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State of the Union

Will Trump Fire Man Investigating Him?; Interview With Alabama Senator-Elect Doug Jones; Interview With Treasury Secretary Steven Mnuchin; Transition Accuses Mueller Of Improperly Obtaining E-mails; Gillibrand Fires Back At President Trump's Tweet; Andrea Ramsey Drops Out Of Kansas Race; "You're Fired" In This Week's "State of the Cartoonion". Aired 9-10a ET

Aired December 17, 2017 - 09:00   ET

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

[09:00:07]

(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN ANCHOR (voice-over): Will he pull the trigger? A prominent Democratic congresswoman says rumors are swirling on Capitol Hill about the Russia investigation.

REP. JACKIE SPEIER (D), CALIFORNIA: I believe that the president wants all of this shut down. He wants to fire special counsel Mueller.

TAPPER: This as a lawyer for the Trump transition team questions whether the investigation is tainted.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: There is absolutely no collusion. I have nothing to do with Russia.

TAPPER: Will the president fire Mueller? Will he pardon Flynn?

Plus: tax plan revealed. And Republicans appear to have the votes they need to pass it.

TRUMP: We're very, very close to a historic legislative victory.

TAPPER: Who wins and who loses in the new bill? We will discuss the details with Treasury Secretary Steve Mnuchin next.

And Senate upset. Democrats get a big win in deep-red Alabama.

DOUG JONES (D), ALABAMA SENATOR-ELECT: I am truly overwhelmed.

TAPPER: Could be this the start of a Democratic wave? And what does it say about the president's base? Alabama's next senator, Democrat Doug Jones, joins me live in moments.

(END VIDEOTAPE)

TAPPER: Hello. I'm Jake Tapper in Washington, where the state of our union is on edge to see how far the president is going to go. This morning, lawyers representing President Trump's transition team

are accusing the special counsel of obtaining unauthorized access to tens of thousands of presidential transition e-mails.

In a new letter to Congress, the transition lawyer claims such a move taints the investigation, and it comes as rumors are increasing that President Trump may be contemplating firing the special counsel, Bob Mueller.

Late Saturday, a spokesman for the special counsel's office released a rare response, saying -- quote -- "When we have obtained e-mails in the course of our ongoing criminal investigation, we have secured either the account owner's consent or appropriate criminal process" -- unquote.

As soon as this week, President Trump's lawyers are set to meet with the special counsel.

The new developments have the potential to distract from the Republican focus this week, passing their $1.5 trillion tax cut and delivering President Trump his first major legislative victory of the year.

Here with me to discuss that is Treasury Secretary Steve Mnuchin.

Secretary Mnuchin, thank you so much, as always, for being here.

STEVEN MNUCHIN, U.S. TREASURY SECRETARY: Thank you. It's great to be with you.

TAPPER: So, we will get to taxes in one second, but I do want to ask you about this lawyer -- sent to members of Congress from President Trump's attorneys for the transition accusing Mueller of obtaining unauthorized access to tens of thousands of e-mails from the transition.

The letter says the investigation is now -- quote -- "tainted." And many legal experts suggest this could be a pretext, setting the stage for the firing of Mueller.

Would it alarm you if President Trump fired Mueller?

MNUCHIN: I haven't heard the president -- I was with the -- at dinner last night with the president and vice president. I haven't heard anything about this, any firing.

But we have got to get past this investigation. It's a giant distraction. Nobody has said that in any way this impacted the outcome of the election.

TAPPER: But when you say you got to get past it, you think it should run its course?

MNUCHIN: I think it should be over quickly, since I think there is nothing there. It should be over quickly, and people want to focus on other things. TAPPER: But does that include the president firing Mueller, when you

say you want it over quickly, or should it be allowed to run its course?

MNUCHIN: I don't have any reason to think that the president is going to do that, but that's obviously up to him.

TAPPER: Let's turn to taxes.

As he was leaving for Camp David yesterday, President Trump touted the new Republican tax bill as a big win for the middle class.

Take a listen.

(BEGIN VIDEO CLIP)

TRUMP: This is going to be one of the great gifts to the middle- income people in this country that they have ever gotten for Christmas.

(END VIDEO CLIP)

TAPPER: The tax bill just landed on Friday, so a lot of people don't even know what's in it.

Maybe you can help us. What percentage of this tax cut is going to people who make, say, around $200,000, $250,000 a year?

MNUCHIN: Well, this is really historic. This is the biggest single change to the tax system, in fixing a broken tax code, that we have ever had.

A family of four making $75,000 will get about a $2,000 tax cut, and a family of four making $150,000 will get almost $4,000.

Plus, we think, as a result of lowering business taxes, wages will go up. So, this is a huge opportunity for creating jobs, creating tax cuts for working families.

TAPPER: But do you have any idea what percentage is going to people who make less than $250,000, less than $200,000 a year?

