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Kelly Condemns Abuse In Memo To Staff; WAPO: White House Lawyer Knew Of Damaging Info For A Year; Source: Trump Upset Over Handling Of Abuse Claims; Trump Signs Bill To End Government Shutdown; Rand Paul Slams "Hypocrisy" Of GOP On Deficit Hike. Aired 11-11:30a ET

Aired February 9, 2018 - 11:00   ET

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


[11:00:26]

BRIANNA KEILAR, CNN ANCHOR: Hi there. I'm Brianna Keilar in for Kate Bolduan. The White House on the defensive. The president's chief of staff on the hot seat as we learn more about the domestic abuse allegations against a top presidential aide, Rob Porter who has now resigned.

A source tells us that the president is dismayed by the deepening scandal, that John Kelly knew about the allegations for months but kept Porter in his job, that is until this week when Porter's ex-wives went public. The White House offering a timid acknowledgement.

(BEGIN VIDEO CLIP)

RAJ SHAH, WHITE HOUSE PRINCIPAL DEPUTY PRESS SECRETARY: I think it is fair to say that, you know, we all could have done better over the last few hours or last few days.

(END VIDEO CLIP)

KEILAR: Now, word of another top White House insider knowing and doing nothing. A source tells CNN that Porter's ex-wife called White House Counsel Don McGahn in recent weeks to talk to him about her allegations of abuse, and there is another new report that McGahn knew about the accusations a year ago. We'll have much more on that in just a moment.

First, I want to go to CNN's Kaitlan Collins. She's live for us at the White House. So, Kaitlan, we have some new information about President Trump's reaction to this crisis. Tell us what you're learning.

KAITLAN COLLINS, CNN WHITE HOUSE REPORTER: Yes. That's right, Brianna. Another stunning development as we continue to see the White House be engulfed by this scandal and the resignation of Rob Porter. That is the relationship between the president and one of his top aides, and closest confidantes, Hope Hicks.

Sources are now telling CNN that the president has grown increasingly frustrated with the way Hope Hicks has handled the situation for a myriad of reasons. One being that he was not consulted when Hicks and several other top aides here in the White House drafted that first statement initially that defended Rob Porter.

Secondly, the president feels that Hope Hicks has allowed her romantic relationship with Porter to really cloud her judgment and her decision-making here from a White House standpoint and overall, Brianna, the president feels, bottom line, end of the day, that Hope Hicks put her own priorities above his and above the White House's here.

Now Hope Hicks is certainly not the only staffer that is dealing with the aftermath of all of this. John Kelly, the chief of staff, and what he knew has become a top focus as well, and he clearly is hearing that because last night he issued a statement, late last night, to White House staff about domestic abuse trying to quell some of the fears and some of the backlash that has been over how they handled this situation.

And in this letter, he said, while we are all processing the shocking and troubling allegations made against a former White House staffer, I want you to know that we all take matters of domestic violence seriously. Domestic violence is abhorrent and has no place in our society.

Now, Brianna, I should point out that we do not know that Hope Hicks and John Kelly's places in this White House are in jeopardy, in any sense of the way, but we're continuing to see a lot of distance between the president and his top aides over the way they are handling this because, though, Rob Porter's last day at the White House was Wednesday, he was here yesterday to essentially clean out his desk, but Hope Hicks was continuing to defend him to her White House colleagues -- Brianna.

KEILAR: So, privately that's what she was doing, she was defending him.

COLLINS: Yes, that's right. Hope Hicks continued to privately defend Rob Porter yesterday, here at the White House, though he was only here for a brief period of time to clean out his desk.

During that same time period, the president was growing very frustrated with the way his top staffers, those that he has in charge of this and those that he trusts, the way that they were handling this here -- Brianna.

KEILAR: Very interesting reporting from Kaitlan Collins there at the White House, thank you. I want to turn to the new questions surrounding White House Counsel Don McGahn. "The Washington Post" is reporting that McGahn knew about the allegations a year ago.

I want to bring in one of the reporters who broke this story, Beth Reinhard, with me now on this. Beth, thank you so much for talking to us, really interesting reporting that you have here, especially as the spotlight is now on Dn McGahn, the White House counsel and his role in keeping Porter in the White House.

Your team actually managed to get him on the phone. So, I want to go over the larger timeline in a moment, but, first, tell us about this, what did McGahn say about when he first learned of the allegations against Porter and what did Porter himself tell McGahn about them at that point, according to what the White House counsel is saying?

