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Trump's Lawyer Resigns; Massive Spending Bill in House; Farming States on Edge. Aired 12-12:30p ET

Aired March 22, 2018 - 12:00   ET

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

[12:00:22] JOHN KING, CNN ANCHOR: To our viewers in the United States and around the world, welcome to INSIDE POLITICS. I'm John King. Thank you for sharing your day with us.

A busy hour of breaking news ahead, including a big departure in the president's Russia legal team. The top attorney heads out at a fascinating moment.

Plus, the president now just minutes away from slapping big trade tariffs on China. It's an overdue campaign promise, but farm states that voted for Trump will likely get hurt big when Beijing retaliates.

And the House getting ready to vote on a giant spending plan that keeps the government but shortchanges the president's big requests, and, again, leaves the dreamers in limbo.

Let's get straight to the big, breaking news this hour. A big shakeup in the president's legal team. The president's lead counsel in the Russia election meddling probe, John Dowd, has resigned, CNN has now confirmed. That news, first reported by "The New York Times," comes amid public disagreements over the president's legal strategy and just days after the president crossed the threshold, personally targeting the special counsel, Robert Mueller, on Twitter.

Again, this story first reported by "The New York Times." Maggie Haberman part of that reporting team. She joins us on the phone right now.

Maggie, why? We knew there were disagreements. We knew there was tension. Why now?

MAGGIE HABERMAN, "THE NEW YORK TIMES" (via telephone): Because it has become clear that the president is both increasingly keeping his own counsel on almost all matters but -- that includes the Robert Mueller investigation, and because he is looking for a more aggressive approach I think that John Dowd does not believe that going aggressively at the special counsel is a wise move. I think that we have seen repeatedly with people, whether it's on the legal team or whether it's in the White House as staffers, that there's a limit to how much of their personal brands that people want to have damaged in the service of this president. I think Dowd had reached the end of his line.

Now, I think, as is often the case with this president, the president had also lost patience with John Dowd. While it was the president who wanted to go at Mueller this weekend and Dowd complied with that, the president was not really happy with the statement that was given to "The Daily Beast" saying the investigation should end. He saw it as too mealy-mouthed, you know, ham-handed. So he then took matters into his own hands and started tweeting later on. Again, he believes he is his own best messenger.

So the why now is that it is becoming clear this investigation is not going away. This president had been told repeatedly that it would by the end of 2017 or soon after. More subpoenas were dropped recently. The president received -- his legal team received parameters of the questions that Mueller's team would like to ask him in an interview. This is going to go on for some time.

KING: And, Maggie, to that point about the president received the parameters of the questions -- and we know that's another thing that set him off on Twitter, John Dowd's council had been very cautious about that. Let's work with the special counsel. But I don't think you should sit down with the special counsel, Mr. President. With Joe diGenova, a former federal prosecutor, a more aggressive attorney coming onto the team, do we have any indication yet about whether the president's willingness, whether the -- whether the president's now more willing to sit down or not?

HABERMAN: The president goes back and forth between believing that he can essentially sell anyone on anything, that he'd be able to do the same with Mueller, to recognizing that there would be massive dangers in walking into this meeting with Mueller's investigators. You know, there is a -- we hear constantly from Trump's team, you know, Mueller is trying to set a perjury trap. One close Trump adviser said to me privately, the president is a walking perjury trap. He is going to get himself there on his own. And so I think that it becomes more resistant to having an interview and then it sets up the question of whether Mueller would subpoena him in that case, and we'll have to see.

KING: A giant question. We'll see in the days ahead. I know it's a busy reporting day. Maggie Haberman at "The New York Times," appreciate you taking a few minutes to share this break news.

With us in studio here with me to share their reporting and their insights, Eliana Johnson of "Politico," "Bloomberg's" Sahil Kapur, Mary Katharine Ham of "The Federalist" and CNN's Phil Mattingly.

It's a big deal. It's a big turnover. The question is, to what end? We know John Dowd, a more of a serious lawyer on the president's team, Joe diGenova, more of an aggressive public lawyer. Has gone on Fox News and said this is all a setup. The FBI and the Justice Department are trying to frame the president essentially.

What -- what does it tell us about -- John Dowd is leaving -- and I want to also just say for the record, he told our Gloria Borger, quote, I love the president and wish him well. That's what John Dowd said on the way out.

What does it tell us about the president's mindset at a very important moment in this investigation?

ELIANA JOHNSON, "POLITICO": Yes, this is really a pivotal time for Trump and his negotiations with Bob Mueller about whether he's going to sit down for an interview.

