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ERIN BURNETT OUTFRONT

Trump Floated Replacing Sessions with Pruitt Amid Scandals; Trump Claims "Millions" Voted Illegally; Trump Revives Talking Point About Mexicans Being Rapists; Trump Breaks His Silence on Stormy Daniels Case; Trump: Looking to Send Up to 4,000 Troops to the Border; Trump Threatens New $100 Billion Tariffs on China. Aired 7-8p ET

Aired April 5, 2018 - 19:00   ET

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


[19:00:02] WOLF BLITZER, CNN ANCHOR: I'm Wolf Blitzer in THE SITUATION ROOM. ERIN BURNETT OUTFRONT starts right now.

ERIN BURNETT, CNN ANCHOR: OUTFRONT next, breaking news. The president not only sticking by his EPA chief but floating replacing Attorney General Jeff Sessions with Pruitt. This, as more shocking accusations pile up tonight against Scott Pruitt.

And more breaking news this hour, the president just throwing out another bomb on China, talking about another $100 billion in tariffs.

And Trump breaking his silence tonight on Stormy Daniels.

It's a busy night. Let's go OUTFRONT.

And good evening, I'm Erin Burnett. OUTFRONT tonight, the breaking news. CNN has learned President Trump talked this week about promoting the embattled EPA Chief Scott Pruitt to replace Jeff Sessions as attorney general of the United States of America. This, as an avalanche of news is breaking about various scandals involving Pruitt.

In fact, late today aboard Air Force One, the president said Pruitt is fantastic.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I think that Scott has done a fantastic job. I think he's a fantastic person. You know, I just left, I just left coal and energy country. They love Scott Pruitt. They feel very strongly about Scott Pruitt and they love Scott Pruitt.

(END VIDEO CLIP)

BURNETT: Fantastic job. Pretty damming word choice given what we are reporting at this hour. At least five EPA officials have been sidelined after raising serious concerns with Pruitt about his spending and management according to "The New York Times." That includes Kevin Chmielewski, one of the first employees of the Trump campaign itself. According to "The Times," Chmielewski objected to a proposal for a $100,000 a month private plane charter membership for Pruitt. He also objected to a proposal to spend $70,000 for two desks in Pruitt's priority office suite. Yes, you heard me correctly, two desks for $70,000 U.S. dollars.

Chmielewski raising some of his concerns about spending with Pruitt directly and taking some of his concerns to the White House Personnel Office itself. Well, what was the price for that? Chmielewski currently on administrative leave without pay.

To be clear, the list of inappropriate spending is getting longer and the price tags bigger, and the president is talking about promoting Pruitt to replace Sessions. President Trump is standing by his man, even after this performance.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: President Trump said he would drain the swamp. Is draining the swamp renting an apartment from the wife of a Washington lobbyist?

SCOTT PRUITT, EPA CHIEF: I don't think that that's even remotely fair to ask that question.

UNIDENTIFIED MALE: Why did you go around the president and White House to give pay raises to two staffers?

PRUITT: I did not. My staff did and I found out about that yesterday and I changed it.

UNIDENTIFIED MALE: Who did it?

PRUITT: Maybe there would be some accountability --

UNIDENTIFIED MALE: A career person or political person?

PRUITT: I don't know. I don't know.

UNIDENTIFIED MALE: You run the agency. You don't know who did this?

PRUITT: I found out about this yesterday.

(END VIDEO CLIP)

BURNETT: Pruitt's answers speak for themselves, as do these reports of his egregious behavior. Things like requesting a 24-hour security detail, security that extended to a family vacation to Disneyland and the Rose Bowl. Pruitt also rocking up more than $150,000 in first class travel, more than 30 grand spent on his security detail alone during a trip to Italy. And then there's this ridiculously cheap $50- per-night lease for a Capitol Hill condo from a wife of a lobbyist. A wife -- I'm sorry, a rate thousands of dollars lower than market value on a monthly rate.

Bypass -- Pruitt also bypassing the White House to give large pay raises to two aides and it doesn't stop there. We're learning tonight about a request that lights and sirens be used to get Pruitt around town because he's often running late.

And yet, let's listen to President Trump again.

(BEGIN VIDEO CLIP)

TRUMP: We're going to drain the swamp of corruption in Washington, D.C.

We're going to drain the swamp of corruption in Washington, D.C. And stop government officials from trading favors at your expense.

It is time to drain the swamp and that's what we're doing in Washington D.C.

(END VIDEO CLIP)

BURNETT: We'll see if he keeps his word when it comes to Scott Pruitt, the man tonight he said was fantastic. Fantastic, apparently, to talk about promoting this week to replace Jeff Sessions as attorney general, the attorney general who has recused himself from the Russia investigation.

Jeff Zeleny is OUTFRONT live at the White House. And Jeff, the president is forced to address this report of promoting Pruitt to attorney general.

JEFF ZELENY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Erin, he was, and he quickly pushed back on that saying that he has no plans to do that. He believes Scott Pruitt is doing just fine where he is.

