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President Trump Claims No Chaos in the White House; Porn Star Sues Trump Says, "Hush" Agreement Is Invalid; Stocks Set To Open Lower After Gary Cohn Resigns. Aired 9-9:30a ET

Aired March 7, 2018 - 09:00   ET



[09:00:18] JOHN BERMAN, CNN ANCHOR: Welcome to the least chaotic morning in history. Good morning, everyone. John Berman here.

Sure, the White House chief economic adviser just quit and the markets look like they might tank because of it, and a porn star just sued the president, and the Russia investigation has a new cooperating witness who was intercepted at an airport. And the president's personal lawyer is now reportedly the focus of questions by the Russia special counsel, and that same lawyer is also connected to the porn star lawsuit.

Beside that stuff, it is wicked un-chaotic this morning. The most immediate issue is the departure of Gary Cohn. The economic adviser just had enough. And with just 30 minutes before the Opening Bell, you can see that makes Wall Street very nervous. Down about 1 percent in pre-market trading.

But not to worry, the president says many people want the job and he will, quote, "choose wisely" among the candidates who may, in fact, number, give or take, two.

Let's begin this morning at the sea of tranquility. CNN's Abby Phillip live at the White House with the very latest in this revolving door -- Abby.

ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: Well, good morning, John. Absolutely nothing to see here at the White House even though the ripple effects of Gary Cohn's departure is still being felt here. Wall Street as you just mentioned is projecting that they might go sharply down today on fears that there is a new rise in economic populism and nationalism here in this White House.

Gary Cohn clashed with President Trump over this issue of tariffs on steel and aluminum that Trump announced last week. Cohn opposed those tariffs, believing that they were bad economic policy. That they could put the economic growth of the country as currently experiencing in jeopardy.

Ultimately that dispute led to his resignation last night. And he just becomes one of many White House staffers who have departed in the last several weeks, never mind the last year. The president has seen so much turnover in the most senior ranks of his administration in this time.

Meanwhile, we do hear from the president that he wants to name a replacement for Gary Cohn soon. And among those people we're hearing from our sources could be Peter Navarro, who is another of Trump's economic advisers, someone who does favor tariffs, who has been clashing with Gary Cohn over this very issue, or Larry Kudlow, someone who is an ally of Gary Cohn's, an outside adviser to the president, but who opposes tariffs, who represents a little bit more of the view of the business sector here at the White House.

So a lot up in the air right now. But again, this sense of turnover and chaos in this White House is not abating just weeks into the new year, the second year of this president's term -- John.

BERMAN: On the theme of nothing to see here and no chaos, a heck of a story overnight involving the chief of staff, John Kelly, the president of the United States, and Anthony Scaramucci, the one-time briefly communications director.

Abby, what have we learned?

PHILLIP: That's right. Sources tell CNN's Kaitlan Collins that the president did nothing to discourage Anthony Scaramucci, a -- briefly the former White House communications from attacking John Kelly, the current White House chief of staff, on television in multiple cable news interviews. These attacks were pretty blistering. He blamed Kelly for the low morale here in the White House.

Meanwhile, all of this is unfolding and President Trump is actually saying he is not -- he does not view this White House as being in chaos at all. Listen to what he said yesterday briefly in that press conference.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I think two people with different points of view, and I certainly have that. And then I make a decision. But I like watching it. I like seeing it. And I think it's the best way to go. I like different points of view.


PHILLIP: Look, a lot of folks would clearly disagree with that. But there's no question there is a lot of upheaval here in this White House, and President Trump apparently did not a whole lot to stop it.

BERMAN: Abby Phillip at the White House this morning. Abby, thanks so much.

Joining me now, Salena Zito, a CNN contributor, Errol Louis, CNN political commentator, and Caitlin Huey-Burns, national political reporter for RealClearPolitics.

