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Inside Politics

President Trump's Budget Blueprint; WH Releases Its Budget Proposal Filled With Cuts; Trump: Wiretap Covers A Lot of Different Things; House Speaker Dismisses Trump Wiretap Claims; Trump: I Wouldn't Be Here Without Twitter; McCain, Paul Blast Each Other Over NATO Bill. Aired 12:30-1p ET

Aired March 16, 2017 - 12:30   ET

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

(COMMERCIAL BREAK)

[12:31:16] JOHN KING, INSIDE POLITICS HOST: Welcome back. The President's budget always gets rewritten by the Congress. So it's important to consider it not as the last word but as a starting point, a statement. What a dramatic statement the first Trump budget is. Let's take a look at some of the winners and losers. The big winners, the Department of Defense, the Pentagon, gets a 10 percent increase. The Department of Homeland Security, border security is included here, up 7 percent.

The President promised in the campaign to take care of the veterans. Department of Veterans affairs up 6 percent. But a lot of losers if the President's budget were enacted as is. Environmental protection agency loses almost one-third of its budget. The State Department, 29 percent. The Department of Labor, 21 percent. Agriculture, a lot of rural states carried by Trump get money from the agricultural, 21 percent. The Army Corps of Engineers down.

Do you get he trend? Look at this, down, down, down. Health and Human Services, Housing and Urban Development, transportation, education, one more stream. Down, down, down. Just about every non- security department in the government loses spending. Democrats say this is cruel. Republicans say we'll give it a look and we'll see what happens here. The President's budget director says if you followed the campaign, you should not be surprised.

(BEGIN VIDEO CLIP)

MICK MULVANEY, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET: A real simple you have an America first candidate, you have an America first president, now you have an America first budget. We're spending more money to defend the country, more money to enforce the laws, more money to secure the border, more money to take care of our vets, more money for school choice and less money for things like foreign aid. It's exactly what the President said he was going to do. That's what the budget is.

(END VIDEO CLIP) KING: That's what the budget is. And again it is a starting point. But it is a pretty dramatic statement. Most of the commentary not since Ronald Reagan have we had a President that comes into Washington and essentially says I'm going to rip some roots out. I'm not just going to propose different in spending but I'm going to rip some roots out. I guess the question is as a statement, what's its shelf life?

MARGARET TALEV, BLOOMBERG POLITICS: I'm -- in the -- there's two questions, right? One is what does it actually translate into? But I think as a statement, it actually absolutely encompasses what he talked about in the campaign. What his base believes in. To some degree, what Republicans believe in. The really interesting split to me is not on the domestic agencies which are sort of obvious but on the State Department where the rubber really meets the road.

The idea that this is a hard power budget versus a soft power budget and that the State Department would be gutted, that these global initiatives would be gutted is really where a lot of the decision time is going to come down between the (INAUDIBLE) controlled Congress and the President I think could be very interesting.

DAN BALZ, THE WASHINGTON POST: He promised to come and blow up Washington essentially as a candidate, and that's what this budget tries to do. I mean, it is Reagan asking in the approach in terms of more for defense which Reagan did in 1981 and a lot less, therefore on the domestic side. It's difficult to squeeze some of these programs. They've been squeezed for a number of years because of the budget caps that have been in place. It's hard to get some of this. And there's built-in resistance to it. But in terms of a directional shift, it's very dramatic.

KAREN TUMULTY, THE WASHINGTON POST: And what Donald Trump doesn't have that Ronald Reagan did have is a landslide victory and a Democratic Party that is scared to death of him.

KING: Right. Right. That's a very key point. And even though this Democratic Party is scared to death of Ronald Reagan, they still had the majority in the House and they were able to negotiate a little bit.

BALZ: But a lot of the Democrats who were most scared of him are now Republicans. Those were the conservative Democrats.

KING: That's so true.

BALZ: They're gone. This is a different environment.

PERRY BACON, FIVETHIRTYEIGHT: What I find striking is if you talk to the swing voters who vote forward Trump who want to share (ph), they wanted him to focus on -- bring our jobs back, work on the economy. So far we've had this health care bill and we had this budget which I would argue a very sort of Ted Cruz-like ideas. They are sort of fiscal conservative, sort of Republican but in that sort of right wing part of the Republican Party. I wonder why Trump, to me, these moves don't fit in with what -- he was going to blow up Washington but his first promise was I'm going to bring the jobs back and cutting government funding doesn't really fit into that idea very well.

[12:35:10] KING: I think certainly a lot of the voters who had reservations about him said that he's going to help me. He's a businessman who is going to create job. He's going to help me in these trade deals to keep plan (ph) I think as we go forward. As always, though, it's a starting point. And we'll get to the Democrats in a minute. They don't like any of it.