But interesting, we have seen the president say similar things for other cabinet secretaries, that there's no change planned and we know of course that there's a long list of cabinet secretaries, senior advisers who are no longer here.

[19:05:02] I can tell you tonight based on a day's worth of reporting, Erin, that the president was not pleased at all by that Fox News interview. He called it an interesting interview. We know he was watching it just off the Oval Office. That was supposed to clean things up. It did not clean things up.

But this is what is different about Scott Pruitt, Erin. There are a variety of conservative supporters and forces who are urging the White House and the president to leave Scott Pruitt in place. Not because of the ethics scandals, they don't care about that nearly as much as the policies that he is putting in place. He's rolling back the Obama era administration regulations bit by bit here. It's one reason Ted Cruz, Rand Paul and other senators have come out in support of him. They like what he is doing in a substantive matter.

That is different than some of the other cabinet secretaries who've been shoved aside because of these, you know, overspending or ethical issues here. So that is what the president is going to have to decide himself if A, he doesn't like these bad headlines more than he likes the conservative support for him. That's why tonight we do believe he is on probably more solid ground than he was earlier in the week, but again, this is the president's choice day by day. He'll decide this on a whim.

Erin, one other thing.

BURNETT: Yes.

ZELENY: Difficult to confirm a new EPA administrator. They think this would, you know, take months to do. So some people want to leave Scott Pruitt just where he is.

BURNETT: All right, and now, of course everyone knows that the president when it comes to this, he want to make a lot of changes and he pick someone who did so the replacement would the same. Obviously, they got a lot more of pushback perhaps than they did first time around.

Thank you so much, Jeff Zeleny.

And OUTFRONT now, Democratic Congressman Jamie Raskin of Maryland, also the vice ranking member of the House Judiciary Committee.

Congressman, thank you for your time tonight. You're one of the first to call for Pruitt's resignation. And that obviously is not happening at this moment and, in fact, the president is not pressuring him to resign. He is calling him fantastic person, fantastic job tonight on Air Force One, and we're reporting talks about promoting him to attorney general this week, as all of this avalanche of ethical questions was being raised.

Your reaction?

REP. JAMIE RASKIN (D), VICE RANKING MEMBER, JUDICIARY COMMITTEE: Well, Donald Trump has a staff infection and Scott Pruitt is the poster boy for the most ethically corrupt and compromised administration of our lifetimes. It's remarkable that he's still in office, even with what we know just now and that the president is standing by him.

The guy has the real estate deal of the century in D.C. paying 50 bucks a night to the wife of a prominent energy lobbyist whose firm has multiple clients with millions of dollars worth of business before the EPA, including ExxonMobil and Cheniere Energy and Stanley Black and Decker. He appointed to take over the Superfund program, a guy who had loaned him hundreds of thousands of dollars to buy a house and to buy an interest in a baseball team. The guy has absolutely no history at all in environmental protection and he's head of the country's Superfund program Cleanup all because of this personal relationship, and he's making I think $160,000 or $170,000 a year and he's been banned from doing banking in America by the FDIC because of various transgressions.

So, this is just an ethical sewer. The only swamp in the country or the only wetland that the EPA chief has been protecting is the ethical swamp in Washington. And it's just amazing to us that this guy is still in office. The dozens of members of Congress, including several Republicans now to follow through his resignation.

BURNETT: Yes. I mean, others obviously including Rand Paul, have come, you know, strenuously to his defense. But, you know, we're also learning tonight, Congressman, the several senior EPA officials have been sidelined, even suspended for raising concerns about Pruitt's spending. The New York Times is reporting of a proposal for $70,000 for two desks in his office suite. And the New York Times says some of these concerns by senior EPA officials about spending were brought directly to the White House Personnel Office.

So all of this has happened in the past. We've seen people demoted, suspended without pay, reassigned to less prestigious roles and this has been happening over months before any of this broke in the media. Your reaction?

RASKIN: Well, this is the pattern. You know, they're appointing foxes to supervise the hen houses and predictably there are conscientious public servants in all of these agencies and departments including even some political appointees, but certainly, the civil servants who are blowing the whistle. And then they retaliate against the government employees who complain about stuff, like Pruitt spending I think more than $180,000 on travel, foreign travel, first class air tickets all over the country.

[19:10:03] He's the first EPA chief in memory who travels with a complete security detail which is just absolutely unprecedented. What's going on here?

BURNETT: So, you know, the top Democrat on the Oversight Committee, of which you're also a member, is calling for a hearing with Pruitt and his top aides next week. Do you think Pruitt will still be there next week or will the president fire him?

RASKIN: Well, here's what we're hearing, that -- you know, they understand that he's at the center of this corruption scandal now and it's engulfing him and the rest of the cabinet and of course the president himself who is the emoluments king. But they seem to be doubling down for him because he's doing precisely what he's been sent there to do, which is to turn over EPA regulation basically to the polluters in America. So they're dismantling the legal and regulatory apparatus we have to try to protect clean water and clean air in the country.

So, it's a remarkable thing. If you're willing to give the store away, they'll stand by you no matter how much you're spending on foreign travel or fancy furniture or how much your -- you know, bringing in all of your buddies and business partners to hold high public offices.

