson who do not usually rip part of this administration. So, they've got a lot of work to do.

KING: To that point, it's interesting. This is an individual question. Troops overseas, troops in Syria to fight against ISIS is very interesting, but to the broader memo we we're talking about. After the midterm shellacking, the question is now about government funding. His party -- the base of his party revolving on immigration.

I'm not suggesting anybody go to Fox and Friends in the morning to get foreign policy advice but this is interesting. This is the president's cheerleading show if you will, they don't like to see there.

(BEGIN VIDEO CLIP)

BRIAN KILMEADE, HOST, FOX AND FRIENDS: We had the success against ISIS because the president changed the rules of engagement and made it a focus. We had success. It wasn't a victory.

Lindsey Graham, Bob Corker, Senator Klobuchar, but anyone who goes there understands this and the president blindsided the State Department, the Defense Department in doing this.

[12:45:05] UNIDENTIFIED MALE: What he's going to do?

KILMEADE: He is doing exactly if not worse than President Obama did. This is worst than drawing the red line.

(END VIDEO CLIP)

KING: Again, the -- exactly if not worse than President Obama on a program that is normally, you know, pom pom to cheerleading for the president of the United States. It tells you something about the moment.

TARINI PARTI, WHITE HOUSE REPORTER, BUZZFEED NEWS: I think even the president was not sure on how to message this. It was -- it seemed to have been done on his gut as he likes to say. And even on Twitter when he try to talk about it, he was contradicting his own message. At one point he was saying, we defeated ISIS, this is why we're coming home, and the next minute he said, this is a war that Russia and other local -- a local fight for others to fight.

So, have we defeated ISIS? You know, that whole question, he seemed to walk back in his follow-up tweets. So even -- you know, when there's not a clear message, even his allies on Fox can't really defend him.

KING: It's a tough one on the substance and to your point about how it played out, the process also, getting the president in hot water. We'll keep an eye on that. Up next of us, still more big news today, more market instability. The Dow dives again after the Fed hikes interest rates against the pleas of the president.

(COMMERCIAL BREAK)

[12:50:20] KING: Welcome back.

Big market news today, the Dow losing even more ground, one day after hitting a 2018 low. Investors keeping a close eye on the markets after the Federal Reserve hike interest rates yesterday. See you found there almost 350 points.

Let's go to Cristina Alesci. She's at the New York Stock Exchange. Cristina, question is what's the mood? But I'm guessing it's not so great. What are you hearing from investors looking ahead.

CRISTINA ALESCI, CNN POLITICS AND BUSINESS CORRESPONDENT: It's blood on the street right now. In fact, the market took a downturn even more after the president express frustration over border wall funding and basically undermine the potential deal to avoid a government shutdown. So that did not help things here on the market but no doubt about it, the selling begin with the Fed, introducing a Fed -- an interest hike yesterday and that selling has continued unabated.

And what is happening here is a basically a fundamental fight between Wall Street and the Federal Reserve which believes the economy is strong enough to withstand an interest rate hike. And the Street, however, wants to keep the easy money flowing. It's been addicted to that.

Also, investors and traders are very frustrated by the vague comments that Jerome Powell gave yesterday, the Fed chair. They just interpreted that as completely negative. They wanted more clarity and they also felt like the chairman did not address some of the warning signs that are flashing about a global economic downturn, like weakness in China for example around economic data.

So these are the concerns on the street right now and they continue unabated. We are down below 2,300 on the Dow -- 23,000 on the Dow. And it seems like the selling will continue.

John?

KING: Below 23,000 in a market that was at 27,000 not a little long ago. Cristina Alesci on the Wall Street, thanks very much. Keep in touch as the day plays out.

Up next, President Trump's base demands a fight. Will he listen? And if he does, will that force a Christmas government shutdown?

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[12:56:51] KING: Some new information now on the decision from Justice Department officials to give Matt Whitaker, the acting attorney general, the green light to oversee the Russia special counsel investigation.

CNN'S Laura Jarrett is at the DOJ. Laura, your source says, a close call?

LAURA JARRETT, CNN JUSTICE REPORTER: That's right John. We're learning a lot more information about all of it went down over the past six weeks as the attorney general -- Acting Attorney General Matt Whitaker was advised on the applicable rules and regulation. And while he was never actually given a formal recommendation about a recusal -- he actually never sought one, he was given certain guidance.

And here's what I'm told according to a senior DOJ official who was familiar with how all of this process and what all happened. And what we're told is, while ethics officials while looking at the rules found no actual legal conflict, it's not as if Whitaker had a family member or some monetary investment connected to the Mueller probe. The ethics official who was task at looking at this, said in his opinion, based his review and an abundance of caution on the appearance, just the appearance of a conflict based on Whitaker's passed statements criticizing that Mueller probe that out of an abundance of caution, he would recommend recusal.

But at the end of the day, it's Whitaker's decision. He doesn't have to follow the advice. And at the end of the day, he ultimately decided not to recuse based off of close consultation with his own advisors who look at all the facts and circumstances surrounding this including past, past presidents. And they could never find a case where someone recused based off of appearance only and so ultimately he has decided not to, John.

KING: A fascinating moment. Laura Jarrett, appreciate the reporting.

And so Matthew Whitaker will say, it's my call. I'm making this call, judge me by my actions. Democrats will say, they said you should probably maybe you're on the side of caution and step away. Where do we go?

SHEAR: Well, look, it's only going to be temporary, right, because there's another person that's already been nominated.

KING: But that's a couple months away.

SHEAR: Which could be a couple months away and there's time for him to prove with -- through his actions what this really means, right, as oppose to just appearances. But can you imagine what this president of the United States would have done if he had recuse, right?

(CROSSTALK)

SHEAR: -- exploded given the history --

JOHNSON: Yes.

SHEAR: -- with Sessions and that recusal.

KANE: Yes.

SHEAR: And so --

KING: It satisfies the president but the incoming Democratic majority in the House is going to be put him in the hot seat now.

UNIDENTIFIED MALE: Yes.

JOHNSON: He was put there to give the president peace of mind, that he has an ally at the top of the Justice Department. If he had recuse himself, I mean -- It would have been mayhem.

KANE: Jerry Nadler, right? Jerry Nadler is going to bring him in and we're going to have him

testify for the House this year.

SHEAR: And his decision was better that than --

(INAUDIBLE)

KING: To be fair to Mr. Whitaker and the time he's been there since November, there's no indication he has put any pause on Robert Mueller. The question is now that's he's through this Q&A with the ethics officials, what he do now.

JOHNSON: It looks like he is simply will not touch the Mueller probe but not recuse himself. And he's between a rock in a hard place between Donald Trump and House Democrats.

KING: One of the many still developing fascinating stories as we end the year. This is normally the slow time. We live in a different age.

Thanks for joining us today in the INSIDE POLITICS. Remember, the president still meeting with House Republicans to talk about shutting down the government.

Picking up our coverage, Brianna Keilar. She starts right now.

Have a great day.

BRIANNA KEILAR, CNN ANCHOR: I'm Brianna Keilar live from CNN's Washington headquarters.