Republicans say good for you Mr. President for proposing Saskatchewan (ph) government. Here's Marco Rubio, senator from Florida. "The administration's budget isn't going to be the budget. We do the budget here. The administration makes recommendations but Congress does budgets." That's Marco Rubio quoted in a newspaper called "The Washington Post." Anyone familiar with that newspaper here?

BALZ: Fine newspaper.

KING: A fine newspaper. But it say key point, and the question is, and the President's budget director Mick Mulvaney acknowledged this on television this morning. He's a former member of Congress. When you're a member of Congress, you fight for your district. If you are a House member, you fight for your district. If you're Senate, you fight for your state. I am the budget director now. I have to, you know, to do this nationally from what Donald Trump want. But when members of Congress look for this, what's going to jump out at them?

BALZ: All of these. I mean, this list of programs that are being cut. Every one of those has a constituency back home somewhere. I mean, the proposal to cut the national endowments for the arts and the humanities, there are symphonies around the country. There are opera boards around the country. You don't think of those as necessarily Trump base supporters but nonetheless they're going to weigh in.

All of these, there going to be mayors who are going to be complaining. There are going to be governors who are going to be worried about what the impact of this is in terms of cost shifting and cost pass-throughs and unfunded mandates. So there's a lot and every one of those House members particularly is going to be, you know, they're going to be responsive to their constituents even as they're trying to pass a President's (INAUDIBLE) general.

KING: Let's bring the Democratic voice in a debate. The Democrats have short votes in the House. But to pass a big budget you do need some Democratic help in the Senate unless you're going to try to just railroad it through. Nancy Pelosi, the House Democratic leader saying the Republicans are just cruel.

(BEGIN VIDEO CLIP)

REPRESENTATIVE NANCY PELOSI (D), MINORITY LEADER: The Republicans in Congress and this White House as we are seeing now just in a few weeks never miss an opportunity to suck up money from the middle class and working class families to the richest people in our country. And you see that in the health care bill. You see that in how they establish their budget priorities.

(END VIDEO CLIP)

KING: How much sway do the Democrats get in this debate, I guess is my question?

TALEV: Well this goes exactly to Perry's point that if Democrats were somehow able to stay on message and convince voters in Ohio, in Wisconsin, in Indiana, in Pennsylvania, in these places where there is a Rust Belt, working class dynamic that went for Trump this time, that these domestic cuts, these programatic cuts go directly to their needs that would become problematic.

The question has always been though, a lot of these same voters believe in small government. They just don't want the programs that help them to be cut. And it's a difficult sort of thing to balance, you know, so -- yes.

TUMULTY: And this is probably more framing for the midterm elections than it is actual hope that they could prevail on the House and Senate floor.

BALZ: I mean, the other aspect of this is we still haven't gotten the tax reform or tax overhaul --

BACON: Right.

BALZ: -- piece of this. She's right. In terms of the health care bill, the shift from poorer people to wealthier people, aspects of this budget do the same and presumably, the tax cuts will do the same. So by the time you see the entire package, there will be a judgment rendered on kind of what are the priorities in terms of across the spectrum of income scale. What are Trump's real priorities as opposed to what he talked about in the campaign?

Now, how much that will sway his strongest supporters is a very open question. And probably he's got a fair amount of leeway to do it.

KING: Right. That's an important point. Until we know the final math of any health care bill and the final math of any tax reform proposal, this is a document. It's a starting point. But it's even the math within it is not the final math. If the -- if, if, if they get through their other priorities, they said we'll get through this here. Everybody sit tight.

Up next, President Trump digs in on his wiretap claims. But members of his own party say they've been told there's no evidence.

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[12:41:24] KING: Welcome back. President Trump isn't backing down even though top Republicans in Congress say they have seen no evidence to support the allegation that President Obama tapped the phones of Trump Tower during last year's campaign.

Remember this spy saga began 12 days ago with these pre-sunrise tweets. "Terrible. Just found out that Obama had my wires tapped in Trump Tower just before the victory. Nothing found. This is McCarthyism." A bit later, "How low has President Obama gone to", two piece (ph), that's the President, "to tap my phones during the very sacred election process. This is Nixon, Watergate, bad or sick guy."

Again, leading members of his own party have asked the FBI if there's any evidence of wiretapping and have been told no. The President's close friend and Attorney General Jeff Sessions yesterday says, no. When asked if he is the President's source of that information. But the President says, stay tuned.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I had been reading about things. I read in -- I think it was January 20th, a "New York Times" article where they were talking about wiretapping. There was an article, I think they used that exact term. I read other things. I watched your friend Bret Baier the day previous, where he was talking about certain, very complex sets of things happening, and wiretapping. I said, "Wait a minute, there's a lot of wiretapping being talked about." But wiretap covers a lot of different things. I think you're going to find some very interesting items coming to the forefront over the next two weeks.