You know, Caitlin, the president is trying to paint this White House as sort of a team of rivals. You know, I don't recall Abraham Lincoln, you know, stabbing Salmon Chase in the back, you know, in the Doris Kearns Goodwin book. And also there's 43 percent turnover now in the White House. 43 percent turnover in the administration. That's according to Brookings right now.

You know, he doesn't like to use the word chaos but when you talk to people who are in the middle of it or were in the middle of it, that is one of the first words they use.

CAITLIN HUEY-BURNS, NATIONAL POLITICAL REPORTER, REALCLEARPOLITICS: Exactly. And he admitted as much in a way by saying he likes to pit people against each other and see who comes out on top. He also tweeted yesterday that he would like to see some change in the White House, but he's not sure exactly who will be. So what kind of morale that sets in a White House when you're hemorrhaging talent and trying to bring people in.

[09:05:05] With Gary Cohn leaving, too, I mean, it should be no surprise that the president is pushing for these tariffs. It's kind of the one consistent thing he has been on on this issue. But after the tax reform bill, a lot of Republicans thought that he was -- that they were kind of pulling him into their lane on economic policy. And now he is kind of showing that he is running the show. And so I think there's a lot to take away from that in terms of who wants to be there, will be someone who is much like Trump perhaps.

BERMAN: You know, there are a lot of questions this morning about what will be gone with Gary Cohn leaving and Hope Hicks leaving. Who is there, Errol, to counsel the president, maybe to temper the president, moderate the president. There are quotes all over the place this morning. Let me read you one in Politico from one White House official.

"The number of bad ideas that have come through this White House that were thankfully killed dead, there are too many to count. With Gary gone, I just think from a policy perspective, it means disaster."

ERROL LOUIS, CNN POLITICAL COMMENTATOR: Wow. Well, you know, it really sort of points to one key part of the quote that you played from the president where he says he likes to watch it, almost in a passive sense of desiring entertainment.

BERMAN: Like Peter Sellers in "Being There," but only a much more violent version.

LOUIS: Look, it's entertaining. I was thinking actually of the last few minutes of "Reservoir Dogs," Right? Where you have a standoff. These guys are supposed to be on the same team, all pointing guns at each other's heads because it may be entertaining to watch, but that's not a leadership value. That's not going to necessarily bring out the best policy decisions. And that's something I think the White House Press Corps should really press the spokespeople and the president himself on.

When is the last time this approach actually worked out for you? You know, I mean, you may want to see it. You may think it's a decent method. But did it work for you in your business life? Did it work for you in Hollywood? Did it work for you in the White House? By all indications, either it's not transferable from the private sector or maybe it didn't work out so well in the private sector in the first place.

BERMAN: So I'm going to read one more quote, this one from "The New York Times" and then, Salena, we're going to get the counter argument here. The "New York Times" says whoever replaces Mr. Cohn is unlikely to be any better than he is, and possibly quite a bit worse. No sound economist would risk his or her reputation by working in this administration." That's the "New York Times," that's a view of a certain sector here.

But the fact is that Donald Trump ran against Gary Cohn or people like Gary Cohn in the election. He ran that ad against Goldman Sachs. I mean, look, there were anti-Semitic tones in the ad, too, and there are other things about that ad that were controversial. But he made crystal clear that he was running against this Wall Street free market, globalist mentality.

SALENA ZITO, CNN CONTRIBUTOR: Yes, absolutely. I mean, you have to step back and take a look at what Trump has done outside of the palace intrigue. This is important reporting, but you have to step back and take a look at this through the eyes of a voter. So he has -- for his base, if you look at evangelicals, he has satisfied what they wanted from him with Gorsuch, and if you look at sort of rotary Republicans or Wall Street Republicans, he has satisfied them with the tax reform.

While on the tariffs, he is satisfying those voters, those Democratic blue-collar or independent or Republican-leaning voters in the rustbelt on trade. And when economists say, you know, this is terrible, this is bad for the economy, they say, hey, look, economists, you told us NAFTA was going to be great for us. And see how that worked out? So you have to look at how the voters, the people that put him into office and the promises that he made to them, how they view this. And for them, this is him having their back. And that's important to them.