BURNETT: Congressman, thank you very much. I appreciate your time.

RASKIN: Thank you so much.

BURNETT: And OUTFRON now, Patrick Healy, politics editor at "The New York Times." And obviously, this report from you guys tonight is pretty stunning. I hope everybody reads it. PATRICK HEALY, POLITICS EDITOR, "THE NEW YORK TIMES": Yes.

BURNETT: And, you know, we're referring the president was even as all of this was breaking, saying -- you know, talking about promoting Pruitt to take over Sessions, you know, whom he always criticizes for recusing from the Russia investigation. You know, he said something that when he's doing a fantastic job, he said, just came from oil and coal country and they love him.

HEALY: Right.

BURNETT: Is it still worth it for president to stand by his man?

HEALY: It's -- he's sort of divided on this because he needs the Fox News base unless we know Fox News was going pretty hard at Pruitt with this sort of top questions that Pruitt couldn't answer. The base also hates waste, fraud, and abuse. And like $70,000 for two desks? I mean, this is what Republicans traditionally --

BURNETT: I mean, it's a stunning number.

HEALY: Yes, this -- and this is what they ran against. So, you're going to see (INAUDIBLE) to think sort of the Republican base getting, you know, uncomfortable with this guy. But here's the thing, Scott Pruitt has been from the Republicans' point of view, one of the most effective members of Donald Trump's cabinet for big business, for energy, for coal in a lot of those red states that he cares about, and including places like West Virginia where they got a competitive Senate seat held by a Democrat now.

They really like Scott Pruitt. They like what he's done with deregulation on the EPA. So the -- it's an interesting one because normally, you know, it's Friday and tomorrow's Friday, the weekend, the president is going to be in D.C. Usually, you'd see the big shake-up come but this is a tough one.

BURNETT: It's a tough one and of course by the way, if $79,000 a desk is a problem, $31,000 for a table should be a problem, and a $139 originally for a door should be a problem. So, as goes Pruitt, we have to go Carson and Zinke, and then you have a massive crisis. I mean, you know -- but also on this, you know, you've been reporting -- you know, Jeff Zeleny was just reporting about that John Kelly is saying, get rid of him and the president is completely disregarding his chief of staff.

HEALY: Yes, their relationship changed at least a few weeks ago where Donald Trump has wanted for a long time to be free to make the decisions, especially on administration that he wants to make. And he knows that the narrative and the media was that John Kelly was brought, he's going to bring the president to heel.

BURNETT: To be the grown-up, you know, to watch the --

HEALY: Absolutely, absolutely. But you've seen now this succession of people that Donald Trump has moved out. I mean, you know, he moved out McMaster, you know, he moved out Rex Tillerson at the State Department. The thing with Scott Pruitt actually has a constituency, he's popular with Republicans.

McMaster was never like a base guy. So this is going to be trickier for Trump. But John Kelly, you know -- I mean, he's sticking to the same message but if the president wants him to stay, you know, Pruitt may be hanging on.

BURNETT: All right, thank you very much for putting it pretty well. Patrick, thanks.

And next, Donald Trump unhinged today talking about conspiracy theories and Mexican rapists.

(BEGIN VIDEO CLIP)

TRUMP: Women are raped at levels that nobody's ever seen before.

(END VIDEO CLIP)

BURNETT: Plus, the president is breaking his silence today on Stormy Daniels. For the first time, opening his mouth directly about the payment. Daniels' attorney says their case just got a whole lot better.

And Trump's plan to send troops to the border. Why is the administration still stumped on the most basic question about the plan?

(COMMERCIAL BREAK)

[19:18:23] BURNETT: Breaking news tonight, President Trump deciding to go unhinged today, literally throwing out his prepared remarks like that and instead saying things like this.

(BEGIN VIDEO CLIP)

TRUMP: This was going to be my remarks. It would have taken about two minutes but (INAUDIBLE). That would have been a little boring. Little boring.

In many places like California, the same person votes many times. You probably heard about that. They always like to say, oh that's a conspiracy theory. Not a conspiracy theory, folks. Millions and millions of people.

(END VIDEO CLIP)

BURNETT: It is false. Let's just be clear.

OK, OUTFRONT now, former Republican candidate for New York governor and friend of Donald Trump of more than 15 years, Rob Astorino. And national affairs correspondent for the Nation, Joan Walsh.

OK, Rob, he had a speech.

ROB ASTORINO, FORMER CANDIDATE FOR NEW YORK GOVERNOR: Yes.

BURNETT: He was ready to talk about something substantive and important, tax reform and his view of that was.

ASTORINO: Which was more exciting.

BURNETT: Oh, it was definitely more exciting but now here we are talking about millions of people voting many times, which I just want to make sure everyone understands. Republican after Republican, secretary of state in this country has said it is false, that the voter fraud commission set up by this president was disbanded because this is false and yet here we were today.

