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Stocks Slide on Trade War; Update on YouTube Shooting; U.S. Troops in Syria; Aired 12-12:30p ET

Aired April 04, 2018 - 12:00   ET

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

[12:00:00] BRIANNA KEILAR, CNN ANCHOR: There in san Bruno that Kyung's talking about.

Kyung Lah, thank you so much.

And thank you for joining me. "INSIDE POLITICS" with John King starts right now.

JOHN KING, CNN ANCHOR: Welcome to INSIDE POLITICS. I'm John King. Thank you for sharing your day with us.

President Trump tells his national security team he wants to get U.S. troops out of Syria. But, and it's a big but, he agrees to leave them there for now after being warned ISIS and Iran would be the big winners if they leave too soon.

Plus, new tariffs in a growing U.S./China trade skirmish, and new turmoil on a very nervous Wall Street.

And is this glass half empty or glass half full? Should the president now answer questions from the Russia special counsel after being told he is not, at this moment, a target. But, big but again, that his conduct as a candidate and president remains a subject of the investigation.

(BEGIN VIDEO CLIP)

REP. TREY GOWDY (R), SOUTH CAROLINA: I do think he should sit down with Special Counsel Mueller. I think he's uniquely well positioned to answer some of the questions that not just special counsel but also the American people have. So I would tell you, if you did not rob the bank, there's no reason for you not to sit down and talk to the FBI about the bank robbery.

(END VIDEO CLIP)

KING: Want to let you know as we begin the hour, also moments away from a police update on that shooting at YouTube headquarters outside of San Francisco. We will take you there live when that briefing begins.

First, though, to the turmoil in Washington and on Wall Street. A volatile day for stocks. The Dow is down, you see it right there, 144 points as we begin the noon hour here in Washington. The slide was just shy of 500 points in early trading. Investors clearly rattled by a growing trade fight between the United States and China.

Beijing is firing the latest salvo, slapping new tariffs on more American products, including airplanes, automobiles, and soybeans. That was a second counterpunch. Each following new tariffs announced by the Trump administration.

Now, the president insists in a morning tweet, quote, we are not in a trade war with China, but that he has to make up for past, in his words, foolish or incompetent trade decisions by past administrations. The markets, though, clearly do see the disruptive trade war, or at least the imminent threat of one.

CNN Money's Cristina Alesci down on the trading floor watching all this anxiety play out.

You're having an interesting day, Cristina. Give us the latest.

CRISTINA ALESCI, CNN MONEY AND POLITICS CORRESPONDENT: That's right. The markets clearly do not care about semantics here, even though the administration and its officials are trying to tamp down any discussions of a technical trade war. The markets definitely perceive like we could be heading for one. And now we're paring some of the losses that we saw earlier today. And that's probably because the administration unleashed a couple of its officials to kind of talk about how this is a process.

We had the head of the National Economic Council out there talking about the fact that this is a process and that there's a pot of gold at the end of the rainbow. You know, Wilbur Ross was out there talking about how shooting wars often end in negotiations. So they're clearly trying to mitigate the anxiety, but it's not really working.

Look, the U.S., at this point, is picking a fight, mind you, with its largest creditor. You know, we borrow a lot of money from China. And this is something that many people don't talk about. But on the floor here, traders and smart investors see this as picking a fight with someone we need -- we need for our financial health. And that's really the issue here. So it's unintended consequences. It's the idea that we really don't know how this will play out, and that's what's causing the anxiety. And that's -- we're probably going to see this volatility over the next couple of weeks and possibly even months, John.

KING: As we wait to see if we get over that rainbow, I guess.

Cristina Alesci, thanks. Continue the interesting day there.

And it's not just the markets that are nervous. Republicans worry the America-first impulses that helped the president to his big 2016 win will hurt them in 2018 by wiping out the market gains, slowing economic growth, and disrupting industries in states and districts critical to the midterm election battlefield. Team Trump insists its critics on Wall Street and here in D.C. are overreacting.