Because I understand that there is a huge tax cut going to corporate America, and I understand that every tax bracket is getting a tax cut. But what percentage is going to the middle-income people that President Trump keeps talking about?

MNUCHIN: Jake, the number is very complicated, and different people will present it different ways.

As you know, there are distribution of taxes. The distribution is staying very similar. And this is all about fixing a broken tax system. So this will be very large tax cuts for working families and very large tax cuts for businesses to make them competitive.

We have a broken business tax system. We had one of the highest rates in the world. We're coming down to 21 percent, very competitive. And, more importantly, we're going from a worldwide broken system to a U.S., job-centric system that's going to bring trillions of dollars of cash back here to be invested here.

[09:05:11]

TAPPER: One of the biggest changes from the House and Senate proposals is that the final plan lowers the top tax rate for individuals from 39.6 percent to 37 percent, and it raises the threshold at which the top rate kicks in to $600,000 for married couples.

The bill also raises the threshold for the estate tax to $11.2 million.

Take a listen to something President Trump said in September.

(BEGIN VIDEO CLIP)

TRUMP: The rich will not be gaining at all with this plan. We're not -- we're looking for the middle class, and we're looking for jobs.

(END VIDEO CLIP)

TAPPER: Obviously, the middle class is getting a tax cut. You outline that way, but to say the rich will not be gaining at all with this plan, I don't see any way in which that is true.

MNUCHIN: Well, Jake, let me explain to you how that is true, because we're getting rid of lots and lots of deductions.

The biggest is, we're capping state and local reductions at $10,000. So one of the things we were very sensitive to is the high-tax states make up a big part of the economy. So, even lowering the top rate from 36.6 to 37, in the high-tax states, actually, rich people taxes will be going up.

And the reason why we lowered the top rate is because we're very sensitive to that's a very large part of the economy. But the president was right. There are people who are rich people that are having their taxes going up.

TAPPER: According to "The New York Times," low-income families who claim the Earned Income Tax Credit would lose out on this bill to the tune of $19 billion over the next decade because of the new way tax brackets are indexed to inflation.

Essentially, by adopting this method, it doesn't increase as quickly. The proposal makes it so people will enter the high tax brackets faster.

So, if this is a plan that will help people keep more of their money and will help lower- and middle-income people, why include this provision that will ultimately hurt lower- and middle-income Americans, at the same time that corporate America is getting this huge tax break? MNUCHIN: Jake, you're just looking at one little part of the bill,

and you have got to look at the bill overall.

So, for low-income people and middle-income working families, their taxes are going down. Their tax credits are going up. The child tax credit is going up significantly. So they're getting big tax cuts. That's what this is all about.

TAPPER: But the Earned Income Tax Credit, but the chained inflation part of that, that's going to hurt them down the road.

MNUCHIN: As I said, you're looking at one component of it, and you have to look at the total package that they're getting.

And they're getting significant tax cuts.

TAPPER: The Treasury Department, your department, released some analysis this week claiming the tax plan will pay for itself; not only that, it will raise almost $300 billion in new revenue.

The analysis was criticized, even by some conservative economists, for factoring things savings from things such as regulatory reform and welfare reform, things that haven't passed in Congress yet.

You said that more than 100 staff members from the Treasury Department were working round the clock on running scenarios for the analysis, and yet there was only this one-page report.

Is there going to be a more detailed analysis forthcoming?

MNUCHIN: Jake, there's a massive model that is behind it.

And what was important is to publish the reports. The Treasury has never produced a detailed model beforehand.

But let me just walk you through the numbers quickly, OK? During the Obama administration, for the first term, they predicted 3 percent growth. When they left, they predicted 2.2 percent growth.

I have been very consistent in saying the difference between 2.2 and 2.9 is $1.8 trillion. And we only need half of that or about a trillion dollars to get to break even. And that half of the growth will come from corporate tax reform alone.

TAPPER: I want to ask you about this new report in "The Washington Post" saying that policy analysts at the Center for Disease Control, as well as other divisions at the Department of Health and Human Services, were given a list of forbidden words as they prepare the 2018 budget, words that they're not allowed to use in the budget, including vulnerable, entitlement, diversity, transgender, fetus, evidence-based, and science-based.

Why would the Trump administration tell the CDC not to use a term like science-based in the budget?

MNUCHIN: It's the first time I'm hearing of that, so I'm not aware of that directive at all.

TAPPER: Has the administration ever told you not to use certain words?

MNUCHIN: Absolutely not. Nobody has told me not to use certain words. And I have never told anybody in Treasury not to use certain words.

TAPPER: Treasury Secretary Steve Mnuchin, merry Christmas. Happy Hanukkah. Hope you have a good holiday season.

MNUCHIN: Thank you. Great to be here.

