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THE LEAD WITH JAKE TAPPER

Trump Administration Imposes More Sanctions on Russia; Wall Street Drops on Trade Fears. Aired 4-4:30p ET

Aired April 6, 2018 - 16:00   ET

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


[16:00:06]

ANNOUNCER: This is CNN breaking news.

JAKE TAPPER, CNN HOST: Welcome to THE LEAD. I'm Jake Tapper.

We are going to start with some breaking news in the money lead. The Dow tanking, ending this Friday afternoon down more than 570 points. At one point today, it was down more than 700 points.

The steep tumble as President Trump threatening a trade war with China and after a weaker-than-expected jobs report out this morning.

Let's get right to Cristina Alesci at the New York Stock Exchange.

And, Cristina, these trade fears, frankly, they have lingered all week. Why such a dramatic drop today?

CRISTINA ALESCI, CNN CORRESPONDENT: It is pretty clear. President Trump basically ratcheted up a war of words with China overnight, announcing or floating the idea, rather, of $100 billion in tariffs on additional tariffs on -- addition tariffs on Chinese goods.

And, look, the market doesn't like this for three reasons. One, it doesn't like saber-rattling in general. It thinks there may be a cleaner way to get China to the negotiating table. Remember, China is our biggest trading partner, has lots of levers it could pull if it chooses to retaliate against us.

Two, there was a lot of confusion when administration officials came out today after President Trump's floating this idea. On the one hand, we had Trump's economic adviser, Larry Kudlow, out there trying reassure the market that this is part of a negotiation.

The next minute, Treasury Secretary Steve Mnuchin comes out and says there's a possibility of a trade war. The market is just trying to make sense of whether or not this is truly a negotiating ploy or if President Trump is ready to move on these tariffs.

And, third, any time you talk about tariffs, there is a possibility of increased costs to the consumer and to producers. So you're talking about possible price increases at a time when growth may pull back, because we're at near full employment at this point in the economy.

TAPPER: All right, Cristina Alesci on Wall Street for us, thank you so much.

Let's go now to CNN's Jeff Zeleny at the White House.

And, Jeff, Press Secretary Sarah Sanders said this afternoon that the administration doesn't want this back and forth with China to become a trade war. But, just last month, President Trump said trade wars are good and easy to win.

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: Jake, he did say that indeed last month. And, in fact ,he talked about that frequently.

We have also heard the president, since he's been in office, talk repeatedly about the rising stock market. Silence today from him as the stock market fell.

(BEGIN VIDEOTAPE)

ZELENY (voice-over): President Trump defending his trade threats today, acknowledging economic pain for some Americans, but offering no apologies for punishing China.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I'm not saying there won't be a little pain, but the market has gone up 40 percent, 42 percent. We might lose a little of it, but we are going to have a much stronger country when we're finished. And that's what I'm all about.

ZELENY: The president hoping to force China to change its trading practices, escalating his weeklong volley with Beijing by threatening new tariffs of $100 billion of Chinese imports, in addition to $50 billion proposed earlier this week.

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: The president is going to actually do something and be tough when no one else has been willing to do this.

ZELENY: Yet the threat against China is rattling investors, spooking the stock market and worrying American farmers, many of whom are Trump supporters.

Nebraska Senator Ben Sasse, one of the many farm state Republicans voicing concern, blasted the move, saying: "Hopefully, the president is just blowing off steam again. But if he's even half-serious, this is nuts."

White House economic adviser Larry Kudlow told reporters the proposed tariffs were simply a negotiating tool for now, but said any anger should be negotiated at China.

LARRY KUDLOW, DIRECTOR, NATIONAL ECONOMIC COUNCIL: And I'm amused when people ask, why is President Trump starting a trade war? Why is he putting up tariffs? Which, by the way, we haven't so far. How about this?

Why has China gone two decades without making the changes that the entire world and the governing organization knows they have been breaking? Why do they continue that? Blame China. Don't blame the administration.

ZELENY: The president caught many of his advisers off-guard by the latest round of tariffs, sparking fresh talk today of a trade war. While the White House said a trade war wasn't the objective...

HUCKABEE SANDERS: We don't want to it come to that.

ZELENY: ... Treasury Secretary Steven Mnuchin conceding it couldn't be entirely ruled out.

STEVEN MNUCHIN, U.S. TREASURY SECRETARY: While we're in the period before the tariffs go on, we will continue to have discussions. But there is the potential of a trade war. And let me just be clear. It's not a trade war. The president wants reciprocal trade.

(END VIDEOTAPE)

ZELENY: So, as the president's advisers were out talking about this, Jake, very notable the president was not.

Another day this week did not have an event on his public schedule, with the exception of that brief radio interview this morning. Now, the question here is, is this a threat or is this something the president would actually see through and carry out?