BETH REINHARD, REPORTER, "WASHINGTON POST": So, sources are telling "The Washington Post" that Rob Porter talked to McGahn over a year ago and in January and said I want you to be aware that my ex-wives are prepared to make damaging accusations about me. And this is, of course, in the context of his security clearance.

[11:05:05] So that was the first time this was put on the radar screen and it was flagged to him several times, subsequently, and all the while Rob Porter is working in -- as staff secretary, very high-level position, with a lot of access to the president himself and to classified documents.

KEILAR: So, that first time that you report that this came to McGahn's knowledge was in January of 2017, right? Is that right?

REINHARD: Yes.

KEILAR: OK. So, then there is these other points of time where you mentioned, like, this comes up again and again, these allegations kind of keep intersecting with White House aides. You have -- we're looking at your reporting here, June 2017, was told when the office of personnel security flagged FBI findings.

So, Don McGahn was told, right, that there had been some FBI findings and then he learned in September that the claims were delaying the security check and then tell us about this most recent event where Porter's ex-girlfriend, so not one of his two ex-wives, but a third woman actually contacted McGahn.

REINHARD: So, just to clarify a couple of things, in June, when the FBI flagged this, with a White House office, it is not clear that McGahn himself learned of that. However, I will add that, you know, the ex-wives were interviewed by the FBI in January. So that's 13 months ago.

The FBI is getting pictures of Colbie Holderness with a black eye, the protective order that Jennie Willoughby filed against her husband. All of that is accessible to Don McGahn if he wants to learn more about these damaging accusations about his staffers told him are lingering out there.

In June, another opportunity, in September, he's made aware that this is delaying his security clearance as is Chief of Staff John Kelly. And then as you point out, in November, another time, former girlfriend of Rob Porter's contacts Don McGahn and says you need to be investigating these allegations, which obviously he's already aware of.

KEILAR: So, in your reporting, Beth, that you and josh did, did you get the sense that McGahn and Kelly were so determined to keep him in this key role, he had such a good rapport with the president that they turned a blind eye here. REINHARD: Yes, he was a capable person in the White House. He was viewed as a very valuable and trusted person who was part of their mission to try and instill discipline in the White House, control the flow of information to Trump's desk and by everyone's account was doing that very effectively.

And was, you know, widely admired in the west wing. And so, yes, I think there were many opportunities for both of those officials to learn more, probe more, ask more questions, and if they thought so, take action, and they decided not to because they -- they valued him as a member of their team.

KEILAR: Beth Reinhard, great reporting today and thanks for being on to share it with us.

REINHARD: Thank you.

KEILAR: I want to bring in our panel to talk more about this, Ana Navarro is a CNN political commentator and Republican strategist, Alice Stewart, CNN political commentator and former communications director for Ted Cruz's presidential campaign, and Bill Press is the host of the syndicated "Bill Press Show."

OK. So, Alice, you heard from Beth there, she was one of two reporters on this story out of "The Washington Post" that gave us a lot of new details. Every day seems to be bringing more questions about how the chief of staff, John Kelly, handled this. White House Deputy Press Secretary Raj Shah tried out a certain interesting phrase yesterday.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: You used the term fully aware. I don't understand what that means. What does that mean, John Kelly knew or didn't know?

SHAH: I do know for instance that he had not seen images prior to his statement -- the statement on Tuesday night.

UNIDENTIFIED FEMALE: Did he know of the allegations?

SHAH: Sorry, say it again?

UNIDENTIFIED FEMALE: Did he know of some of the allegations?

SHAH: I'm not going into get into the specifics of what may have emerged from the investigation.

UNIDENTIFIED FEMALE: You used the words fully aware so I'm just trying to --

SHAH: (Inaudible) I'm saying specifically on images. I don't have every single detail and I'm not get into every single specific. We relied on a process.

(END VIDEO CLIP) KEILAR: It seems, Alice, that maybe if you were to get into the specifics here it would not -- which is what Beth did, and we just heard from that, it would not cast John Kelly in a good light, certainly not Don McGahn in a good light on how this was handled.

ALICE STEWART, CNN POLITICAL COMMENTATOR: Certainly not, Brianna. I wouldn't cast anyone really in this administration in a good light. We have spent the first almost 10 minutes of this program outlining a pretty detailed timeline of when the information did get to people at the White House, whether it is the legal counsel or the chief of staff.