TAPPER: A stunning victory. A Democrat wins a seat, a Senate seat, in arguably the most red state in the country.

That man, senator-elect Doug Jones, the newest Democrat in the Senate, he will join me live next.

Stay with me.

(COMMERCIAL BREAK)

[09:13:40]

TAPPER: Welcome back to STATE OF THE UNION. I'm Jake Tapper.

It was an historic and frankly shocking victory Tuesday night, Doug Jones defeating Roy Moore to become the first Democrat to win a U.S. Senate seat in Alabama in a quarter-century.

Jones' surprise win in a ruby-red state now has Democrats wondering if the House and Senate might be in play in 2018. President Trump is making the best of the loss, congratulating Jones and calling on Roy Moore, who has yet to concede the race, to do so.

Joining us now from Key West, where he is celebrating his 25th wedding anniversary, the newly elected senator from Alabama, Democrat Doug Jones.

Senator-elect Jones, congratulations on both the Senate victory and, of course, the 25th wedding anniversary.

JONES: Thanks, Jake. I appreciate it. Glad to have -- be with you here today. Thanks so much.

TAPPER: So, let me start by asking you about this letter sent to members of Congress from President Trump's lawyers accusing special counsel Robert Mueller of obtaining unauthorized access to tens of thousands of e-mails from the presidential transition.

You're a former federal prosecutor. Do you think that the investigation may be tainted?

JONES: Well, I don't know about that particular letter. I would be very surprised if Bob Mueller did anything that illegally

obtained or anything like that. He is the consummate professional. And that investigation is proceeding. It's going to go forward. I don't see any taint at this point.

[09:15:01]

The one thing that came up with regard to an FBI agent who had done some e-mails, was removed from the team, that's the process, that's how it works, and so I think it will just move forward.

TAPPER: I'm not sure if you heard Secretary Mnuchin earlier, but he seemed to suggest that he wants the investigation over. He hasn't heard President Trump talk about firing Mueller, but that it's up to the president.

Would you be concerned if the president fired Mueller?

JONES: Well, I think anybody would need to be concerned if Bob Mueller was fired.

I think this investigation is moving. It's going to shake down the way it's going to shake down. There's a lot of different avenues. You know, I have been in those grand juries. I have had -- dealt with those subpoenas before.

I think this is going to just run its course. I don't think he's going to rush it, but, at the same time, I think he's moving fairly expeditiously, because he understands the importance of trying to get this over and out in the open as soon as possible.

TAPPER: Roy Moore, your opponent, your vanquished opponent, still has not conceded.

Not only that. He's still fund-raising, even after both Steve Bannon and President Trump called on him to concede the race. Fund-raising e-mails sent by Moore this weekend say that the battle is not over. They claim voter fraud. They ask for money for an election integrity fund.

What's your message to Roy Moore this morning?

JONES: I say, it's time to move on. Alabama has spoken.

It was a close election. There's no question about that, but elections can be close sometimes. But now it's time to heal. Now it's time to move on and go to the next thing.

And we're ready. We're starting to put our team together to take over and try to get in there as soon as possible.

And I would just say, let's go. The election should be certified in a week or so, and I will be ready to go regardless of whether he concedes or not.

TAPPER: You told reporters on Wednesday that you had a -- quote -- "gracious phone" call with President Trump. The president, of course, has not always been so gracious when it comes to you.

In the days leading up to the election, he repeatedly attacked you, saying you were weak on crime, a Schumer-Pelosi puppet, bad for the military.

Is that all water under the bridge, as far as you're concerned?

JONES: Of course it is.

You know, when I got into this race, Jake, I understood that there was going to be a litany of things said about me. You can just -- it's a kind of a checklist, you know, when you get involved in politics.

And so none of that affected us. We moved forward. We were able to respond to show that I stood on my record on a number of those things, and we took our message straight to the people of the state of -- for the state of Alabama. And we're looking forward now.

And all those things, we can work together with anybody. That's been my whole mantra. Let's just try to find common ground to get things done for the people in the state, as well as the people in the country.

TAPPER: Republican Senator Cory Gardner, who is the chairman of the Senate Republican campaign arm, the NRSC, and purposely did not -- decidedly did not endorse Roy Moore, Cory Gardner was adamantly opposed to Roy Moore. In fact, he refused to help fund his campaign.

But take a look at the statement he released after your victory -- quote -- "I hope senator-elect Doug Jones will do the right thing and truly represent Alabama by choosing to vote with the Senate Republican majority."

Now, I know that you're going to vote according to what you think is right, but Alabama is a deeply red state. It went for President Trump by 28 points. Your reelection is just in three years.

In order to truly represent your state, do you need to consider voting with Republicans on some issues?

JONES: Of course I do.

I mean, look, Jake, one of the problems in American politics right now, in my opinion, is that everybody thinks, because you're a member of one party or another, you're going to vote a certain way.