What I think is so interesting about this is that John Dowd wasn't unaggressive. In the disagreements between John Dowd and Ty Cobb, John Dowd was the more aggressive one. So Trump has just swapped him out for somebody who is even more aggressive. Doesn't want the president to sit down at all with Bob Mueller.

[12:05:11] My understanding of the debate between the lawyers is that they all have the same goal. They want to try to avoid the president sitting down with Mueller if they can. But if they can't, they want to try to limit the scope of that interview to the extent possible, either to written questions or to a very narrow scope in terms of, you know, a verbal interview. It's their tactics that differ. So I think that's what you're going to see. Joe diGenova taking the lead with a much more aggressive tactics toward Bob Mueller.

KING: It's hard to get any more aggressive than the president, who has said the Mueller investigation never should have begun to begin with.

And as this plays out, Phil, we saw this on Capitol Hill in recent days, incredibly important words from Republicans. First, the number of rank and file Republicans on the Sunday shows. A lot of people criticized the majority leader, Mitch McConnell, saying, what are you waiting for? Why are you being silent? But then when he did speak Tuesday after the luncheon, very clear words. He called Mueller a man of great integrity, said he was going to follow the facts, that the American people would be able to view this with credibility. He chooses his words very carefully, the leader does. That was the message to the president. At this moment now we see chaos and turmoil in the legal team.

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Look, this an uncomfortable moment on Capitol Hill. As you know, the Senate majority leader is not lose with is words. He made it -- he had a very clear point that he wanted to make. Yes, he had been criticized for holding out for a couple of days. But keep in mind, he also backchannels to the White House. He's also pretty close to Don McGahn, the chief White House counsel. So he knows what's going on over there. And his willingness to come out and make that statement I think caused a lot of people in the White House, I'm told, step back and say, whoa, OK. But they also appreciated that because they would like things to be tamped down a little bit.

The fact that this signals I think at least the initial read, that this signals a shift in posture, a posture more along the lines of what we've seen from the president on Twitter over the last couple of days will worry and does worry people on Capitol Hill. They would like him to just leave this be. They're obviously heading into a midterm season. They're obviously heading into a time when they just want to focus on the message, whether it's the tax bill or anything else that they've done over the course of the last 14 months, and this does not lead to that. What this leads to is the types of things that they worry will at some point lead to a constitutional crisis.

KING: Right. And to the point, Maggie made it, Eliana made it, the president's been very aggressive, crossing into a new territory this past weekend in going after Mueller by name. But aggressive from the beginning. Witch hunt. Most of that is political, trying to undermine public credibility of the institutions, public credibility of the investigators.

The question -- legally John Dowd has been very aggressive, you're right, more quietly. If the president -- this is a statement John Dowd issued on Saturday. The question is, if this is not aggressive enough, what is the president looking for?

Here's the statement from the weekend, I pray that acting Attorney General Rosenstein will follow the brilliant and courageous example of the FBI Office of Professional Responsibility and at the Attorney General Jeff Sessions and bring an end to the alleged Russia collusion investigation manufactured by McCabe's boss, James Comey, based on a fraudulent and corrupt dossier.

Now, there are a number of factual things we could challenge in that statement. I'm going to leave that aside. It's -- but that's pretty aggressive there. So if that's not aggressive enough, what is the president looking for, a sledgehammer?

MARY KATHARINE HAM, SENIOR WRITER, "THE FEDERALIST": You know, I wish I knew the answer. I don't pretend to understand his psyche or his legal strategy. But what we do know is, it wasn't Mueller who was fired, but it was a voice for sort of tamping down the public criticism of Mueller. So you've lost that part.

There is a pattern here in this cabinet of here of him sort of straining against his first picks that lead these things and perhaps going with somebody who feels on a more gut level aggressive and more compatible with him. The question is whether that leads him to better outcomes. Sometimes because he's got someone with him that he believes in and believes likes him, or is more compatible with him, he's more willing to listen, but it's real scattershot.

SAHIL KAPUR, NATIONAL POLITICAL REPORTER, "BLOOMBERG": it sure sounds like the president is trying to surround himself with lawyers who have the similar view of this investigation, as he does. I think that's kind of the -- the mindset issue. We saw it when John Dowd was part of the legal team that had advised the president, don't go after Mueller directly, don't go after this investigation, be quite about it, hunker down and we'll beat this. And now we have this new lawyer, Joe diGenova, who has said on Fox News it's -- this investigation is a brazen plot to illegally exonerate Hillary Clinton. He said there are people in the FBI and the DOJ that are trying to frame Donald Trump, unquote.