[16:05:03]

We talked to the economic adviser here, Larry Kudlow, earlier. And he was walking a fine line. He said, look, the president is serious about this, people should be angry at China, not the president.

He said he would follow through with it, but then says this is a process of negotiation. But, Jake, the stock market obviously saw it as something more than that and the White House clearly watching those screens here today -- Jake.

TAPPER: Jeff Zeleny at the White House for us, thanks so much.

Turning now to our other top story and the world lead, one of the biggest mysteries about Russian interference in the 2016 presidential election is, who done it? And today we're getting some of the answers to that question and more.

The names of Putin cronies and Russian oligarchs who tried to help propaganda get into your news feeds and your hearts and minds before you voted. The Trump administration handing down a whole new round of sanctions against alleged perpetrators of the election meddling.

Ones who come closer to Vladimir Putin himself than ever before, including friends, family, former bodyguards and ex-spies.

Today, as the names and faces emerge, we Gates tell you who they are and why and how they ended up on this black list. All part of the U.S. effort to counter Russia's "destabilizing activities" in the and U.S. across the globe.

In a statement today, President Trump said -- quote -- "We cannot allow those seeking to sow confusion, discord and rancor to be successful" -- unquote.

That is a statement delivered on paper and we should point out of course that is contradicted by the president's past personal remarks about Russian election interference, which he has significantly belittled and called an excuse by Democrats for their defeat.

We have the story covered from here in Washington all the way to the Russian capital of Moscow.

But let's begin with CNN senior diplomatic correspondent Michelle Kosinski.

First of all, Michelle, who exactly was sanctioned today?

MICHELLE KOSINSKI, CNN SENIOR DIPLOMATIC CORRESPONDENT: Hey, Jake. Right.

What really turns heads about this are these are people close to Putin. You have seven oligarchs. These are billionaires with strong political ties, many of them close to the president of Russia himself, 12 of their companies that they either own or control and 17 senior government officials.

So you have people like Putin's son-in-law, a guy who is considered to be Putin's bodyguard, who is the head of the Russian National Guard. The head of the state energy giant Gazprom. An intel officer who has been a longtime spy.

People who are titans of industry in the gas sector, in construction. And one name that stands out to many, who will say I have heard that name somewhere before, is Oleg Deripaska, who was linked to Trump's former campaign chairman Paul Manafort.

So this is significant. And critics today, though, will say, OK, this is stronger than what we have seen from the administration before. This is really targeting people who are close to Putin, people with a lot of remember. And remember a week ago people were calling for this administration to hit Russia where they would hurt, so the administration is now doing that.

But the question is, OK, why did it take so long? Any oligarch worth his salt, knowing that these sanctions could be coming for months now, would have tried to insulate himself from being affected by them. And is this really going to change Putin's behavior? Probably not, Jake.

TAPPER: Matthew Chance in Moscow, you recently tracked down the oligarch targeted today that Michelle just mentioned, Oleg Deripaska.

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes. That's right.

I tracked him down to Vietnam, where he was there on the sidelines of the APEC summit. He was part of Vladimir Putin's business delegation that he took with him.

It just shows how close Deripaska has been to the center of Russian power. And I tried to question him about his links with Paul Manafort, of course, former chairman of the Trump campaign, those allegations bandied around that Manafort owes him millions of dollars and then offered private briefings on the state of the Trump campaign as a way of alleviating that debt.

He was not happy about me asking those questions and basically refused to answer. The U.S. Treasury sanctions report paints a very unsavory picture of Oleg Deripaska indeed. It talks about how he's been accused of bribing government officials -- I'm reading from it here -- taking part in extortion, in racketeering, even ordering the murder of a businessman and somebody who is alleged to have links with Russian organized crime.

And so this is an individual who is obviously taken very seriously indeed. He is very close to Vladimir Putin and he's not someone to necessarily be trifled with -- Jake.

TAPPER: And, Evan Perez, our Justice Department reporter, might any of these oligarchs be relevant to the Mueller investigation?

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: I think the answer is yes, Jake.

And I think what you have to think about is the unifying characteristic would be anybody who is close to Putin and who may have served as a way to get money into the election system, perhaps as a conduit for that.

And there's three names that come up immediately, Oleg Deripaska, which Matthew was just talking about. He was in business with Paul Manafort and Rick Gates in Ukraine. In 2016, Manafort actually e- mailed through an intermediary to see if he could give Oleg Deripaska some kind of briefing on the election that has been reported.

[16:10:08]

Viktor Vekselberg is another name that has come up. He was in that famous picture in 2015. Michael Flynn was there with Vladimir Putin at a dinner in Moscow. He attended Trump's inauguration, "The Washington Post" has reported.

A cousin of his who operates one of his companies' subsidiaries donated money to the Trump inauguration. Again, this is something Mueller's investigators are going to be paying attention to. And, of course, Alexander Torshin, who has deep ties to the NRA, he's somebody who had offered to try to set up a meeting between the Russians and Trump.