And that should not be the case. It shouldn't ever be the case. I'm going to talk to people on both sides of the aisle, try to figure out what I think is in the best interests of my state and in the country.

Now, don't expect me to vote solidly for Republicans or Democrats. I came up with Senator Howell Heflin from Alabama many years ago. He did -- always to do the things that he thought was in the best interests of his constituents, which is in the state of Alabama.

And I don't think anybody should depend on, be able to count on my vote for anything. They have got to make sure that I'm looking at it, studying it. I'm going to study all sides.

TAPPER: Is there an issue or two that you could point to where you think you might vote with the Republicans?

Just looking at your position papers, you seem like a Democrat. I don't really see any areas where you might vote with the Republicans.

JONES: Well, sure.

Well, look, I think you're going to see an infrastructure bill coming up next year. That's going to be, I think, very important to the people of the state of Alabama. I'm going to try to look at that. I think there's any number of things that you can do.

You know, but, in these big issues, it's the big -- the problem we have got right now is, we're looking at these giant issues, these -- a 500-page tax bill that just landed on somebody's desk the other day that nobody really knows all that's in there. The health care bills were the same way.

I think there's any number of issues that come up on a daily basis or a weekly basis that we can find common ground on. But that's the main thing, is that a bill or an issue may start out one way, but trying to work with both sides, with both parties, I think, is going to be the way to go to try to get things done.

TAPPER: You had tremendous support from African-American voters on Tuesday.

[09:20:00]

According to CNN's exit polls, you won the African-American vote by 92 percent, African-American women even higher.

Native Alabaman and NBA legend Charles Barkley was all in on campaigning for you.

JONES: Right.

TAPPER: He told this to me after your victory. Take a listen.

(BEGIN VIDEO CLIP)

CHARLES BARKLEY, FORMER NBA PLAYER: This is a wakeup call for Democrats. They have taken the black vote and the poor vote for granted for a long time.

It's time for them to get off their ass and start making life better for black folks and people who are poor.

(END VIDEO CLIP)

TAPPER: Do you agree?

JONES: Yes, I'm having a little trouble hearing you there, Jake.

TAPPER: Oh, I'm sorry.

JONES: I thought you said, do you agree?

TAPPER: Do -- yes. Do you agree, sir?

JONES: Yes. I think -- I don't think you should take anybody's votes for granted.

I think it's time that we start looking around. Alabama is a very diverse state. We have got areas that we really need to focus on for jobs, and education, the economy, our work force development, working with Congresswoman Sewell, who was a great partner in this campaign.

I think there's a lot of things. I told folks early on in this campaign that everybody needs to do a political reset button and start looking at issues and start voting on those issues, rather than political parties.

TAPPER: Writer and civil rights activist Shaun King says that you, senator-elect Jones, you need to appoint at least two African- Americans to the four major positions you need to fill in your Senate office.

Can you commit to doing that?

JONES: I'm going to commit to having a Senate office both in my state and in D.C. that reflects the diversity of Alabama. We're going to be looking. We have got some great resumes coming in.

I have got folks from all over that want to do that. I want to make sure that I have the best staff available. It will absolutely reflect the diversity of the state of Alabama. I'm not going to get bogged down on numbers, but I can promise everyone that we're going to represent the entire state of Alabama.

TAPPER: In the wake of Al Franken's resignation, some of your Democratic colleagues have been calling for President Trump to resign because of the allegations against him, including Senator Cory Booker, Democrat of New Jersey, who recently campaigned for you in Alabama.

Take a listen to Senator Booker.

(BEGIN VIDEO CLIP)

SEN. CORY BOOKER (D), NEW JERSEY: Clearly, we have a standard in which Al Franken is resigning. The president has had multiple more women come, with a very clear fact pattern, and he should do the right thing and resign.

(END VIDEO CLIP)

TAPPER: Do you agree with Senator Booker that President Trump should resign because of these allegations?

JONES: You know, Jake, where I am on that right now is that those allegations were made before the election, and so people had an opportunity to judge before that election.

I think we need to move on and not get distracted by those issues. Let's get on with the real issues that are facing people of this country right now, and I don't think that the president ought to resign at this point. We will see how things go.

But, certainly, those allegations are not new, and he was elected with those allegations at front and center.

TAPPER: I guess the question is, why should Al Franken resign if there are even more horrific allegations about President Trump, and no one is calling for him to step down?

JONES: Well, again, I go back to the fact that those allegations were made, and he was elected president of the United States, and I think the American people spoke on that at this time.

There's other things out there, but I think, at this point, we need to move on and try to work with some real issues that are facing the country and not worry about getting at odds with the president any more than we have to.

TAPPER: Senator-elect Doug Jones, congratulations on your historic victory on Tuesday, and even a heartier congratulations on your 25th anniversary.