ASTORINO: You know what I think what he does, I'm not making excuses and I'm no psychologist but I think there's a kernel of truth or it's a couple of steps ahead, meaning I don't think -- and I think most people don't think there were two million people who voted illegally. But, I do think because I was in the system, I was a county executive, I was involved in elections, I could see how easy it is to commit fraud.

[19:20:02] All you have to do, in New York especially, just fill out a form, you don't show I.D., you send it in, and really, anyone can show up.

JOAN WALSH, NATIONAL AFFAIRS CORRESPONDENT, "THE NATION": Oh, it can happen. But --

ASTORINO: So it can happen.

(INAUDIBLE)

BURNETT: He brings up California. California had 948 pieces of suspected fraud in the election, 89 of them were investigated, OK, so not all of them were investigate.

ASTORINO: Right.

BURNETT: And maybe some of those others are. Of those 89, 56 were alleged double votes. So if you go ahead and say, 60 percent of the total, so 900, 48, I mean, I'm going to give him the benefit of the doubt. I'm going to say there were about 500.

WALSH: And that's a lot. That is giving him the benefit of the doubt.

BURNETT: That's the benefit of the doubt.

WALSH: They will ever find --

BURNETT: (INAUDIBLE), he said millions and millions.

ASTORINO: (INAUDIBLE) that's wrong.

(INAUDIBLE)

WALSH: I think it was a giant gesture and not one of respect to John Kelly and his staff. I've got this piece of paper, here's what I think about it, and I'm going to joke -- BURNETT: This is boring.

WALSH: This is boring.

ASTORINO: But he's playing to the crowd.

WALSH: He's playing to the crowd but he's also -- it's also a gesture to his staff, you can't control me. I feel bad for my friend Rob. He could be here tonight -- I mean, week after week we talk to our Republicans friends and they say I want to talk about tax reform, I want to talk about the economy

And, it's not Erin or I who keep Republicans from talking about that, it's Donald Trump himself.

BURNETT: And, you know, look, here's the thing. We have Stephen Moore and Robert Reich coming on later this on, two economists, right, and we were going to be talking about Amazon, well, guess what, the president decide he wants another hundred billion in China tariffs which he just throw out there.

ASTORINO: That's a game of poker. He puts 50 million chips in, and -- 50 billion, and then China puts 50, he goes up to 100.

BURNETT: OK. So not only did he repeat something completely false about (INAUDIBLE) which it hurts confidence in the system, and again, I want to make it clear, congressional Republican secretaries of state across this country have said it is false, right. This is not a partisan issue, this is people (INAUDIBLE) in their vote.

ASTORINO: Right.

BURNETT: And regardless of whether there are individual cases of fraud. He then went back to the issue reminding everybody when he said that, you know, some of the people coming into this country are good people but a lot of them are rapists from Mexico. And he brought that up today instead of reading the prepared remarks. Let me play it.

(BEGIN VIDEO CLIP)

TRUMP: And remember my opening remarks at Trump Tower. I used the word rape. And yesterday it came out where this journey coming up, women are raped at levels that nobody's ever seen before.

(END VIDEO CLIP)

BURNETT: OK. Very off topic for today but they are defending this (INAUDIBLE). Sarah Sanders is saying it's a well established fact that women and young girls are brutally victimized on the journey north. He's referring I guess specifically to the caravan it appears. Amnesty International says 60 percent of female migrants are victims of sexual abuse and that they don't even think that that's accurately reported, it's worst than that.

WALSH: That it could be worse. BURNETT: So, even though this was completely off topic today, and he certainly did not need to create a word echo of what he said about that.

WALSH: No, he's just proud of it.

BURNETT: Is he right though about raising this issue?

WALSH: He's right to raise this issue, Erin, if he raised it in order to do something about it. I mean, this is sad because it is an issue where Republicans and Democrats do often get together. The issue of sex trafficking generally is horrible and specifically crossing the border. It is a real issue but what is he proposing to do about it? What did he say today beside exciting the crowd and getting to call Mexicans rapists one more time?

BURNETT: I mean, why would he bring up what he said in Trump Tower which is Mexican are rapists that they are sending north?

ASTORINO: What he's been doing is, he's been saying it for the whole campaign and since he's been in. The border wall to him is important for security reasons but the whole immigration process --

BURNETT: To keep out rapists?

ASTORINO: Well, to keep out bad people coming in. Look, I give this metaphor to people, if you see a whole bunch of people walking down your block and they come to your door, are you going to answer it or you're going to through the peephole or ask who it is? And that's what's happening in our country. We're kind of just letting them walk on our property and walk --

WALSH: No, it is not what's happening in our country. We have --

ASTORINO: Well, there's poor border, completely poorest border.

WALSH: We have -- we've upped border security. President Obama upped --

(INAUDIBLE)

WALSH: Right. We've actually got fewer -- we've got more people leaving than coming in across that border now.

ASTORINO: Since he came in because he's talking about immigration.

WALSH: It started under President Obama.

ASTORINO: Not with these kind of numbers. Not at all.

WALSH: It started under President Obama.

ASTORINO: But I think the issue what he's getting at to is, if you can control immigration, people coming in the way they're supposed to and not have to rent a coyote who is going to do bad things to people, that's unequivocal. We know that that's happening. WALSH: Right.