(END VIDEO CLIP)

KING: OK. Let's unpack this. Number one, a lot of people read this as the President trying to retreat. That the President knows there's no evidence and he's trying to say it could have been about this, that or the other thing and wiretap could be so widely, broadly defined. So, is he sticking to his guns or is he trying to back out here?

BACON: That was sort of like -- I would call a word salad of sorts. There, I don't think he's sticking to his guns -- I mean, but he doesn't really apologize for things or back away. Maybe be certainly, not feeling the way he was 10 days ago. Also if he's lost Jeff Sessions, he's lost. Because -- I mean, Jeff Sessions is one of his strongest supporter.

KING: Is he going to try to claim because they listen to General Flynn in a phone conversation with the Russian ambassador who is routinely monitored in Washington, is the President going to say well that's what I meant in reminiscing (ph) the effect? That those tweets are pretty specific. He is not a candidate anymore. He's the President of the United States who in those tweets was accusing his predecessor of Nixonian behavior and potentially law breaking.

TUMULTY: Well, predicting where Donald Trump ends out is sort of fool's errand on all of these because in this -- you do hear the word solid but then it's a very end (ph) he comes back. And then in the next couple weeks you're going to hear something very interesting. It was very reminiscent of years ago when he claimed to have sent investigators to Hawaii to find out the truth about where President Obama was born.

KING: We're still waiting for that.

TUMULTY: Same investigators maybe. KING: So -- but this has been embarrassing for his fellow Republicans. So, the House Intelligence Committee Chairman Devin Nunes, a Republican who has been pretty loyal to President Trump came out yesterday and said there's no evidence. We've asked. There's no evidence. The House Speaker Paul Ryan again trying to navigate a very difficult environment. Health care now, tax reform next. Asked about this just today.

(BEGIN VIDEOTAPE)

MANU RAJU, CNN SENIOR CONGRESSIONAL REPORTER: Do you believe the President? When he says he was wiretapped? When he says that he was wired -- when he says that President Obama ordered wiretaps of Trump Tower? Do you believe --

REPRESENTATIVE PAUL RYAN (R), HOUSE SPEAKER: No, as what I've said we've cleared that up. That we've seen no evidence of that.

(END VIDEOTAPE)

KING: Speaker thinks this is -- speaker thinks this is cleared up. They are bringing the FBI director up publicly before Congress on Monday in which he is expected to say publicly, uh-uh, didn't happen. So why is the President saying you're going to just wait a couple of weeks.

TALEV: Yes. Well I think President Trump is moving the goal posts.

[12:45:03] In part because Comey is getting ready to testify. The President himself has got his news conference tomorrow with Angela Merkel. Now he has a way to not answer that other question which is, would you like to apologize to President Obama for accusing him of a crime he didn't commit.

KING: He's going to say, does President Obama want to apologize to Chancellor Merkel for wiretapping her?

(CROSSTALK)

BACON: I might hear that tomorrow.

TALEV: I think with Nunes (ph) and with some of these Republicans, I don't think you're seeing them abandon President Trump. I think you're seeing them trying to help President Trump to stop having to answer questions about this.

BALZ: But he'll maneuver back and forth and back and forth. I mean, in some ways, it's a little like him before the intelligence report came out in early January definitively saying the conclusion was the Russians had hacked and they had done it to help Trump and hurt Clinton. At that point he sort of finally grudgingly seemed to accept the conclusion. And then a few weeks later at his infamous press conference, he seemed to not accept that again. So, he could be kind of backing away from this. But once, let's say Comey goes up and definitively ends this, he can conceivably come back and still raise the question that something nefarious was done that was still -- KING: And we laugh about this sometimes because the individual

bubbles along the road are funny. Some of them are funny. But the credibility of the President of the United States, whatever his or her name is, is pretty important. So I do think if this goes forward, yes, there's some humor, but this is why a lot of these Republicans are frustrated. They keep getting asked about it every day.

Tucker Carlson last night essentially put the defining question to the President. You know, you wouldn't get in some of these messes if you didn't get up early in the morning and go on Twitter. So maybe stop?

(BEGIN VIDEO CLIP)

TUCKER CARLSON, FOX NEWS HOST: Do you talk to anyone before you tweet? And is there anyone in the White House who can say to you, Mr. President, please don't tweet that, who you would listen to?

TRUMP: Well, let me tell you about Twitter. I think that maybe I wouldn't be here if it wasn't for Twitter, because I get such a fake press, such a dishonest press.