All right. Thank you so much. Appreciate it.

TAPPER: Lawyers representing President Trump's transition team is -- they are now accusing Robert Mueller of obtaining unauthorized e-mails from the president's closest advisers.

And now Mueller's team, they're fighting back. Is this all laying the groundwork for a firing of special counsel Mueller? Our panel will be here to discuss. Stay with us.

(COMMERCIAL BREAK)

[09:28:24]

(BEGIN VIDEO CLIP)

TRUMP: Well, it's a shame what's happened with the FBI, but we're going to rebuild the FBI.

It will be bigger and better than ever. Everybody, not me, but everybody, the level of anger at what they have been witnessing with respect to the FBI is certainly very sad.

(END VIDEO CLIP)

TAPPER: President Trump yet again expressing his displeasure with the FBI.

A big question: Was it foreshadowing? A new letter from the Trump transition team to congressional investigators alleged that the special counsel improperly -- improperly obtained unauthorized Trump transition e-mails, some of which contained privileged information.

In a rare move, the special counsel released a statement last night. It says -- quote -- "When we have obtained e-mails in the course of our ongoing criminal investigation, we have secured either the account owner's consent or appropriate criminal process."

The panel is here to discuss this and much more.

Jen Psaki, do you think that the president's lawyers are setting the stage for the firing of Bob Mueller?

JEN PSAKI, CNN POLITICAL COMMENTATOR: Of course they are.

But this has been a months-long, orchestrated, frankly, pathetic and also dangerous attack by FOX News, by many in the conservative right to try to discredit Mueller.

There is a big rumor in Washington, who knows, that there is going to be a Friday afternoon firing. I have no information on that, but all of this is to set up for that and create an echo chamber to support that ludicrous and dangerous action.

TAPPER: Do you think this -- writing in the letter that the investigation is tainted, there seems to be a purpose behind that. They're not just criticizing this action. They're criticizing the entire investigation.

MICHAEL CAPUTO, FORMER TRUMP CAMPAIGN ADVISER: Well, sure.

But, to begin with, these are different lawyers. These are transition lawyers. And they're talking about a commitment that the GSA made to them that they would -- that they would consult with them if they were asked for any of the documents that were left behind.

There is an argument that they're making that transition documents and e-mails are private property, even though they're held by GSA.

[09:30:09]

The fact of the matter is these were -- these e-mails and documents were released -- surprise, surprise -- by career bureaucrats at the GSA. More of this administrative state attack on President Trump.

They may be complaining about the GSA's politicization of this than Mr. Mueller. But at the same time, I mean, I believe there are more and more indications that the Mueller investigation is off the rails.

I mean, people have talked about well, you know, Strzok. He had this text --

TAPPER: The FBI agent. Yes.

CAPUTO: -- with his lover who was also married and on this investigation, that, you know, he fired him immediately upon finding out about this. That's not proof of him being a straight shooter on this. A straight shooter wouldn't have hidden the fact that it was the text that got him fired for months.

I mean, he was stonewalled in the Congress from the very beginning on this. We're seeing more and more that this is an attack on the presidency at levels we've never seen before.

TAPPER: What do you think?

KARINE JEAN-PIERRE, SENIOR ADVISER, MOVEON.ORG: I think it's just ridiculous. It really is a big joke what the transition lawyers are trying to do.

I mean, first of all there's no privilege because he wasn't a president at the time, he was a president-elect and anybody who's working in the transition team would know that and understand that. And this is a PR.

This has nothing to do with a legal argument, this is a pr argument. If they truly believed that there was an issue here with Mueller, they would go to the courts, they would go to the judge, they wouldn't go to Congress.

But, I mean, this is what they're doing is setting up the ground game to fire Mueller. And let me tell you, the majority of the American people will not allow this.

Moveon has had more than 80,000 people sign up for a protest if in case Mueller is indeed fired. Over 500 events across the country. People are not going to take this.

CAPUTO: Except the Harvard Harris poll released recently said 54 percent of Americans of all parties see the investigators as biased against Trump.

JEAN-PIERRE: OK.

CAPUTO: So you may see it on your end, but polling shows different.

JEAN-PIERRE: That's one poll. There are many polls out there.

CAPUTO: That's Harvard Harris not exactly --

(CROSSTALK)

ANA NAVARRO, CNN POLITICAL COMMENTATOR: First thing -- first thing -- first thing we got to say is that Bob Mueller is a patriot. This is a man who has put country first his entire life. This is a man who has sacrificed his entire life for this country.

Most FBI agents, most people working on this are also patriots who risk their lives every day and we have got to thank them. I don't like this because I knew that this was going to be -- you know, I firmly believe in this investigation and they need to get to the bottom of what happened with Russia.