[11:10:04] And nothing was done until it was printed in the paper for all the world to see, and this is disturbing. Character counts and when you have an administration that puts someone with such egregious private behavior in public service office, that's really disturbing.

And this isn't the first time we had numerous incidents where there is either domestic violence or sexual harassment and this administration looked the other way. They downplayed the accusations and they defended them and discredited the women.

That is not the kind of example that we need to set for this country and for women of -- women across the world. We're better than that and for this administration to really discourage women who are in a difficult situation, it is really, really frustrating.

And, look, if they want to tout the bravery of General Kelly fighting at war, they also need to recognize the bravery of these women fighting against domestic violence, and we need to take a stand and at some point, there is going to be a bridge too far and this is it.

KEILAR: Bill, I wonder what you think about some of what we're hearing from the White House. It seems Kelly was aware that some of the allegations were holding up the permanent security clearance of Porter. So, he knew that.

That he's in the fully aware. I mean, how does it stand to reason that Kelly didn't inquire about these allegations. It seems to me that if someone says, hey, there is something holding up a security clearance, it is reflexive to say what is that? And if you find out that it has to do with domestic abuse, you say, tell me more.

BILL PRESS, HOST, "THE BILL PRESS SHOW": Yes, I never thought I would hear myself say this right, but I think you got to say that Donald Trump was not well served in this case by any of his staff around the White House.

He was kept out of the loop, and they didn't do what they should have done. The other thing I have to say is that the reason this is really bad, I mean, this is all a self-inflicted wound at the White House.

This is not something that Donald Trump can blame on Chuck Schumer or Robert Mueller or fake news. I mean, this has created right inside the White House and that's where it has got to be dealt with. I think you're right, the two people that come across, three looking really bad here, John Kelly, first of all, I mean, he knew when, haven't really been told, last August or November or whenever he knew there was a problem that they extended Rob Porter's lack of a security clearance for 13 months, which is unprecedented.

Knowing the reason why is because there were accusations against him of domestic violence, and John Kelly looked the other way, he defended him as late as Wednesday night, or Wednesday morning, rather, Tuesday night and Wednesday morning.

And this is, of course, not the first time, John Kelly has stepped in it and got in trouble. What I found most disturbing in Mary Beth's reporting, I'm sorry in the "New York Times" this morning, is that back in 2016, there was a case of sexual assault against a Marine colonel and then General John Kelly testified in that trial as a character witness on behalf of the Marine accused of sexual assault against two women and defended him as a superior military officer.

So, I think there is a problem here with John Kelly and with John McGahn. They knew for over a year about these allegations of why he was being held up and Hope Hicks writing the statement defending her boyfriend, Rob Porter.

Listen, I think there has to be some resignations here starting with John Kelly and Don McGahn and Hope Hicks.

KEILAR: So, Bill, I want to get Ann in here. Bill is saying there this has to be -- it is a good point, this has to be solved within the White House. So how do they deal with this, especially with this reporting we have that the president is really not feeling as if he was well served, to Bill's point?

ANA NAVARRO, CNN POLITICAL COMMENTATOR: Look, this is hard for me because I know John Kelly. I knew him here in Miami where he was South Com commander and he did a great job. I am in -- I'm in awe and I have great respect for his service to this country, for the sacrifice that his family, that he and Caryn Kelley have suffered in the loss of their son.

That being said, John failed here. He failed professionally and he failed personally. He failed Donald Trump. He failed the man he works with. He failed the country. He failed American women. He failed all Americans.

And I think John needs to take stock of that, needs to acknowledge that and do more. Last night, I was watching one of the ex-wives speaking to Anderson Cooper and telling her story, I found it so painful that people in the White House, John Kelly, Don McGahn, chose to believe the assaulter.

Not the women who were the victims, not the women who were the victims of his violence and his anger. I think John Kelly should pick up the phone and apologize to those women for not having believed them, for not having done more, for the process failing them. I think Don McGahn should do the same thing. Look, I think this is a learning moment for the White House and they could take it as an opportunity to really cast a light on domestic violence. The same way we have seen done with sexual harassment after Harvey Weinstein.

This could be a water shed moment for women, for victims of spousal abuse, it's not just women, and the White House could lead on this. So, I think there is a lot more that people like John Kelly and Don McGahn could do right now.