And I think, look, all three of these characters are people who, if you're investigating whether or not the Russian influence operation used money to get to the Trump campaign, those names are key.

TAPPER: Admiral Kirby, let me ask you. Obviously there's this odd disconnect, because the Trump administration, the Treasury Department enforcing these very tough sanctions at the same time that President Trump does criticize Vladimir Putin, belittles election interference, belittles the Russia investigation itself.

And just this week, we heard for the first time that President Trump has actually told Vladimir Putin he wants to meet with him even possibly at the White House. How much might these sanctions impact that potential meeting?

JOHN KIRBY, CNN MILITARY AND DIPLOMATIC ANALYST: It could very well have a chilling effect on the meeting.

And I wouldn't be surprised if Putin doesn't want to have that meeting right now in his anger and retribution for this. I think we have to stand by for a Russian reaction to this.

But, look, the president just doesn't like talking about this because he feels like it questions the legitimacy of his election. But I don't think we should hold that too much against him in this case. He did put out a statement in his name saying this was about election interference.

And these are very, very strong sanctions that cut very close to Putin's bone. And I think the administration should be applauded for that.

TAPPER: Matthew Chance in Moscow, has Russia responded in any way to these sanctions?

CHANCE: Well, there has been a verbal response from a number of players. The Russian arms exporter said this is an attempt by the United States to cut it out of the global arms market.

One of senator who was sanctioned saying that this is unforgivable and is an attempt to break Russia which won't work. The Russian Foreign Ministry in the last minutes has issued a statement saying there will be a hard response.

But in terms of concrete measures, nothing has been enacted yet. But we have to be careful about what to expect. In the past, Russia has downsized the U.S. diplomatic mission in Russia. It has taken other steps and it's even done things that are asymmetrical. At one point, it banned the adoption of Russian children by American adoptive parents.

And it's a very uncertain time and we could see some kind of unpredictable response from the Russians.

TAPPER: Evan, I want to come back to the Manafort part of the Mueller investigation for a second, because obviously Oleg Deripaska, the oligarch who was sanctioned today, one of the many, is relevant to the Manafort part.

We learned some more information about Mueller investigating potential collusion with Manafort and Russians, even seeking information, Mueller seeking information from five AT&T phone numbers that Manafort once used.

PEREZ: Right.

This was a bit of a surprise in a court filing that came through last night from the Mueller investigators. They said as recently as March 9, they served a warrant to get information from five AT&T phone numbers related to Paul Manafort.

And what we learned from this court filing is that it appears they're contemplating additional charges against Paul Manafort. They said they're continuing to investigate him and they also said that there are additional investigations perhaps related to Manafort, people connected to him who are also being investigated.

And that's why they're serving these warrants. What this tells us is there is a lot more in this investigation that is being done by the Mueller team, despite the fact that we keep hearing from the White House that this thing is almost over.

It doesn't seem like it is. And certainly Manafort is at the center of all of this. And the tentacles that go out from him is what Mueller is pursuing at this point.

TAPPER: Michelle Kosinski, do we know, has the administration been specific in any way about what these individuals specifically are alleged to have done with the election interference?

KOSINSKI: No.

And it's not all about election interference for these sanctions. They made it very clear. These are senior administration officials talking to reporters this morning -- that this is about the range of Russia's negative activities.

These are billionaires who have tons of political influence. We already know of some ties to the United States. Some potential ties to, say, the campaign. So there is a lot of ifs there in terms of how the money flows.

But they're not getting too specific about in each case what these people could have done, whether this was, say, ties to Syria vs. election ties to election meddling.

TAPPER: All right. Good clarification.

Thanks, once and all. Appreciate it.

[16:15:00] Sara Sanders just said that, quote: Right now I have no personnel announcements. Right now.

Could the president's jet-flying, motorcade-riding, low-rent paying EPA chief possibly hang on any longer?

Stay with us. (COMMERCIAL BREAK)

TAPPER: The bottom line when it comes to President Trump and his beleaguered EPA administrator Scott Pruitt, according to sources close to the president, is that Pruitt might soon be fired or promoted. It's unclear, as with so many personnel stories with this White House.

Today, President Trump pushed back on a CNN report that he had floated the idea this week of making Pruitt attorney general, tweeting, quote, do you believe that the fake news media is pushing hard on a story that I am going to replace Attorney General Jeff Sessions with EPA chief Scott Pruitt who is doing a great job but is totally under siege.

[16:20:02] Do people really believe this stuff? So much of the media is dishonest and corrupt, unquote.

Around this time yesterday, the president called Pruitt a good man, but of course, he has a history of saying that phrase right before people are shown the exit door.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Michael Flynn, General Flynn is a wonderful man.