This is an investigation that so far has netted two indictments and two guilty pleas, so it's not like there's nothing to show for it. There is something there. But I don't like this because I knew this investigation was going to be attacked from the get-go regardless of what the outcome was, and it gives them something, it gives folks something to attach themselves to and attack the credibility.

It is no coincidence that the congressional hearings on this and the leaks are all going on at the same time and, you know, the alt right and the right wing echo chamber is all doing it. I mean, they've got, you know, a hell of an orchestra going on with all the instruments playing at the same time.

TAPPER: Do you think that the president is going to fire Mueller or set in motion the process of firing Mueller?

NAVARRO: I certainly can't read Donald Trump tea leaves.

I know this. Republicans need to stop it. It is up to Republicans in Congress to assert some leadership in this and not allow this to happen which is going to lead into a national crisis, a constitutional crisis, and they are going to feel great pain in the polls come November.

TAPPER: Do you think the president is going to fire Mueller?

CAPUTO: I don't think he's going to fire Mueller. I think Mueller has to get his investigation in hand.

We have Weissmann who congratulated the deputy attorney general on insubordination against Trump. He then showed up at Hillary Clinton's victory party. We've got Strzok and his lover both who were entwined in this investigation, you know, 10,000 texts between them.

And it goes on and on and on. This is no different. The Republican criticism of this investigation is no different than what we were seeing of the Ken Starr investigation.

This is not a highly partisan event. This is a typical event.

NAVARRO: No that's --

(CROSSTALK)

NAVARRO: What you just said isn't actually true, it's the same criticism about political witch hunt that we heard during Benghazi, it's the same criticism that we heard during Ken Starr. It is a politicized --

CAPUTO: It's politics as usual.

(CROSSTALK)

JEN PSAKI, CNN POLITICAL COMMENTATOR: But what this is about is whether the sitting president of the United States worked for the foreign adversary to rig the election and then covered it up.

CAPUTO: Zero proof. Zero indictments, zero guilty pleas --

PSAKI: Zero indictment --

(CROSSTALK)

CAPUTO: -- zero on Russia. There is nothing on Russia. Everything is a process.

(CROSSTALK)

PSAKI: Let me just -- let me just finish and make one more point.

I worked on a presidential transition. Your e-mails are government property.

NAVARRO: Yes.

PSAKI: This is totally fake, made-up, conspiracy-driven thing.

CAPUTO: But this is --

PSAKI: This is not real.

Also a content of these e-mails are about gossip about Senate nominees. I don't think Mueller cares about that. Mueller does not care about that.

Let's get back to the focus of whether the sitting president of the United States worked with Russia to rig the election and then covered it up.

[09:35:05]

That's the big question. Who cares about all this other stuff?

(CROSSTALK)

NAVARRO: There was a whole lot of leaking going on on every side of this investigation, whether it be DOJ, whether it be Congress, whether -- you know, it's just -- somebody has got to get this thing under control.

I give Mueller a lot of credit for recognizing that there was a problem and getting rid of this Strzok guy immediately.

TAPPER: Why --

JEAN-PIERRE: But here's the thing -- here's the thing --

NAVARRO: And the DOJ leaked it out. There was nothing to hide. What are you going to go -- I mean, he did what he had to do at the moment he found out about it.

He needs to continue doing more of that. He needs to know that -- and I'm sure he does -- that it needs to pass political muster, that it needs to pass the sell test --

CAPUTO: I think you're right. NAVARRO: -- and he has got to have complete authority.

JEAN-PIERRE: But you can't -- but you can't forget that Mueller was -- when he became FBI director, he was appointed by a Republican. He was appointed to special counsel by a Republican. He is a Republican.

I mean, it's not -- this is not a partisan thing where Democrats are trying to take down the president. This is Mueller who has one of the best legal minds out there, and honestly, if you're looking at the White House in White House versus Mueller, who are you going to believe? The White House can't even put together a sentence without lying.

TAPPER: Everyone stick around. We have got a lot more to talk about. A Democrat congressional candidate says she was forced to drop out of the race over a false sexual harassment allegation against her. And now she's lashing out at the Democratic Party's zero tolerance policy.

We'll have more with our panel next. Stay with us.

(COMMERCIAL BREAK)

[09:40:37]

(BEGIN VIDEO CLIP)

SEN. KIRSTEN GILLIBRAND (D), NEW YORK: It was certainly just a sexist smear intended to silence me. And I'm not going to be silenced on this issue. I've heard the testimony of many women on numerous accusers. I believe them and he should resign for that.

(END VIDEO CLIP)

TAPPER: That was Democratic Senator Kirsten Gillibrand of New York responding to this tweet from President Trump -- quote -- "Lightweight Senator Kirsten Gillibrand, a total flunky for Chuck Schumer and someone who would come to my office begging for campaign contributions not so long ago (and would do anything for them), is now in the ring fighting against Trump. Very disloyal to Bill and Crooked-USED."