BURNETT: Can I just say, if you want to control immigration, you need to do it at the airports. Because that's how many people come into this country --

(INAUDIBLE)

WALSH: Exponentially, that is how people come into this country illegally. The issue is actually not the southern border.

BURNETT: Maybe an issue there.

ASTORINO: But on the issue of --

(INAUDIBLE)

WALSH: -- throw this issue out and call them rapists and say, rape, rape, rape. It just demagoguery. It's not a proposal to here's how we crack down, or here's how we stop the coyotes, here's how we find them. It's --

ASTORINO: But the topic is a meaningful one. And even -- you know, everyone agrees these bad things are happening to women.

BURNETT: And we're talking about a debunked conspiracy theory and millions of Americans voting illegally and Mexican rapists in his original Trump Tower speech tonight.

[19:25:03] That's what we just talked about.

ASTORINO: Yes, yes.

BURNETT: Because he chose to literally throw his speech on the air.

All right, next, Trump speaking out for the first time about Stormy Daniels. Here he is.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Did you know about the $130,000 payment to Stormy Daniels?

(END VIDEO CLIP)

BURNETT: The answer is next.

Plus, Trump deploying National Guard troops to the border. So, will they make a difference? Ed Lavandera on the border talking to agents tonight.

(COMMERCIAL BREAK)

BURNETT: Breaking news, tonight, President Trump breaking his silence on Stormy Daniels. You know, look, it's been months since the story broke and about two weeks since her interview aired on 60 Minutes. Literally about three months since the Wall Street Journal first broke the story that President Trump's attorney, Michael Cohen paid the adult film star $130,000 in hush money days before the election.

So tonight, for the first time, the president opens his own mouth on this and here's what he said.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Did you know about the $130,000 payment to Stormy Daniels? Then why did Michael Cohen say this?

(INAUDIBLE)

TRUMP: You'll have to ask Michael.

(INAUDIBLE)

UNIDENTIFIED FEMALE: Do you know where he got the money to make that payment?

TRUMP: No, I don't know.

(END VIDEO CLIP)

BURNETT: OUTFRONT now, Paul Callan, former prosecutor and CNN legal analyst, and John Dean, former Nixon White House counsel and CNN contributor.

Paul, Stormy Daniels' attorney, Michael Avenatti responding saying, "Our case just got that much better. And we very much look forward to testing the truthfulness of Mr. Trump's feigned lack of knowledge concerning the $130,000 payment as he stated on Air Force One. As history teaches us, it is one thing to deceive the press and quite another to do so under oath."

Your reaction?

PAUL CALLAN, CNN LEGAL ANALYST: Well, there's nothing new in Avenatti's statement. He's been saying that for a while. But he has a federal judge who's warned him not to bring a motion for an expedited deposition of the president into court unless there's something else that happens, a motion to compel arbitration and that has not happened.

So, I think you're not going to see anything happen with Avenatti, at least in the next few days.

BURNETT: So, John, what do you think though about this fundamental point right that the crucial thing that happened tonight was that the president answered the question. That has not happened before, all right? That's been the whole thing. For three months, he has not said anything. Now, he has come out and said something.

Do you think he's telling the truth?

JOHN DEAN, FORMER NIXON WHITE HOUSE COUNSEL: It's very suspect that he's telling the truth. I think he didn't want to respond to a question he got forced into answering, saying something, so he had little choice. But, you know, Erin, he's handled this whole thing differently than most of his perceived enemies where he goes after them and he's on the offense.

Here, he's been solely on the defense and I keep wondering what else is larger for him in this issue. Does he have some sort of prenuptial that's at risk? Does he have some sort of post-nuptial that's at risk?

I don't know. I think something else is going on here and he's very defensive on this one.

BURNETT: Yes, I mean, certainly, he has never come out aggressively against her as he has with other women who have accused him of unwanted sexual assault or advances. Obviously, Stormy Daniels had said this was consensual.

The crucial question here though, Paul, is that, you know, the reason that this whole situation matters, there's multiple reasons, putting aside the ethics and the character of the president of the United States, it's was there a violation of Federal Election Commission law, with a money to pay someone off and influence the election, and there's the risk with precedent of Bill Clinton of whether the president of the United States could be called under oath and caught for lying on this.

CALLAN: Oh --

BURNETT: Does it matter that now he's actually come out and spoken? Right now, he has said something. Now, it was to the press, but he has said something.

CALLAN: Yes, he has and I think what we're seeing is the defense was kind of laid out by Michael Cohen at the beginning, which is, this is my money, I paid the money, it wasn't the president who paid the money, and I think that what he's setting up here is the defense that Michael Cohen was kind of given general authority to settle cases and deal with women who may have these sorts of allegations against him. I'm betting Cohen knows where a lot of skeletons are buried.

BURNETT: Certainly.

CALLAN: And all of that may come out if the president has to testify under oath about this. So, he will do everything possible to avoid testifying under oath.