BERMAN: I want to talk a little Kremlinology, I suppose we can hardly use that word anymore un-ironically. But, Caitlin, the question is who is now rising with Gary Cohn falling? And again I'm not just talking about the economic adviser part. Does this mean that John Kelly has more power? You know, Jared Kushner, where is he?


BERMAN: With the security clearance lower than the calligrapher? I mean, who is now the one whispering in the president's ear?

HUEY-BURNS: Right. Well, I think this demonstrates that John Kelly's power is not as strong as it was. And also remember the kind of the genesis of this was Rob Porter who was kind of seen as the gatekeeper and an ally of Cohn and able to at least keep the president kind of off or at least curb some of his demands on tariffs.

I think it also shows that Donald Trump is running the show here. And I think when you're looking at the broader agenda, the fact that Gary Cohn is leaving suggests that there really is no way to see, you know, infrastructure getting through as Gary Cohn or some Republicans want to see it or some other policies.

The president really exerted his leverage here. And I think when you're thinking about whether you want to enter this White House or not, that has to be a top consideration of who you are working for.

BERMAN: The president says there are 10 people, the 10 best people in any field lining up for every job.

[09:10:05] And Errol Louis, you know, you can argue whether or not he has surrounded himself with the best and the brightest. You know, he has people in there of great accomplishment in business and other fields as well. But it's just not true that they're having an easy time filling the jobs. It has been difficult for them and it's hard to see how it will get easier.

LOUIS: That's right. Statistically we just know that they're behind. I mean, look, some of this has to do with the apparatus being so broken or so non-functioning that they're not even putting forward the nominees, either because they don't have the names or they're not going out and aggressively and properly finding and vetting and putting forward the names. So that in itself sort of starts to create its own problems. Right?

It's very hard if you don't have leadership in certain departments, well, you can't sort of fill in the people who are supposed to be their team. So we've got I think in some ways a crisis, separate and apart from what Salena is talking about, which I think she's exactly right. I mean, the big broad strokes, is he moving forward major pieces of his policy initiative? Is he playing his politics right? Yes, arguably, he hasn't slipped any further. Right? He's got bad numbers but they haven't gotten any worse.

But as far as the actual running of the government, very hard to see how you make this turn around. Because the people who will run and who need to run these big agencies, they know solid sound management principles and they see that they are not being obeyed here.

BERMAN: And people on Wall Street know Gary Cohn. If he wants to recruit people on Wall Street, maybe the president doesn't, you know, I suspect those people will check with Gary Cohn to get a sense of what things are like inside.

Salena, I'm going to shift gears and we're going to talk much more about the Stormy Daniels-Stephanie Clifford lawsuit against the president. You know, what is in it and what it means legally. But I want to ask you politically, because I'm looking at this right now and it's an extraordinary document to file against a sitting president of the United States.

You know, the Stormy Daniels story has sort of simmered for the last several weeks. You know, more than a month now. It never really moves and I know this is a different kind of president and people knew what they were getting when they elected him.

ZITO: Exactly.

BERMAN: And that -- does that answer it, though? Does that inoculate him forever, for good? Because --

ZITO: I don't know that it inoculates him. But at this moment, it still doesn't degrade the support of the people that initially supported him. The "Access Hollywood" proved to everyone that with him people bought in -- they knew that that's who this guy was or is. They knew that that's how he behaved or did behave. They had known him for 20 years as this sort of entertainment and business person, and they accepted it, for whatever reason, whether it was because Hillary was so awful, whether it was because they wanted something better, whether because he just showed up in their town and nobody else had for generations and said, I want your vote and here is why I want it.

They were willing to put that aside. And that's why I think that the Stormy Daniels story is still in simmer mode and may never -- I'm not saying it won't, but may never rise to the level of upsetting this presidency, or at least disconnecting him from his voters.