So you have said, Mike (ph), nice things about Kirsten Gillibrand in the past what do you think about her during this episode? Do you agree President Trump was making a sexist insinuation by saying she would do anything for campaign contributions?

CAPUTO: No. And in full disclosure. I've worked against her in both of the (INAUDIBLE) for (ph) last two elections. I mean, she's my senator.

I've seen her change a lot and she's come into her own. She used to be under Chuck Schumer's shadow like the president said, but now she's out there.

By the way, out there on sexual harassment issues for six or seven years.

TAPPER: Yes.

CAPUTO: So she's very well positioned here.

If I were a Democratic -- a cynical Democratic operative, I would recommend that she do exactly what she's doing, take on the president. I'm just a cynical Republican operative who can tell you that I don't believe that the president was, you know, putting out a sexist smear.

What the president does, if we see this and we all watch Twitter all the time now that the president is relying on Twitter as a communication device, is that he walks this line of propriety. He says something where he has plausible deniability and nobody in the media or on the left believes that deniability.

The people on the right believe the deniability. Some who has mastered strokes (ph) of Twitter but what she has done here is pick a fight with the president, the president has responded, and she has the chance here as a potential presidential candidate of vaulting over the heads of virtually every other candidate to be in the lead in 2020.

TAPPER: Do you agree with Mike that this has helped Kirsten Gillibrand?

PSAKI: I do. The one piece I disagree with is that President Trump -- if this was a one-off, that would be one thing. But this is a guy who has misogyny in his DNA who ran as a misogynist. I'm sure that wasn't on a bumper sticker but this was part of what he ran as.

So this is completely aligned with that. That's why people heard what they heard from the tweet.

I do think -- I've known Kirsten Gillibrand since she was running for Congress. She was an underdog. She ran against a guy who was accused of abusing his wife.

She has (INAUDIBLE), she has her back against the wall, she's tough, she's smart. She's not losing sleep over Trump tweets, she's taking advantage of it --

CAPUTO: (INAUDIBLE).

PSAKI: -- in a very smart way. And you're absolutely right that she is rising above others right now, because she set this up in a kind of several weeks of being the first and first and foremost on --

CAPUTO: Don't forget the word "lightweight" because that will be the nickname now. Lightweight Kirsten Gillibrand.

TAPPER: She was magna cum laude at Dartmouth just for the record.

So anyway, I do want to ask you the White House said that you would have to have your mind in the gutter to think that that was a sexual smear, that it had anything to do with sexist, that she would do anything for campaign contributions.

NAVARRO: Well, then an enormous amount of America has their mind in the gutter according to their definition.

Look, here are two things that are true. Kirsten Gillibrand, this was early Christmas gift for her. She will continue fundraising and it is good for her.

Also, Kirsten Gillibrand has got incredible consistency and track record fighting sexual harassment and fighting sexual abuse and standing for victims. Let's remember that just a couple weeks ago she was saying that Bill Clinton should have taken harder consequences.

She stood up against her colleague, friend and partisan Al Franken. So this is a woman for whom this is not a partisan issue or a political issue, it is a real issue. It is a conviction and a principle.

CAPUTO: If it is --

NAVARRO: And it's also true that Donald Trump has a long record of misogyny, of sexual harassment. He's got over 12 women on the record who accuse him of such.

We heard him on tape boasting of such in his own voice. So both of them have a long track record which is why he should not continue digging this hole.

TAPPER: I want to ask you if the pendulum has swung too far.

That's at least the theory of Andrea Ramsey. She was a Democratic candidate for the third congressional district in Kansas. She dropped out of the race after news emerged that there was a 2005 lawsuit in which a man accused her of sexual harassment.

[09:45:01]

She says it's completely made up and she -- but she dropped out of the race and she wrote in a letter to residents of the Kansas' Third -- quote -- "In its rush to claim the high ground in a roiling national conversation about harassment, the Democratic Party has implemented a zero tolerance standard. For me that means a vindictive, terminated employee's false allegations are enough for the Democratic Congressional Campaign Committee, the (DCCC), to decide not to support our promising campaign."

Does she have a point? Has the pendulum gone too far?

JEAN-PIERRE: No. Look. I think we're at a point in time in this country where the Me Too movement has really take -- has really gotten some traction and we're finally listening to victims, whether they're women or men.

And I think if you're running for office, you can't have been accused of sexual harassment or assault. And I think that we have to really take that next step here and make sure it doesn't happen to anyone in office or out of office.

And I do want to say one thing with this discussion about Gillibrand and Donald Trump, look, they're both consistent. Gillibrand has been a fighter for women and she has been very consistent in the last -- almost a decade. And then you have Donald Trump who has been very misogynistic.

And I just want to -- he has. He ran on that and he is who he is.