(BEGIN VIDEO CLIP)

WILBUR ROSS, COMMERCE SECRETARY: This 50 billion that they're talking about amounts to about three-tenths of a percent of our GDP. So it's hardly a life-threatening activity.

LARRY KUDLOW, WHITE HOUSE CHIEF ECONOMIC ADVISER: There's to trade war here. What you've got is the early stages of a process that will include tariffs, comments on the tariffs, then ultimate decisions and negotiations. There's already back-channel talks going on.

(END VIDEO CLIP)

KING: With me to share their reporting and their insights today, CNN's Dana Bash, Karl Hulse of "The New York Times," Greg Ip of "The Wall Street Journal," and CNN's Abby Philip.

So are we in a trade war, or are we just debating a trade war? I guess the bigger question is, I don't think there's anybody who doesn't view China as a cheat and China as a bully in the international marketplace. The president has every right, every reason -- he campaigned on getting tough and responding. Is in the right way to do it?

GREG IP, CHIEF ECONOMICS COMMENTATOR, "THE WALL STREET JOURNAL": So I think that's important. The action the president is threatening with China is a very different animal from what we saw with, for example, with NAFTA, with Korea, with the steel and aluminum tariffs. In those situations, Congress, other countries, business, they were very much opposed to what the president was doing. They saw this as unwarranted action against U.S. allies.

[12:05:19] By contrast, virtually all those same groups, Congress, business, allies, believe that China is a bad actor. Maybe there's a trade war here, but China started it.

So that brings the next question, is this the right way to approach it? The president campaigned on this. Campaigned -- he threatened about it. But there are important nuances here to keep in mind. First of all, it's not a trade war yet. We're just at the stage of mobilizing the troops. Both China and the United States have announced tariffs. They have not implemented them. And the reason why, that is to allow room -- time for the negotiation process to work its way out.

At the end of the day, both China and the United States have very strong incentives not to actually allow the trade war to break out. That alone I think driving towards some type of an accommodation.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: And that's something that people who have known Donald Trump and worked with him and observed the way he operates for some time remind me all the time, which is, he goes big, he has big threats, he -- whether it's a negotiation, he offers, you know, he offers the moon, plus, plus, whether it's something like this, he -- you know, he -- his M.O. is to scare the negotiating partner into coming to the table. So the rhetoric now is part of that.

The danger is, this isn't just a real estate negotiation. This is a negotiation that moves markets in a very significant way. And so it's the most risky kind of Donald Trump M.O. that -- KING: Let me flip to real estate analogy a little bit because if you're Mitch McConnell, if you're Paul Ryan, you're the Republican leaders in an already very difficult election year, the president's first midterm is always a bad year for the party in power. We've seen in the special elections -- we'll get to some of those later today -- the Democratic intensity. So maybe, in the end, maybe in four months or six months.

The question is, what turmoil does it cause in the short-term? Let's just look up here. Soybean states, for example. China announced new tariffs on soybeans. Look at this map of where soybeans are produced in the United States of America. Just on this map alone, that's the broad tariffs. You see all the different tariffs China has imposed. And that's a lot. That's beef. That's airplanes. That's automobiles. That's pork. That's wine. You look here. That's soybean country. Soybean producing areas in the United States.

We have counted, by CNN's count, at least a dozen Republican-held seats in that shaded area that are in place in this election year. So if you're a Republican and you're not thinking about the economics, or you're not thinking about what it's going to look like a year from now, you're thinking about November.

Carl Hulse, and I'll just read you from the majority leader. Now, those are House districts. He's the senator. He said this back in Kentucky yesterday. I'm not a fan of tariffs, and I'm nervous about what appears to be a growing trend in the administration to levy tariffs. This is a slippery slope. So my hope is that this will stop before it gets into a broader tit-for-tat that can't be good for our country.