Starting with talking to the American people, acknowledging they failed, they made a mistake, acknowledging that there is no room in this White House, in this government, in this country, for spousal abuse and that those who commit it will pay a cost, a very high cost.

KEILAR: Alice, I wonder what you think, and especially your comments stuck with me because you, you know, you are a fan of some of the things that this president does. But you said you're putting your foot down on this one. What do you want to see done in response by this White House?

STEWART: Sure. I support the president and his policies. I support the principles with regard to conservative values that he has stood up for with regard to Supreme Court justices and other more conservative issues.

But this is something that you cannot -- no one, this is a nonpartisan issue, this is not Republican or Democrat, black or white. This is just completely wrong. Domestic violence is an issue that we all should agree that no one should tolerate this, and --

KEILAR: Can Kelly fix this, Alice, without leaving?

STEWART: That's the president's decision to make. He clearly has some cleanup to do and not just to the president for not notifying him of this, but as Ana said to the women and to the American people, to send a message that this cannot be tolerated.

And clearly there is a lot of communication that needs to go on behind the scenes with regard to -- not just with Rob Porter, but the -- you also have to consider the security issues here. He's been operating with the security -- interim security clearance for classified information, that is a grave concern.

But that is one aspect of this. But most importantly, just the simple fact that character should count. For people in such a high level prestigious office, if we don't as a country stand up to this kind of behavior, it diminishes all of us. It's up to this administration to take a stand.

KEILAR: I have to leave it there, you guys, I'm so sorry we're out of time. Alice Stewart, Ana Navarro and Bill Press, thank you so much for your thoughtfulness. I really appreciate it on this discussion.

We do have to check in with Wall Street. Traders there may be welcoming the weekend even more than usual. The Dow closing down more than a thousand points yesterday. It's on track for its biggest weekly loss since the financial crisis in 2008.

Let's check in on the markets with CNN's Alison Kosik, who is there at the New York Stock Exchange on the floor. What's happening, Alison?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Hi, Brianna. So, the volatility continues, nothing really groundbreaking, but just to illustrate for you just how volatile it is. So, the market has been open about two hours. It already made a swing of 576 points. It's been up as much as 349 points and is down as much as 227 points.

And that's just in the span of less than two hours and the day is still long. We have got many hours to go for the 4:00 p.m. Eastern closing bell. And what we're really going to be watching, Brianna, is the end of the day, from 3:00 to 4:00.

Because what we saw yesterday was that tsunami of selling happening literally during that hour where we saw the Dow tumble hundreds of points to close 1,035 points lower. So, the Dow and the S&P 500 entered correction territory yesterday. The S&P 500 still in correction mode. That is a 10 percent drop from a recent high -- Brianna.

KEILAR: Alison Kosik, thank you so much.

Coming up, President Trump this morning clearing the final hurdle to end a short-lived government shutdown that happened while you were sleeping. But at what cost to the nation's debt and the key Republican principle? This Congress finally ready to tackle immigration. We'll be live for you on Capitol Hill.

Plus, a stunning visual marking today's opening ceremony for the Winter Olympics and it was not fireworks. The sister of North Korea's Kim Jong-un sitting just feet from the vice president of the United States amid a tense showdown over North Korea's nuclear program. Stay with us.

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[11:23:41]

KEILAR: The latest government shutdown ending just hours ago hopefully while you were sleeping, and President Trump this morning signing the budget bill to end that brief shutdown. The president marking the occasion in a new tweet saying the bill would make the military stronger and add jobs.

This is a two-year, $400 billion bipartisan deal that gives a big boost to military, but also domestic spending. It adds, though, hundreds of billions of dollars to the deficit and it still leaves the pressing issue of immigration in question.

CNN's Ryan Nobles is on Capitol Hill with all of the details for us. So, Ryan, we will get to the drama surrounding the passage of the bill. But first, just tell us what's in it.

RYAN NOBLES, CNN CORRESPONDENT: Well, basically, Brianna, this is a major budget deal that was hashed by both Republican and Democratic leaders in the House and Senate, and what it does for the most part is stave off this budgeting by crisis that this body has been a part of for the last several years, at least for the next two years.

Let's take a look at the numbers involved in this final bill. It is going to increase defense spending by quite a bit, $165 billion in extra defense spending. Another $131 billion in nondefense spending, that includes a number of domestic programs including a ten-year extension for the Children's Health Insurance Program.