CAPUTO: That's not --

(CROSSTALK)

JEAN-PIERRE: -- I want to say -- I want to just give one quote that Michelle Obama said during the election last year which is, the presidency doesn't change you, it reveals who you are. And this is what we're learning about Donald Trump every month, every day for the past 11 months.

TAPPER: I do to want talk about Andrea Ramsey, though, because I do wonder what Karine just said is it like if you can't run if there have been accusations. But an accusation, even in the vast majority of time, these accusations are true.

PSAKI: Yes.

TAPPER: But the vast majority is not 100 percent. There are false accusations out there. It does happen.

Even the most liberal, most progressive advocates for women against sexual violence can see that point. Is an accusation enough?

PSAKI: Yes, it is enough.

I completely agree that in the time we're in right now this is going to be perhaps a bloody period, but, I mean, the fact is that Democrats and the Democratic Party cannot be, here, you have a waiver. We have zero tolerance but.

And that's an important line for the Democratic Party, and really, honestly, for anybody who is elected by the American public to hold firm on. There is a lot of pressure on the media who are often the ones who are going through these stories and determining what's true and what's inaccurate.

For Andrea who is running in a primary in Kansas it may be that the media works this through and this is inaccurate. And I certainly hope she runs again. But at the same time if somebody is accused of sexual harassment I believe that they shouldn't -- they're not in a position to run for office.

NAVARRO: We just saw this play out in the Roy Moore case in Alabama. We had there women who had very credible accusations and they were scrutinized and they reported by the "Washington Post." And we had a woman who tried to make up a story and feed it to the "Washington Post" and they scrutinized and it didn't pass muster and they didn't fall for it.

TAPPER: Yes. NAVARRO: So all accusations are not created equal, but what we have seen is that the Democrats realized they need to have the high ground if they were going to point a finger. And on the one hand you've got Conyers who retired, Franken who just resigned, this woman who just withdrew.

And on the Republican side shamefully you've Farenthold still there. You've got a president of the United States who has been accused by 12. It is a double standard and the Democrats took out the high ground.

TAPPER: Very quickly.

CAPUTO: I stand with Doug Jones on this. Donald Trump stood before the voters and was found not guilty of these scurrilous accusations.

I'm also very depressed --

(CROSSTALK)

PSAKI: He wasn't found --

CAPUTO: -- by the American people.

JEAN-PIERRE: He's not guilty. And no women have come out and (INAUDIBLE).

TAPPER: Thanks one and all. I appreciate your being here.

"Make America Great Again" (INAUDIBLE) slogan that the president used during the campaign. But a slogan in the White House seems to be "You're Fired." And that's the subject of this week's "State of the Cartoonion."

Stay with us.

(COMMERCIAL BREAK)

[09:53:05]

TAPPER: Welcome back. "You're fired," it's the phrase that made businessman Donald Trump a national sensation. And one he has not stopped using in the White House and that's the subject of this week's "State of the Cartoonion."

(BEGIN VIDEOTAPE)

TAPPER (voice-over): Well, Omarosa just got fired.

TRUMP: You're fired.

OMAROSA MANIGAULT-NEWMAN, OUTGOING ASSISTANT TO THE PRESIDENT: I resigned.

TAPPER: I suppose in retrospect we should have all known that the man know for a specific signature phrase --

TRUMP: You're fired.

TAPPER: -- would go through White House and administration personnel as speedily as Congress goes through sexual harassment settlement funds. Not just the firing of James Comey, of course, which is its own special constitutional case --

TRUMP: You're fired.

TAPPER: -- but the long, long list. National security adviser Mike Flynn.

TRUMP: You're fired.

TAPPER: And press secretary Sean Spicer.

TRUMP: Fired!

TAPPER: And chief of staff Reince Priebus.

TRUMP: You're fired.

And HHS secretary Tom Price.

TRUMP: You're fired.

TAPPER: And communications director Anthony Scaramucci.

TRUMP: You're fired.

TAPPER: And senior strategist Steve Bannon.

TRUMP: You're fired.

TAPPER: And whatever it was exactly that Sebastian Gorka did.

TRUMP: You're fired.

TAPPER: The list goes on and on and on.

TRUMP: You're fired.

TAPPER: Hey, I'm not even listing anyone anymore, Mr. President.

TRUMP: You're fired.

TAPPER: OK. This is just weird.

TRUMP: You're fired! Get out of here. TAPPER: Of course, the president might want to think twice before going after special counsel Robert Mueller. Firing him might create even more of a constitutional crisis than the firing of Comey potentially ultimately caused.

TRUMP: You're --

TAPPER: Yes, you might want to think twice about that one, sir.

(END VIDEOTAPE)

TAPPER: They're changing the world by doing extraordinary things, everyday heroes, giving everything they have to help others, the 10 men and women who put others first all year long.

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