This suggests that the president views the legal strategy as one in the same with the PR strategy, because is to delegitimize this investigation because whatever happens with the legal issue, it's going to be Congress that probably, at the end of the day, has the final say on this. And he's gone a long way in convincing members of his party, at least, that, you know, to doubt this probe.

KING: Yes. You can say those things on Twitter, and you can say those things on cable news. When you're sitting down for an interview with Robert Mueller and his team, if the president does that, and they have recreated every meeting. They have a timeline of every conversation to the minute detail. It's a little difficult to go off the way they have gone. But we'll see where this plays out.

Again, a big shake-up with the president's legal team. John Dowd is out. We knew Joe diGenova is in. We'll see if there are any other additions and subtractions. Often happens, when one big name goes, you see other shifts as well.

A quick break.

When we come back, the House will be voting soon on a massive spending bill to keep the government open. You see the Democratic leader there on the floor of the House. We'll come back to that.

[12:09:59] We're also monitoring the Dow Jones dropping, dropping. You see it down there nearly 500 points as we wait for the president's big announcement, new tariffs against China.

(COMMERCIAL BREAK)

KING: Welcome back.

More breaking news in Washington today. Just minutes away from a must- pass vote. Minutes behind us, a close call on the House floor. The massive 2,332-page spending bill -- you heard that right -- barely squeaking by a procedural vote a short time ago. Republican leadership hopes that's just a hiccup and not a sign critics might actually be able to find the votes to block it.

Don't bet that more than a handful of lawmakers have actually read the entire plan. Why would that matter? It's only $1.3 trillions of your money.

Some details from the bill, $700 billion in defense spending. $21 billion for infrastructure. $4 billion to help combat the opioid crisis. $2.3 billion for new school safety measures. $1.6 billion for southern border barriers. And the fix NICS bill, as it's called, which (INAUDIBLE) improves by incentivizing states, the federal authorities to report more data into the country's gun background check system. Doesn't expand the purchases covered by the background system. Just improves the existing system.

[12:15:08] The question now, does Speaker Ryan have the votes when this comes to the floor momentarily?

MATTINGLY: Yes, he does. And I think the difference between the procedural vote that we saw that was awfully tight, so tight that they slammed it home before it was actually done, or before everybody had actually voted, these Democrats will be voting for this. And I think that kind of underscores why this bill, so massive, moved in such, I think anybody would tell you, even those who support it, and pretty terribly, ugly process that was very fast and now I think we got it at, what, 8:05 last night and they're going to be voting on it in the House shortly thereafter?

This bill has major wins for both parties to some degree. The speaking on the domestic side is something that people would laugh at you if you suggested this was possible during the Obama administration years.

KING: Right.

MATTINGLY: If -- what you're -- they're getting on the defense side, even the down payment they're getting on the border side, people would laugh at you during the Obama administration years. There's not a lot of cuts. There's not a lot of worry about the fiscal problems. This is all about spending. And that means a lot of people are getting a lot of things they want for their districts and their states. That means it will pass the House and at some point, depending on Senator Rand Paul, will pass the Senate too.

KING: We'll come back to that in a minute. Senator Rand Paul could run the clock out, if you will. Run the procedural clock out possibly past the Friday midnight deadline. We'll see how that goes.

But to your point, you have a Republican president, a Republican House and a Republican Senate and you have a bill that has more spending than Democratic President Barack Obama could ever get sent to his desk by those Republicans in Congress. You figure that one out at home, folks.

Speaker Ryan says we're going to get this passed and he says, in part because the president supports it.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN (R), HOUSE SPEAKER: It will important for me to explain these things. And on big bills that's typically what I do with the president, to walk him through, you know, the contours and the complexities of the legislation we pass. And, yes, he supports the bill, no two ways about it.

(END VIDEO CLIP)

KING: Yes, he does, but listen to conservative Jim Jordan here saying, well, he supported it because it's the only option you gave him. We could have done a lot better.

(BEGIN VIDEO CLIP)

REP. JIM JORDAN (R), OHIO: It's the only bill they put in front of him. Put a good bill in front of the president and he'd support that, too. I know he would. So let's put good legislation in front -- let's not bring the worst bill I have seen in my ten years in Congress to the floor of the House today. Let's put something good in front of the president that's consistent with what the American people elected us to do.

(END VIDEO CLIP) KING: Is that just -- there is a faction of the conservatives who are cranky about any spending bills. Is that all that is? Or is there legitimate frustration that can bubble up to more than that among these conservatives who say, wait a minute, we won the White House, we took back the Senate, we built our House majority, why aren't we being conservatives?