BERMAN: Salena Zito, Errol Louis, Caitlin Huey-Burns, thank you very much.

All right. He sat in on secret meetings with President Trump's inner circle, now he's cooperating with the special counsel's investigation. What does this businessman know?

And the porn star suing the president. How a missing signature on a contract could lead to a whole lot more details about this alleged affair and payoff?

Plus we are just minutes away from the Opening Bell. The markets are shaken by the latest White House departure. Call it the Cohn moan. I just invented that.

Christine Romans watching it for us.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Oh, no, John. Let's stick to your day job, please.


ROMANS: Look, the stock market looks like it's in trouble here at the Opening Bell. Maybe 200 or 300 points on the Dow Jones Industrial Average. And that is because Gary Cohn is leaving and he was seen as a realist, someone who believed in free trade and was helping the president understand better sort of how a global free trade system works. He is out over disagreements over those tariffs.

And now Wall Street is concerned the president will be fully America First on the trade front and that will hurt investors. Opening Bell right after the break.



JOHN BERMAN, CNN ANCHOR: All right. New this morning, 28 pages of oh, my. This is the new lawsuit by Stephanie Clifford, a.k.a. Stormy Daniels a.k.a. Peggy Peterson filed against Donald Trump a.k.a. David Dennison. Leave aside the names for a moment. Another way to say it is this, a porn star just sued the president.

In the suit Daniels says that President Trump knew his lawyer, Michael Cohen, paid her hush money before the election to cover up a past affair. Daniels also argues a non-disclosure deal she signed is invalid because then Candidate Trump did not sign it. M.J. Lee joins me to explain what this is all about -- M.J.

M.J. LEE, CNN NATIONAL POLITICS REPORTER: John, the reason this is so significant is that remember, up until yesterday, Stormy Daniels was dancing around the issue of whether there was an affair, whether there was a NDA, whether she was paid off to keep quiet.

Now for the first time she's addressing all of these questions in writing in this lawsuit. A couple of the big headlines from this lawsuit, one, she says there was, in fact, an affair. She says there was an intimate relationship that started in the summer of 2006.

I should note this would have been a few months after Baron Trump was born and that this relationship continued well into 2007. She also says that she wanted to tell her story, her story about her relationship with Trump during the 2016 election. That she saw the "Access Hollywood" tape come out in October of 2016.

She saw that other women were coming out with their stories and sought to tell the media her version of her story. This is where things get really interesting, and I want to read from part of the lawsuit.

[09:20:04] She says, quote -- in the lawsuit, she says, quote, "After discovering Miss Clifford's plans, Mr. Trump with the assistance of his attorney, Mr. Cohen aggressively sought to silence Miss Clifford as part of an effort to avoid her telling the truth, thus helping to ensure he won the presidential election.

Now the lawsuit goes on to say that Cohen drafted the NDA as part of this, quote/unquote, "hush agreement" and that on or around October 28, 2016, just days before the general election, that Stormy and Cohen signed the agreement and that Cohen arranged for $130,000 to be sent to Stormy's attorney.

Now, importantly this lawsuit alleges that Trump himself did not sign the agreement and, therefore, they say the agreement is legally null and void and of no consequence. I want to read from another part of the lawsuit again.

It says that attempt to intimidate Stormy into silence and shut her up in order to protect Mr. Trump continued unabated. This includes the lawsuit says Cohen initiating arbitration against Stormy in Los Angeles just last month.

Now the lawsuit obviously gets to the very important question of did Trump himself know about this agreement? It's essentially saying yes, he did know, and Cohen acted with Trump's knowledge. In fact, take a listen to what Stormy Daniel's lawyer have to say about all of this, this morning.


MICHAEL AVENATTI, ATTORNEY FOR STORMY DANIELS: There is no question that the president knew about it at that time. The idea that an attorney would go off on his own without his client's knowledge and engage into this type of negotiation and interim this type of agreement quite honestly I think is ludicrous.