He says our country. He also means his party.

CARL HULSE, CHIEF WASHINGTON CORRESPONDENT, "THE NEW YORK TIMES": The Chinese have someone who's a pretty good political analyst because that is an interesting place to pick to make their point, right, that part of America with the elections that are coming up. I agree that there's a lot of people in town who think China has asked for this, but there's going to be some pain involved. And, you know, the problem for the Republicans right now is, this election is seven or eight months away, and this is stepping all over their tax cut message.

You know, the president has spent the last week or so on immigration. And now he's in the middle of these -- this trade dispute. And I think what you see from Mitch McConnell is a little bit of a concern that this is going to really come back and get them. And I've -- all -- everything that I'm hearing from Republicans who are home right now and watching what's going on is the message is bad for them. And this is not helping.

ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: I mean, and the original fear that Republicans had was the slippery slope, as McConnell noted. And President Trump has injected so much volatility in the market, at least in the short-term, there is a fear that this economic moment that they're experiencing could be jeopardized by a series of rash economic decisions the president is making because he wants to say that he's fulfilling certain promises, but economists say it's bad policy.

I mean we're in a state now where we're looking at maybe a market correction at the moment, but people are actually losing money. People's 401(k) values are going down. People are starting to wonder again about what could happen to the money that they've -- the hard- earned money that they've saved. So they're -- they were going into November with tax cuts on their plate and now they have this wildcard that President Trump has thrown in there and they don't want to continue with that risk where that may be the only really great thing going for them this midterm.

KING: Right. And let's just show -- we have a chart of the Dow Jones over the past year. President Trump loved to brag in 2017 about how the market was. And he had every right to brag. The market was going up and going up.

Look at the volatility and the drop in recent years. That's the problem for Republicans. They want to talk about tax cuts. They want to talk about economic growth. You have this happening. You may have some industries in specific districts, whether it's beef, whether it's pork, whether it's soybeans, whether it's others. So it's a test because one trademark of the president, as Dana noted, is he disrupts. He tweets. He scares people. He disrupts everything, politics, world markets. It's a test for his team.

[12:10:07] Larry Kudlow is new on the job as the president's chief economic adviser. Cristina noted at the top of the show, he just talked about some -- there's a rainbow out there where on this rainbow and on the other side there's a pot of gold. Here's another way Larry Kudlow characterized where we are right now.

(BEGIN VIDEO CLIP)

LARRY KUDLOW, WHITE HOUSE CHIEF ECONOMIC ADVISER: Any time you lower barriers, any time you lower barriers, and that's the key -- the president will say this -- lower barriers is the key. Don't raise the barriers. Any time you do that, it's good for growth. It's good for American growth and American workers. It's good for China growth. It's good for the rest of the world's growth. And that's the intention here.

(END VIDEO CLIP)

KING: If that's the intention, why are we raising barriers? When you -- when you impose tariffs, please help me if my language is wrong, you're raising barriers. You're making it harder or you're making it -- your having a tit-for-tat. So does he actually think that by raising them now or threatening -- they haven't taken effect -- by threatening to raise them now that ultimately we're going to lower them, or is that just spin?

IP: No, but everybody knows that in a negotiation you have to be prepared for your side to accept some pain to get what you want. If there is a consensus, and I believe there is one, that China's behavior needs to change, the United States has to actually express a willingness to accept some pain, such as a selloff in the market you're seeing today in order to get its way. Once again, the theory of the case is that we don't actually get to that point.

The Chinese have a lot to lose here. The exports that they are being hit with tariffs on are more important to them than the exports they're hitting that are important to us.

KING: I need to interrupt you, unfortunately.

I want to take you out to near San Francisco now. Police giving an update on that shooting yesterday at YouTube headquarters. Let's listen.