KAPUR: Right. Well, it's mostly that. It's mostly the spending increase that they're upset about. And the fact that there is about $165 billion in military spending increases over two years, that they're OK with. What they're not OK with is about $131 billion in domestic, non-defense spending increases.

The interesting thing to me about the way this bill is written is that it's designed in this vague, sort of inscrutable way where both sides can claim victory on certain things, like there's kind of funding for this gateway project of infrastructure in New York, but there's not really funding for it. There's kind of border wall funding, but it's earmarked in a way that it can only be used for fencing and repairs. I -- presumably the White House knows that.

One thing I -- I note --

KING: Just so I -- forgive me for interrupting --

KAPUR: Yes.

KING: But for those of you watching at home in America or around the world, since we're being simulcast here, just the way you kind of pay your mortgage, or you kind of pay your kids' tuitions, or you kind of pay at the gas station when you get gas. This is why people hate this town.

KAPUR: One thing that's noticeably not in here is a major victory on immigration for either side.

KING: Right.

KAPUR: President Trump does not get his wall. There isn't the $25 billion in there.

What I'm told is that the Republicans made an offer of this kind of three for three, three years of border wall funding to the tune of $25 billion in exchange for a three year temporary protection, no path to citizenship, for the 690,000 people currently enrolled. The Democrats countered and said, we'll give you the $25 billion but it needs to be a path to citizenship for all 1.8 million people who are eligible. The White House said no to that and we're at an impasse.

KING: And so now we're at an impasse on that and Democrats think they can take back the House in November. They think they have a whole lot more leverage then and that math, if they did, would tell you they do.

Is it possible that we're having this conversation today, and we'll watch the vote in the Senate. They'll keep the government running, we assume, that this is the last big act of the first Trump term, if you will? If the Democrats take back the House, the president's going to get even less in any future spending bills, get less in any future debates over the Wall. Is that a fair statement?

JOHNSON: Well, to your question about the conservative criticism of this bill, John, I think the conservative critics have a point. They -- this sort of thing they complained about during the Obama administration and they're being consistent of their consideration in the Trump administration.

The other point I would make is that the budget that the Trump administration recommended, which never holds any water, it doesn't resemble this budget at all. And I think that the president, who's on the phone often to people like Jim Jordan, Freedom Caucus Chairman Mark Meadows, they were ginning him up about this. And he did get agitated. And Paul Ryan speed over to the White House yesterday and had to calm him down. You heard Paul Ryan talk about, he was explaining this to the president. Ultimately, they did get him on board, but it wasn't before he did get upset about the thing. And I think what you ultimately got was Republican getting a win, an enormous increase in military spending, but trading that for also an increase in domestic spending, which is a win for Democrats.

[12:20:08] And, yes, to your question, this will be the last major piece of legislation passed in 2018, no question about it.

KING: And so possibly, if the Democrats take back the House --

JOHNSON: Yes.

KING: Then the president's in a -- the president's in a whole new world then on spending issues and every other issue, including oversight issues.

But, to that point then, he's only getting pennies of what he wanted for the wall. He's only getting pennies for the dollars he asked for in infrastructure. Is the president -- they're briefing at the White House today, saying, we like this bill? You know, it's not perfect but we like it and he'll sign it? Is it possible, like the House health care bill, the more he learns about it, is he going to come out and call it mean? Or if he gets to --

HAM: I think that is always possible.

Look, this is how bipartisan, unfortunately, works, especially when you're not following a budget process and we're this dysfunction. It is fast, ugly, expensive and sometimes dishonest. Yeah, we have a bill!

So there's going to be a lot of problems with it and he will find something to be mad about if he wants to be mad about it.

KING: Yes.

KAPUR: And could I just note, there are two really interesting provisions of this bill that are not getting enough attention. One is essentially clarifies a 22-year-old amendment that prevents the CDC from researching gun violence. That is a significant victory for gun control advocates who believe that if you have that research out there, it will create a compelling case for new gun restrictions.

The other is a fix to the tax law, the so-called gain glitch that disadvantages agri business. Democrats acquis to that. That's a big thing because they're not -- it shows that they're not following the Republican strategy of refusing any technical corrections, refusing any fixes like they did with the ACA and making them -- making people feel the pain of their mistakes. Democrats are going along with this.

KING: That's back in part because of some red state Democrats on the Senate ballot this year, just a guess.

Next up for us, President Trump could start a global trade war in the next few minutes. And the Dow is down nearly 400 points. And, guess what? The market's following the president's tough talk on trade.

(COMMERCIAL BREAK)

[12:25:56] KING: Welcome back.