BURNETT: And, John, you know, Michael Cohen spokesman David Schwartz put out a statement in response to the president's comments and he said, this is an accurate assessment of the facts. This is exactly what I have been saying all the way along, Michael Cohen made the payment to protect reputation, family and business. It had nothing to do with the election. Now, of course, look, I think we all know full well that Michael Cohen would have expected to be paid back, right? But the president may not have known to your point, right? May have been a general authority and the president didn't ever know about this specific payment.

And Schwartz's argument is consistent, you know, here's what he -- the news he broke on this with us last week on this show.

(BEGIN VIDEO CLIP)

BURNETT: Can you say unequivocally that the president was never in any way aware of $130,000 of the agreement itself?

DAVID SCHWARTZ, MICHAEL COHEN'S LAWYER: The president was not aware of the agreement. At least Michael Cohen never told him about the agreement. I could tell you that, and you asked a whole bunch of questions so let me let me cover that. So, you asked about 12 days before --

BURNETT: Not aware about the agreement, what about the money?

SCHWARTZ: He was not aware about any of it.

BURNETT: OK.

SCHWART: He was not aware.

BURNETT: OK.

(END VIDEO CLIP)

BURNETT: Now, of course, this caused a brouhaha, John, because people said, well, if he wasn't aware, then that would mean the NDA itself is indeed invalid. Does anything the president said tonight change this?

DEAN: I don't think anything changes and I think Paul is correct in pointing out it's going to take a while for this to proceed. The federal judge is not going to expedite it, so this will just have to play out in its own time and the question is whether it'll go to arbitration first and whether I'll get a chance to test the arbitration before it happens. So, we're just inching a little bit along with this latest statement that could cause later jeopardy for the president. We'll see.

CALLAN: You know, John Dean will remember this, but what Trump needs here is what Nixon had when he was accused of having a slush fund that was used and that was a dog named Checkers. And that gotten Nixon off the hook, but Trump doesn't have a dog. So, I think the press is -- he's going to have a lot more trouble than Nixon.

BURNETT: Well, and, of course, with the Clinton, you know, precedent, we shall see. You know, if he does get questioned by Bob Mueller, does this come up? Is this the sort of perjury issue that could cause a problem? Thank you both.

And next, President Trump wants to send thousands of troops to the border to bolster security, giving us the number tonight.

(BEGIN VIDEO CLIP)

[19:35:05] UNIDENTIFIED FEMALE: I don't think sending troops is going to solve anything.

(END VIDEO CLIP)

BURNETT: We are live on the border, divided by the president's decision.

And breaking news, literally moments ago, Trump throwing a major bombshell, considering another $100 billion in tariffs and markets after the close are plunging on the news.

(COMMERCIAL BREAK)

BURNETT: Tonight, President Trump says he's looking at sending two to four thousand National Guard troops to the Mexican border, the first number we've gotten. And one of the first and only details of the administration is provided on Trump's plan, earlier today, Trump's secretary of homeland security did not have the answer to that basic question.

(BEGIN VIDEO CLIP)

REPORTER: Any word yet on how many troops and when they'll be going?

KIRSTJEN NIELSEN, HOMELAND SECURITY SECRETARY: So, we're going to send as many trips as we need to get the mission there.

REPORTER: There's no number?

NIELSON: No number.

(END VIDEO CLIP)

BURNETT: She didn't have them but he apparently did, so are thousands of National Guard needed.

Ed Lavandera is OUTFRONT on the border tonight.

(BEGIN VIDEOTAPE)

ED LAVANDERA, CNN CORRESPONDENT (voice-over): When night falls in Laredo, Texas, Priscilla Villarreal hits the streets, documenting crime scenes to her Facebook page titled "La Gordiloca", which translates to "the crazy fat lady".

[19:40:08] PRISCILLA VILLARREAL, "LA GORDILOCA": I mean, I would lie if I'd say it's the safest city in the world but it's not.

LAVANDERA: She's irreverent, outspoken and rarely startled by anything she sees in this border town.

VILLARREAL: As you can see, we have our border patrol agents. We're at the corner of Louisiana and Napoleon.

LAVANDERA: Like this high-speed chase that ended in a dramatic crash in the middle of a neighborhood.

VILLARREAL: Several people were transported to a local hospital. It is being said that they were all undocumented people.

LAVANDERA (on camera): When President Trump says that he needs to send troops down to the border because it's a lawless place, how do you react to that?

VILLARREAL: I think -- I think he's wrong. I mean, I think we have enough authority in town to cover whatever is happening in our town. I mean, I don't think sending troops is going to solve anything.

LAVANDERA (voice-over): Despite what Villarreal sees most nights border towns consistently ranked as having some of the lowest crime rates in the country, so the idea of bringing in the National Guard isn't popular among most residents.

(on camera): President Trump says 2,000 to 4,000 National Guard soldiers will be sent to the border until the wall is built. In the past, these soldiers have worked in supporting roles, not here on the front lines like the banks of the Rio Grande.

(voice-over): National Border Patrol Council spokesman Hector Garza says the border patrol force is 2,000 agents short of being fully staffed. National Guard soldiers can fill the void.