(END VIDEO CLIP)

KING: I'm going to stay out of this one.

BACON: I mean, sometimes the tactics that gets you elected maybe are not good in the White House. So like Barack Obama found out that in some ways too. I think that there maybe -- I think he's basically right about social media and working around the media to some extents, although we cover him a lot as well.

Maybe working around the media did help him during the election. He's not sure -- you know, we're in a sort of legislative process now. He's not sure these kind of things help. And I think Paul Ryan would tell him that in these calls they're having every 10 seconds apparently.

KING: United Nations Ambassador Nikki Haley, the former governor of South Carolina. This, again, it puts his own team in a tough position too. She said on NBC this morning, you know, I want him to be successful and these tweets come out. Do I look at them and say, OK, where did that come from? Yes. But I don't pick up the phone and say, what are you doing. I know that's who he is.

BALZ: He is tethered to Twitter. We can see after the campaign, every time he has been asked about, you know, should you clean up your act on Twitter or should you eliminate Twitter -- I mean, he comes back with a version of what he said to Tucker Carlson. I mean, which is, as he put it last fall.

This is a modern form of communication and essentially I know how to use it effectively. And he's going to continue to use it. He's going to continue to create controversies about it and Republicans are -- and people around him in the administration are going to have heartburn as a result of that. KING: And I think the President believes because it works for him in the campaign that his voters love this. Because even if -- forget the specifics of any given tweet, he's talking in a non-PC way, he's disrupting Washington, he's giving us fits, he's giving Republicans and Democrats fits. So the President thinks that works for him.

All right, we're going to take a quick break. Up next, one senator accuses another senator of working for Vladimir Putin. Who is who?

(COMMERCIAL BREAK)

[12:52:57] KING: Welcome back. We're going to close a little differently today to have a little fun. The issue on the Senate floor resolution saying Montenegro should be allowed to enter the NATO alliance. Rand Paul, senator of Kentucky objects. John McCain takes offense.

(BEGIN VIDEO CLIP)

SENATOR JOHN MCCAIN (R), ARIZONA: He has no justification for his objection to having a small nation be part of NATO that is under assault from the Russians. So I repeat again, the senator from Kentucky is now working for Vladimir Putin.

SENATOR RAND PAUL (R), KENTUCKY: I think he makes a really, really strong case, you know, for term limits. I think maybe he's passed his prime. I think maybe he's gotten a little bit unhinged.

(END VIDEO CLIP)

KING: The Senate is the upper chamber, right, whether it's a gentlemanly --

TALEV: They should take a road trip together and make a playlist together?

KING: I think maybe they should just take a long drive.

TALEV: Yes, totally.

KING: Again, we laugh about these things but this lack of civility matters when you're trying to negotiate, right? Legislate?

BALZ: And fascinatingly, President Trump has been talking in recent days about the old Washington, where Democrats and Republicans squabble during the day and went out and had dinner at night and got along and how there's an absence of that and how he wishes that existed. Good luck.

KING: John McCain remembers, though, Washington where Democrats and Republicans did socialize. That the new Republican Party where you have this Tea Party forces like Ron Paul, they view John McCain and Mitch McConnell -- Rand Paul (INAUDIBLE) of his leader. But they view those guys as much a part of the problem if not more so in many cases.

TUMULTY: Well and don't forget John McCain sort of famously a few years back referred to Rand Paul as being in a group of wacko birds. So we're -- there's a continuum here.

KING: Rand Paul has a long memory.

TUMULTY: Right.

BACON: These guys both ran and won in 2016. So I think they also have a little feel a little bit of freedom. If you want to look for the people who take shots at Donald Trump, Rand Paul, John McCain also leading lights among Republicans in that two days, seem to have a little bit of, I don't want to run for six years. I'm going to stay what I want to say and these guys have a lot to say.

[12:55:04] KING: It is -- is the appropriate response to, he now works for Vladimir Putin to say I think he's a little unhinged?

BACON: I don't know what response there is.

KING: What response is there to that?

TALEV: I mean, look, what's so starling about this is that these are both Republicans and you look at what's going on right now. You've got Republicans in charge of both chambers in Congress, you've got a Republican in the White House. This is, obviously, in theory, a time to kind of circle the wagons and get stuff done.

And as President Obama learned with health care, you know, sometimes you just get one shot. If this is the way your party is coming out of the gate, it puts some drag on that momentum.

KING: I'm going to be the optimist in the room. When you have some wins, it's like a bigger thanksgiving dinner. The more family members at the table, the more interesting it gets.

All right everybody thanks for joining us in the "Inside Politics." Hope to see you back here tomorrow. Wolf Blitzer in the chair after a quick break.

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