Just moments away now from a very big announcement. The president will announce a series of new trade tariffs against China. Here's a spoiler alert, they're expected to be quite harsh, to the tune of perhaps $50 billion, maybe more. Wall Street, of course, nervous about this. Investors, excuse me, clearly worried about a possible trade war. You see now 361, 363 points. The Dow was down almost -- more than 500 points at one point as we wait on the president here.

Beijing has made it clear it doesn't want a trade war. But it also says it's prepared to retaliate if the president starts one. Team Trump says this isn't about fighting, it's about fairness.

(BEGIN VIDEO CLIP)

PETER NAVARRO, WHITE HOUSE NATIONAL TRADE COUNCIL DIRECTOR: Talk is not cheap with the Chinese. It's actually been very expensive. Because while we've been talking with them since 2003, they've been robbing our technology blind.

All we want, Maria, is fair and reciprocal trade. And I think the American people deserve that. And they finally have a president who's going to give that to them.

(END VIDEO CLIP)

KING: The president did promise this during the campaign. And if you asked him about it and his team about it he thinks -- one of the reason he won Pennsylvania, won Michigan, won Wisconsin, flipped those traditional blue states red, is that he talked to people in manufacturing and he says, I know you guys are getting screwed by trade. I'm going to do something about it. So he's going to do something about it today.

The question is, a lot of people had hoped to talk him out of it because they think it's both bad policy and bad politics. What's going to happen?

KAPUR: I mean this was a huge part of the campaign. Everywhere I went dozens and dozens of Trump rallies, people brought this up over and over again. I think this and the issue of immigration were, you know, the two issues that made him the Republican nominee and eventually president.

He can say -- you know, the White House can say they don't want to fight, but they are courting a fight with this. You don't go after 10 percent of Chinese exports through the United States without a retaliation.

The irony of trade politics, I will say, the, you know, complicated thing about this is that the down side are very well understood. You know, shuttered plant. You know, you look at a plant in your home -- in your neighborhood that's shut down and jobs lost, you make the connection to trade.

But the other -- the positives are not well understood, which is cheap goods. How many people, when they go to Walmart, Americans, buy cheap goods from Walmart make the connection, this is because of free trade?

KING: Or how many people who live in the farm states. This, you have to look at again. You look at the map of the United States. We're sitting in Washington, D.C. We're almost not qualified to talk about this. We don't have farms here. You know, but if you go out -- and here's what they're worried about. Look at the headline of "The Des Moines Register" today, "Iowa farmers hope China's need for soybeans will save commodity from trade war." Let's look at the -- let's go through these, soybean producing states first. You'll see the top five here. Three of them carried by President Trump in the last election.

So is the president, in keeping a promise, is he hurting himself down the road if he effects the economies in those states? Top pork producing states. Of the top five, three of them, Iowa, North Carolina, Indiana, carried by President Trump in the last election. Top sorghum producing states, Kansas, Texas, Oklahoma and South Dakota. Four of the top five carried by Trump.

So in keeping a promise, is the president potentially hurting himself politically?

MATTINGLY: Well, it's worth noting that Chinese officials -- unnamed Chinese officials weren't timid about leaking out to publications that those were exactly the products and those were exactly the states intentionally that they planned on hitting when they decided to fire back.

Look, I think you have to -- we talked about this a lot with the steel tariffs and the aluminum tariffs, which is obviously different in terms of scope and scale and targeted approach when it comes to going after China. But this is what the president promised. This is what the president said he was going to deliver. And while he's going much bigger than I think people on his staff wanted and I think even some of the kind of China hawks on trade policy on The Hill wanted, he said he's going to do it, and he hasn't seen, at least to this point, major repercussions to anything that he's done despite what people have warned him about.

KING: Right.

MATTINGLY: And I think you can't underplay the fact that everybody seems to amp everything up to 10 or 11 whenever he makes an announcement, whenever he decides to move forward on a policy. And if it only hits a four or a five, he's going to sit there and go, this is everybody screaming and crying and it never (INAUDIBLE).

JOHNSON: And that's exactly right.

KING: Right. And it's just like him winning the election.

MATTINGLY: Yes.

KING: He thinks he's right. I'm president and you're not.

MATTINGLY: Yes.

KING: I'm right and you're all wrong.

JOHNSON: Well, you also, since he's become president, he's had advisers tell him, you can't move the embassy from Tel Aviv to Jerusalem. Wars are going to begin throughout the Middle East. Americans are going to die.

You had him -- you had the same people telling him he couldn't withdraw from the Paris Climate Accord. It was going to be terrible. And this is why he was happy to shut down the government. He simply didn't believe these cries that it was going to cause a major crisis.

[12:30:10]