HECTOR GARZA, NATIONAL BORDER PATROL COUNCIL: This is about saving American lives, saving our border patrol agents lives so they don't get assaulted, so they don't get killed, so they don't get injured.

MARTIN CUELLAR, WEBB COUNTY SHERIFF: We can see up to five miles, is that correct, up; to five miles.

LAVANDERA: Webb County Sheriff Martin Cuellar says a better way to boost border security is through technology. His department currently only has one camera, today capturing the movements of an unsuspecting rancher two miles inside Mexico. He's lobbying lawmakers to invest in a $92 million dollar plan that would equip local law enforcement agencies with drones, sensors and more cameras.

CUELLER: This is a force multiplier and this is only the camera system. We're talking about we're missing drones, were missing the sensors, were missing all those technology that could, you know, be deployed and better secure the border.

LAVANDERA (on camera): So, you'd much rather have this federal money for your technology and truth?

CUELLAR: Absolutely, absolutely without a doubt.

VILLARREAL: Can't they do the job themselves?

LAVANDERA (voice-over): Priscilla Villarreal says border towns are now used to the intense presence of law enforcement, border patrol, state troopers local police can all descend on any crime scene. It's the new way of life on the border.

VILLARREAL: I've been living in the city for many, many years, and you get used to everything that happens in this city. It's just normal for us. It's normal.

(END VIDEOTAPE)

LAVANDERA: Erin, Pentagon officials say that these National Guard soldiers will be working in roles that include aviation, engineering, surveillance, communications, vehicle maintenance and logistics support, and that is probably not all, especially President Trump alluding to the fact that he envisions military forces also being used at some point to build parts of the new border wall, even though he has long said it would be Mexico that would be paying for it -- Erin.

BURNETT: All right. Thank you very much, Ed Lavandera. Showing you what they actually think on the ground.

And next, breaking news, Trump moments ago upping the trade war with China, in a massive way. Remember there were $50 billion and China said, well, $50 billion back? Well, the president of the United States has just said he wants to add another $100 billion, hundred billion, against China. Markets are plunging on that news already.

And Jeanne Moos on what Trump and Kim Jong-un have in common.

(COMMERCIAL BREAK)

[19:47:39] BURNETT: Breaking news: Dow futures down more than points in the last hour after President Trump just said that he wanted another hundred billion dollars in tariffs considered against China.

It's a pretty stunning thing considering where we are, the two largest economies in the world in this right now stocks in the U.S. after the close of market are down about 400 points. They were up at the close and the belief that this was all a bunch of barking and no biting, now down 400, and we'll see how Asian markets open in the next hour.

OUTFRONT now, Stephen Moore, former senior economic adviser to the Trump campaign, and Bob Reich, U.S. labor secretary under President Clinton and also the author of the new book "The Common Good".

Steve, what the heck is going on here?

STEPHEN MOORE, FORMER SENIOR ECONOMIC ADVISER TO THE TRUMP CAMPAIGN: You know, this is a significant new development if it is true and I don't have verification of that yet, but if Trump is talking about the potential of another billion dollars of tariffs on Chinese goods. You know, this would -- because what's happened in the last couple days, Erin, as you know is Larry Kudlow, the new chief economist for Donald Trump basically calmed the markets significantly by saying, well, there's not going to be a trade war with China, and then the market went way up as you know.

BURNETT: Yes.

MOORE: And now, you know, there is a new worry about trade war.

I have to say, I find myself in general agreement with where Donald Trump is on this. I think that China -- you can't have free trade with the country the cheats and steals. They are -- they are saber- rattling and in building up their military. They're facilitating the North Korea situation with respect to the nuclear weapons. And the question I would ask, you know, you guys is, you know, can you really have free trade with the country that's cheating and stealing and as an adversary of the United States?

BURNETT: So, let me just be clear here so that both of you understand. There's a statement out from the president and in it, he said, in light of China's unfair retaliation, I've instructed the United States trade representative to consider whether a hundred billion dollars in additional tariffs would be appropriate, OK? So, it's not a report of what he's thinking. It's his own statement, just to make that clear so everyone understands, and that's why markets are dropping so sharply.

Bob Reich, your --

(CROSSTALK)

MOORE: And, by the way, Erin, I'm not -- I'm not entirely surprised about this because Trump is a counter puncher, you know? And what instigated this was when China said a few days ago that they were going to start imposing, you know, additional tariffs on American goods.

BURNETT: Well, no, no. I mean, look, you can go back onto all the things that started it, right? And that's a very fair conversation to have.

[19:50:00] But in the immediate term when the president said $50 billion, China said $50 billion, and now, he said $100 billion. So, I think we're all well aware of what's going to happen here. That's not a good spiral, and it's not a good thing to say you're going to do it and then not actually do it either, because then it makes you look like you're just a big fat bluffer.

So, what should happen here, Bob Reich?

ROBERT REICH, FORMER CLINTON LABOR SECRETARY: Well, here's the danger and the markets are responding to the danger. The danger very clearly is a trade war. The danger was not that great initially when the bluff was about, you know, aluminum and steel. But then it got more serious when it went up to $50 billion, $60 billion on Trump side.