There will be another $90 billion in disaster relief, that will go to places like Texas and Puerto Rico and Florida after these recent spat of hurricanes, and the debt ceiling is going to be hiked until March of 2019.

[11:25:06] Which was something that budget negotiators here were a little concerned about that they would come up with a spending plan, but then still have to deal with the debt ceiling so that's been taken off the table.

But as you point out, Brianna, even though they hashed out issues regarding the budget, they still have another big standoff in front of them and that is what to do about immigration.

In exchange for this budget deal, essentially, Senate Majority Leader Mitch McConnell has promised Senate Democrats that they're going to bring some sort of a bill to the floor that will address DACA.

There is no assurances that that bill will pass and no assurances that it will make it through the House and then eventually be signed by President Trump. So, there is still a lot of negotiating to do here up on Capitol Hill.

And it is not clear whether or not those big breakthroughs when it comes to immigration are in the near offing, although at this point, at least on the Senate side, the leaders here seem optimistic -- Brianna.

KEILAR: And Rand Paul, a senator from Kentucky, had some choice words for the Senate. Tell us about that.

NOBLES: He sure did, Brianna. Even though this bill does have bipartisan support, we should point out that there are a lot of people both Republicans and Democrats that are very upset with it, particularly the conservative fiscal hawks who believe that just balloons the deficit way too much.

Rand Paul basically said that he's disappointed and embarrassed by this bill. He doesn't think that it addresses some of the big concerns that he has. He's one of the reasons that the government was shut down last night because he put his thumb on a bill that would push forward the voting process. So, yes, Brianna, they got this passed but it wasn't without a fight.

KEILAR: All right. Ryan Nobles on the Hill for us. Thank you so much. Joining me now is CNN politics reporter and editor-at-large, Chris Cilizza. OK. So, Chris, when this deal was announced, you called time of death on the Republican Party as it was before Donald Trump. Explain that.

CHRIS CILIZZA, CNN POLITICS REPORTER AND EDITOR-AT-LARGE: Yes. Rand Paul speaking last night, Brianna, was seen as a pain in the butt for a lot of Republicans because they wanted as Ryan mentioned, they wanted to move this through the Senate. So, they could avoid a government shutdown, however brief.

But what Rand Paul was saying was exactly what every leader in the Republican Party would have agreed with five years go. This is a party that was organized 100 percent during the Obama years to deficit reduction, and restraining spending.

That's why we have the Paul Ryan budget, which in many ways is why we have Paul Ryan as the speaker of the House. They have gone away from that because Donald Trump committed a hostile takeover of the Republican Party and he doesn't care about debt and deficit.

This is a person who very famously said, called himself the king of debt and proclaimed, I love debt. They have gone along with that. What Rand Paul was doing on the floor last night was saying, wait a minute, we're the same party that five years ago was railing against Barack Obama for this bloated government spending.

We're adding $400 billion to the debt last night, and we just added a trillion dollars to the debt with the tax cut which, by the way, Rand Paul did vote for.

KEILAR: It is a really good point and pain in the butt I should say, that's a technical political term that you're employing.

CILIZZA: I went to political school for that.

KEILAR: I'm sure you did not. OK. Tell us about what Democrats got out of this we saw that spectacle by the Democratic Leader Nancy Pelosi. She didn't get a promise from Paul Ryan to introduce debate and have a vote on immigration reform and protection for DREAMers.

CILIZZA: Right. So, look, they got a lot of domestic spending that they wanted, disaster relief that they had been pushing for, so they got some of those things. If you believe there are lots one leverage point here was spending and government shutdown to ensure a DACA compromise, they didn't get that.

They got the promise of a conversation. So, in the Senate we know Mitch McConnell moved on he's going to move on to an immigration debate, lots of amendments, a fight, but no deal in place there.

And frankly, the dynamics are the exact same that we saw the last government shutdown, which is Donald Trump is demanding significant funds for a border wall, Democrats don't want to give it to him. So, we are sort of where we were before all of this happened.

KEILAR: I'm used to being where we were before all of this. It seems that's always where we are. Chris Cilizza, thank you so much, Chris. Coming up, the Winter Olympics are kicking off today in spectacular fashion and the most captivating moment had nothing to do with the athletes. Kim Jong-un's sister sitting just feet from Vice President Mike Pence during the opening ceremony. That's next.

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