CHIEF ED BARBERINI, SAN BRUNO, CALIFORNIA, POLICE: Three of those four were suffering from gunshot wounds. Following an initial search by San Bruno officers to identify any immediate threats, a perimeter was established by responding allied agencies. And tactical teams conducted an extensive search of the entire campus located at 901 Cherry Avenue. No other suspects were located, nor are there believed to be any additional suspects involved in this crime.

Aghdam had been reported missing by family members to the San Diego Sheriff's Office on April 2nd. She had been reported to have been missing since March 31st.

Early on the morning of April 3rd, Aghdam was located by the Mountain View Police Department and removed from the state's missing persons system. Currently, there is no evidence linking Aghdam to any individuals at the scene at the time of this incident. A Smith & Wesson 9mm semi-automatic handgun registered to the suspect was recovered at the scene. Investigators also learned that the suspect went to a local gun range yesterday -- yesterday morning prior to visiting YouTube.

The processing of the crime scene has been concluded up there on Cherry Avenue. San Bruno investigators, with the assistance of ATF, are in the process of executing search warrants at two residences in southern California believed to be associated with our suspect. The suspect is believed to have parked her vehicle to the rear of a neighboring business and accessed the campus via a parking garage. The suspect's vehicle has been secured and is expected to be processed over the course of the next few days. Investigators will also be working to gain access to and review all social media related posts associated with the suspect in an effort to further comprehend the motive for this crime.

At this point in the investigation, it is believed that the suspect was upset with policies and practices of YouTube. This appears to be the motive for this incident.

I'd very much like to thank and recognize the numerous local and federal agencies who provided assistance in managing this incident. YouTube's response to this critical incident was also extraordinary. They were extremely prepared to offer services to all of their employees in a swift and timely manner. This would have been much more challenging for us without all of their assistance.

Finally, I'd like to mention how proud I am of the San Bruno police officers, especially those who were first on scene. Not only the timeliness of their response, but the actions they took as they responded significantly limited the window of time available to the suspect to cause harm to additional victims.

Our department has worked to be as open and transparent as possible in sharing information regarding this incident and will continue to strive to do that. However, from this point forward, the investigation is expected to be very deliberate and methodical. I do not anticipate having additional information in the immediate future to share. When we do develop additional information, we'll let you know, and we we'll distribute that.

So, with that, before addressing any questions, I'd like to introduce the fire chief, Dave Cresta (ph), to summarize and describe the fire and EMS response to this incident.

Chief.

CHIEF DAVE CRESTA (ph): Good morning.

As the chief said, I'd like to just go over the fire --

KING: You're just listening there to Chief Ed Barberini, the San Bruno California Police Department, talking about his agency's response yesterday to the shooting at YouTube headquarters. The shooter was killed in that. Three people were injured, one of them in critical condition still.

Let's bring in CNN law enforcement analyst James Gagliano. He's a retired FBI supervisory special agent.

James, as you listen to that, they say the crime scene has been resolved and processed. What was the biggest -- your biggest takeaway and the biggest question as we go forward?

[12:15:03] JAMES GAGLIANO, CNN LAW ENFORCEMENT ANALYST: John, there wasn't really any new news there, I mean other than describing the type of pistol that she had and the fact that she had gone to a range that morning to ostensibly practice.

I think what's striking, I mean, we assume that there was some type of grudge there. Often workplace violence involves somebody with some type of grievous feeling like they've had something done to them. In this instance, she felt that YouTube had not been properly compensating her or manipulating the numbers of views. So there's a treasure-trove of digital footprinting here. So I'm sure that the FBI and the locals are going through that.

I think what stands out to me here, and I went back and did a deep dive into active shooters and the statistics related to them that the FBI compiles from 2000 to 2016. And over the course of that 17 years, John, I mean, just think about these numbers. There have been 220 of these type of attacks. Women make up 50 percent of our population, and they generally commit about 6 percent or 7 percent of the murders. When it comes to mass shootings, it drops even lower than that. They're only 3 percent of the mass shooters. So this was truly an anomaly in the sense that, yes, we understand

that she had some grievances against YouTube. Her background, as you try to put the pieces together, she just didn't fit into any of the typical kind of slots that you would have put her into. So I think the investigators will continue doing a deep dive. The biggest concern is, were there anybody that was involved in this as an accomplice, whether it was witting or unwitting, and how was she able to purchase the handgun?