UNIDENTIFIED FEMALE: You make that inference. You don't know or can you prove that the president knew about this payment?

AVENATTI: We certainly haven't disclosed all the facts and evidence that we're aware of in connection with this.


BERMAN: Wow, that is Stormy Daniels' lawyer. M.J., stick around. I want to bring in Laura Coates, CNN legal analyst to talk more about the significance here, the significance that both Stormy Daniels and her lawyer flat out said there is a sexual relationship. What else is important here, Laura?

LAURA COATES, CNN LEGAL ANALYST: First of all, we have to unpack this, there's two different theories here. Whether it's void or voidable are two different distinctions in the court of law. Number one, to say a contract is void outright because one party has not signed it is actually not entirely true.

It doesn't outright void a contract if you have an implied contract here. If you have an offer, is it an offer to pay you $130,000 not to speak about the alleged affair and you accept that offer and you cash the check, you've got the three components of a contract there.

You have an offer, acceptance and consideration. You also have that this was signed in 2016 which means for the last almost two years they've been operating as if it was a valid contract, and the court of law in the civil contract. John, was it fair? Is it a matter of equity if they never existed?

Now there are ways to make it voidable. Meaning the contract existed but you can get out of it. In one way is to say that one of the parties did not abide by the terms of making sure it was, in fact, confidential.

Relying on Michael Cohen's own statement, there actually was an NDA and he paid the money to say that he has violated and now it's voidable. That's different in a court of law. Frankly, I think you'll have a very steep tale to say it never actually existed. Particularly if you've operated for the last year and a half that it did.

BERMAN: The big question here, Laura, is this lawsuit, is this a means to an end or these pages the end in and of themselves? I mean, was the idea to get this information out in a public way? COATES: It seems that it was, John. Think about this, for the last year and a half, they've operated under the premise that this was going to be confidential. Now there's interest in this and, of course, the "Access Hollywood" was one of the reasons that she wanted to get the story out.

She had gone to different tabloids to talk about the actual experience and the alleged affair. It seems as though this is more about provocation than actual litigation-based success. It gets the story out there and tries to get around the arbitration agreement aspect of it.

The reason she focuses on whether she was coerced or there was duress involved in signing the statements, about how she, in fact, did not have the alleged affair or sexual encounter with Donald Trump, was because she's trying to show that, if this contract is, in fact, sound, even absent one party's agreement, everything I said after that is under duress, which is one of the ways the court will say, a-ha, this is not a fair agreement to actually enforce. At the end of the day, this is more provocation than about success.

BERMAN: M.J., very, very quickly here. The White House hasn't directly responded to this, have they?

LEE: No. And I was actually looking up when the last time was that the White House was asked about this, I believe it was last month when Raj Shah was behind the podium. He was asked repeatedly about this and he kept saying I have not had a chance to ask the president about this. It will be very interesting to see what they say now, now that all of this is in writing.

[09:25:03] BERMAN: And that is the big part of this here, sooner or later the White House will have to address this and the president likely in some kind of public way might have to himself. M.J. Lee, Laura Coates, thanks very much. I appreciate it.

Moments from now, the Wall Street opening bell, how much will Gary Cohn's departure from the White House rattle investors. That's pre- market trading down 1 percent. Stick around.


BERMAN: The turmoil in Washington poised to pour over into Wall Street, 30 seconds from the opening bell. I'm joined by CNN chief business correspondent, Alison Kosik down on the floor of the New York Stock Exchange. What are you hearing as we are just seconds away now?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: It's certainly OK to say that nerves are frayed after the news about Gary Cohn quitting as economic adviser at the White House. Look, this is a market that's already rattled by rising interest rates, rattled by the proposed tariffs on aluminum and steel.

Gary Cohn leaving is making things worse. He was seen as a level- headed guy in the White House in the middle of all that chaos and now (inaudible) Trump to go ahead and put in somebody who is right wing or (inaudible) protectionist policies. So, we are seeing the Dow falling 100, 200 --