And the Chinese, remember, responded by the same amount --

BURNETT: Yes.

REICH: They're going to respond exactly the same way now. They're going to say, OK, you want to play that way, counter-puncher, we're going to counter punch even greater with $100 billion of potential tariffs on American exports, farm exports, all kinds of small businesses will be hurt. American companies and American workers will be hurt.

The big global American companies are not going to be hurt because they can -- they can get into the China market from any cut -- any place around the world. The real people are going to be hurt our American workers and the small businesses.

And this is -- when Steve Moore talks about counterpunching, you know, this is -- this is fine for a -- for a schoolyard. But where there are no adult supervision, where there's no adult supervision any longer, this becomes incredibly dangerous and that is exactly what investors understand and that's exactly what investors are doing.

BURNETT: But president -- the reason the market went up is because people believe Larry Kudlow and they believed Wilbur Ross when they said, you know what, this is a negotiation and basically don't worry, we're going to use this as a negotiating tool and it's not going to happen. Well, then, the president comes out and said a hundred billion dollars, so he's undermining what his own team just said and he's raising a question, right, because at some point, the more you keep throwing numbers out there and you don't actually do any of it, do you lose credibility?

REICH: Erin, Erin, without any negotiation going on.

MOORE: Well, but, look, here's the point -- I mean, I -- you know, look, do we -- are we going to continue to allow China it's bad behavior? Are we going to continue and fine -- I mean, I've talked to a lot of people in the last week, Erin, liberals and conservatives says, it's about time a president got tough with China. I mean, this shouldn't have happened --

BURNETT: But, Steve, what about this issue of Larry Kudlow and Wilbur Ross coming out and saying something different? It does look like he's undermining them. And, by the way, Larry Kudlow has been on the job for four days. He's out there trying to sell these $50 million. And now, tonight, boom, let's throw $100 billion more.

REICH: Steve Moore, can I just say something? I mean, there's smart -- there are smart ways of negotiating, and there are stupid ways of negotiating. You don't want to put yourself in the position of having to basically lose your credibility if you have to back down. You never want to be in this position.

MOORE: But he's not going to. That's the thing, Bob. He's not going to back down here. I really don't think he will.

REICH: He already is in that position.

BURNETT: So you think, Steve, we're getting $150 million in tariffs, not backing down?

MOORE: Look, we have an example of a success of Trump's trade policy with respect to the threat of terrorists, what happened in South Korea. We want that outcome.

And, Robert Reich, I think you would want that outcome, too. I mean the outcome here is that China behaves itself.

(CROSSTALK)

REICH: The markets are not being stupid, Steve.

BURNETT: All right. Well, we shall see what happens. This is just the beginning obviously. The salvo. We'll see what happens with actual markets. Thank you both.

And next when presidents meet the fashion police. Jeanne Moos has the story.

(COMMERCIAL BREAK)

[19:57:51] BURNETT: Tonight, what's going on with President Trump's pants?

Here's Jeanne Moos.

(BEGIN VIDEOTAPE)

TRUMP: It's taken about two minutes, but --

JEANNE MOOS, CNN CORRESPONDENT: He's got a big personality, big hair, and now he's got big pants?

"Vanity Fair" asked the pressing question, what is going on with Trump's pant legs.

On a couple of recent occasions, the president has been photographed with what the magazine calls enormous pant legs, the circumference of a healthy toddler's head.

Is something changing?

DR. RONNY JACKSON, WHITE HOUSE PHYSICIAN: Height is 75 inches, weight, 239 pounds.

MOOS: Is the president gaining weight or losing height or just in need of a tailor?

In Trump's "Think Like a Billionaire", he wrote, I wear Brioni suits which I buy off the rack.

Remember the last flap over presidential pants?

JIMMY FALLON, COMEDIAN: He wore this in a pitcher's mound --

MICHELLE OBAMA, FORMER FIRST LADY: The mom jeans?

FALLON: Yes, oh, no, sorry.

OBAMA: Jeans. FALLON: But if you're not a mom, then you're the --

OBAMA: Dad jeans.

MOOS: Dad jeans, mom jeans, whatever you call them, they're not President Trump's problem.

JACKSON: He has incredibly good genes, and it's just the way god made him.

MOOS: But there's one guy with a leg up on President Trump. Forget nuclear button size. Look at these babies.

One Twitter user launched the dear leader with the caption, final inflation test for the new Kim Jong balloon. His massive pant legs have inspired a British journalist to create #kimjonguntrouserwatch.

Another commenter likened his limbs to a pair of those inflatable wind dancers. Forget the arms race, we're talking a legs race, one President Trump would probably rather lose. At least when the "PolitiFact" pants on fire meter lights up over the president's latest untruth -- he'll have more pants to burn.

And if it's money you want to burn, these jogging pants will set you back 50 bucks.

Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

BURNETT: Oh, thank you for joining us. Don't forget, you can watch OUTFRONT anytime, anywhere. Just go to CNNgo.

Anderson starts now.