KING: That's a fascinating statistic about women active shooters.

James Gagliano, appreciate your insights. Smart insights there.

GAGLIANO: Thanks for having me.

KING: I appreciate that.

Up next for us, the president publicly is clamoring to get U.S. troops out of Syria, but, in a private meeting with his national security team, he says they can stay, for now.

(COMMERCIAL BREAK)

[12:20:58] KING: Welcome back.

President Trump making a big concession on Syria. A senior administration official telling CNN the president told his national security team he's willing to keep U.S. troops in Syria on a short- term basis. Now, the official says the president did tell his advisers he wants a withdrawal plan ASAP, but agreeing to stay for now is a startling turn, especially if you listen to the strong public statements yesterday that caused a big stir at the Pentagon.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: And as far as Syria is concerned, our primary mission in terms of that was getting rid of ISIS. We've almost completed that task and we'll be making a decision very quickly.

I want to get out. I want to bring our troops back home. I want to start rebuilding our nation.

BRETT MCGURK, SPECIAL PRESIDENTIAL ENVOY FOR GLOBAL COALITION TO DEFEAT ISIS: In terms of our campaign in Syria, we are in Syria to fight ISIS. That is our mission. And that mission isn't over. And we're going to complete that mission.

(END VIDEO CLIP)

KING: Molly Ball joins the discussion now. Molly -- from "Time."

That was Brett McGurk, an adviser to the administration on fighting ISIS. That was within three minutes of each other. The president of the United States saying, I want to get out. His adviser to fight ISIS saying, we need to stay in. The president has agreed. We're told in this private meeting to stay for now.

But there's this tension between his -- his sort of America-first, noninterventionist instincts and what the generals are telling him is, if you leave too soon, we will pay a price.

MOLLY BALL, NATIONAL POLITICAL CORRESPONDENT, "TIME": That's right. And, you know, I think this is one of many areas in which Trump, as president, has found the reality much more complicated than his very simplistic promises on the campaign trail, whether you're talking about tariffs or health care or anything else. And what we've also seen is especially in the national security arena, his advisers have tended to rule the day. He has been surrounded by pretty much conventional Republicans who are continuing the sort of national security strategy I think you would have seen under a President Ted Cruz or a President Jeb Bush and trying to temper some of his more extreme instincts, saying you can't just, you know, jerk the troops out like that, even getting him to bomb Syria at one point, which is something that he really decried on the campaign trail.

So -- and in all of these areas, in every area of policy, even, you know, the border, Trump's lack of focus means that it's pretty easy to sort of distract him and implement whatever you actually want to do if you're in the administration. And so he -- you know, he sort of tweets all he wants, and I think people around him don't necessarily take the tweets as definitive policy statements because they know that they can sort of maneuver him behind the scenes.

KING: And yet it's clearly his impulse and his instinct. And if you remember during the campaign, he criticized President Obama. He repeatedly criticized candidate Hillary Clinton, saying, you know, you guys created ISIS because you left Iraq too early. It was your -- you pulled out and look what happened.

Now, Marco Rubio tweeting at the president, trying to remind him of that, essentially saying, cautioning against leaving Syria too soon is not about being hawkish. It's about the fact that if we leave too soon, and without a plan, we leave behind a vacuum that will either make Iran and Hezbollah stronger or lead to a resurgence of ISIS.

The question is, will the president listen.

BASH: I think the best analogy to this is Afghanistan, which is another place where he said he wanted to bring troops out. It was too long. It's an endless war. It's an unwinnable situation there. And he agreed to add troops to Afghanistan. And it is -- was an early indication that he was willing to listen to the hawks that tend to rule the Republican Party.

KING: Will that continue under this alleged new Trump?

BASH: Unclear.

KING: New Trump, where he's alleged making his own decisions, not listening to advisers so much.

BASH: So it's unclear because the idea that you just mentioned of pulling out of Iraq too early can definitely be said for Afghanistan. I mean that's where the -- you know, that's where bin Laden was. So you can say that about a lot of these hot spots, which is why you have the, you know, Lindsey Grahams and John McCain's and that wing of the party begging the president not to pull out of all of these areas.

KING: And they think he needs help because you have Tillerson gone, McMaster on his way out. So the Marco Rubios and the Lindsey Grahams think that Secretary Mattis needs a little reinforcement.

I'm sorry.

PHILLIP: The reality is Trump has always been pretty ideologically inconsistent about this very issue. He, on one hand, will often say, we need to get out of foreign wars, and then, on the other hand, say we need to toughen up and dig deep and be tougher on ISIS than Obama and Hillary Clinton were.

[12:25:12] Those two things do not always work together. And we're seeing that right now in Syria. For the president also in the Syria situation, he is being pulled back in part because he kind of impulsively announced these things when his administration was in no position to act on them or to deal with them. And at one point he had said, I'm not going to telegraph what I'm going to do when it comes to military action. And that's exactly what he did. It made -- it actually, in this case, made it much easier for his advisers to say, hey, Mr. President, it's too soon to do this. And suddenly you had Turkey calling, you had -- you know, you had France calling, everybody calling him trying to get him back on the straight and narrow on the issue of Syria.

KING: Just yesterday -- to the point you're making -- just yesterday we were going to send troops to the border. The Pentagon couldn't explain that. We're getting out of Syria as soon as possible. The Pentagon couldn't explain that.

And then there was this. The president, at this press conference with the three leaders from the Baltic nations saying, as he considers his decision in Syria, he's talking a lot to Saudi Arabia.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Saudi Arabia is very interested in our decision. And I said, well, you know, you want us to say, maybe you're going to have to pay. But a lot of people, you know, we do a lot of things in this country. We do them for -- we do them for a lot of reasons. But it's very costly for our country. And it helps other countries a hell of a lot more than it helps us.

(END VIDEO CLIP)

KING: Let me just say as a semi-student of the region, is there anybody in this town, is there anybody in the world who thinks Saudi Arabia is, a, going to pay for Syria, b, maybe put some of its own troops at risk in stabilizing Syria? Is there anything in the history of the last 30 years that suggests that that's even remotely a possibility? HULSE: No, I don't -- I don't think so.

I think, you know, that the president seems to me, he's sort of satisfied just to express what he would do. And this is -- it's reassuring his base. You know, here's what I really want to do. I'm being held back by all these experts around town. Even though he once said I know more than the generals, he finds himself having to listen to them.

And I think this is, again, a reflection of the feedback that Republicans are getting. You know, there's real unhappiness at home with signing that big spending bill. And so Trump's trying to send these signals. Well, this was what I would do. This is what I would do. And then, of course, he kind of looks weak when it turns around and he can't do it and his own people are overruling him pretty dismissively --

KING: You say, this is what I would do if I were president, except he's --

HULSE: Right. Right.

BALL: If I were these people's bosses.

KING: Yes, again, because he's fond of telling people, he's president and they're not.

HULSE: I -- maybe it's a strange theory, but I kind of -- I see that happening.

BALL: No, I think it's exactly right. I mean you talk about there being a new Trump. I don't think there is any new Trump. He's behaving exactly as he has throughout his term so far.

What would really be a new Trump would be somebody who focused and enforced the things that he had expressed that he wanted to do.

KING: Stay tuned.

When we come back, Robert Mueller tells the Trump team that the president is not a target of his probe, but at least one report says he is a subject. Is that really much better?