Reince Priebus, a good man. Thank you very much.

We'll see what happens with Mr. Bannon, but he's a good person.

Secretary Price is a good man.

Rex is a very good man. I like Rex a lot.

You're doing a great job. We appreciate you.

UNIDENTIFIED MALE: Thank you.

TRUMP: Thank you very much.

(END VIDEO CLIP)

TAPPER: Let's bring in CNN's Sara Ganim.

And, Sara, the president's ambivalence about Pruitt maybe what's reflected in all of these mixed messages to people around him. What did White House Press Secretary Sara Sanders have to say about Pruitt's future today?

SARA GANIM, CNN CORRESPONDENT: Well, I'll give you one guess. She called him a good man. She said the president gave him a vote of confidence, thinks he's doing a good job.

But his agency which is charged with keeping the nation's air and water clean itself has become toxic inside, and that has put administrator Scott Pruitt on the hot seat. (BEGIN VIDEOTAPE)

GANIM (voice-over): As scathing headlines about EPA Administrator Scott Pruitt pile up, a rift is deepening inside the agency. Sources tell CNN that multiple senior officials, many of them fellow Republicans, who pushed back against Pruitt's management and lavish spending have been demoted, reassigned or iced out for raising flags.

One was the lead agent on Pruitt's security detail who was reassigned when sources say he refused to drive Pruitt through town with lights and sirens to help him avoid Washington D.C. traffic and get to meetings and the airport on time.

Another was a top Trump aide.

TRUMP: This guy is a champ. He's tough as hell. Whenever there's a problem, he's not supposed -- he runs right in like full blast, runs it. He is a wild man.

GANIM: That man, Kevin Chmielewski, is former Trump campaign staffer who served as Pruitt's deputy chief of staff for operations, but was stripped of his duties. The exact reasons are unknown.

But there were many extravagances that rub some staffers the wrong way, including a proposed $100,000 a month membership to a private jet company, two proposed desks with a $70,000 price tag, including one that was bulletproof. Frequent and expensive trips to his home in Oklahoma and several international trips that cost taxpayers thousands of dollars and included a lot of leisure time.

Two sources tell "The Washington Post" that Pruitt endorsed the idea last month of giving big raises to two staffers, but Pruitt wouldn't say who was to blame for the raise in a Wednesday interview.

SCOTT PRUITT, EPA ADMINISTRATOR: It maybe -- there would be some accountability.

REPORTER: A career person or political person?

PRUITT: I don't know.

REPORTER: You don't know. You run the agency. You don't know who did it?

PRUITT: I found out about this yesterday, and I corrected the action. So, we are in the process of finding out how it took place and correcting it.

REPORTER: All of this has some White House officials losing confidence in Pruitt, including Chief of Staff John Kelly, who has advocated for his firing.

But Pruitt has also been a good soldier, carrying out Trump's agenda to roll back hundreds of Obama era environmental regulations, earning him friends in industry on Capitol Hill and with one very important supporter, the president who met with Pruitt at the White House today. DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I think that Scott has

done a fantastic job. I think he's a fantastic person.

(END VIDEOTAPE)

GANIM: Now to add to all of this, just moments ago, "Politico" reported that the lobbyists landlord of the apartment were Pruitt stayed for $50 a night, this is the arrangement that really heated up all the talk about his questionable ethics this week, that landlord is now saying that Pruitt long overstayed his welcome there and they were forced to change the locks to get him out.

Of course, I don't have to tell you this, Jake. You know this. What the president sometimes says one day, he often changes his mind about a person the next, and that is reflected among the staffers that we've talked to throughout the day -- that sort of unease within the EPA.

TAPPER: Sara Ganim, thanks so much.

So how many scandals can this White House take before Scott Pruitt is shown the door? The president's deputy press secretary will join us next. Stay with us.

(COMMERCIAL BREAK)

[16:28:30] TAPPER: And we're back with our politics lead.

And I'm joined down by Hogan Gidley. He's the White House deputy press secretary.

Hogan, always good to see you. Thanks so much for joining us.

I want to ask you about EPA Administrator Scott Pruitt whom the president today in a tweet called totally under siege. That's hard to argue with. It seems to be because of his own actions, the most recent we've learned of include -- he rented a room for $50 a night, well below market rate from an energy lobbyist, an agent on his protection team was demoted apparently when he refused to drive with lights and sirens blaring just to get through D.C. traffic.

Multiple senior officials at the EPA were reportedly sidelined or demoted after they pushed back on this alleged spending issue.

President Trump promised to drain the swamp. Doesn't this all sound kind of swampy?

HOGAN GIDLEY, WHITE HOUSE DEPUTY PRESS SECRETARY: Look, we are aware obviously the allegations and you just outlined several of those allegations. But we expect that the questions raised by those stories, we expect that the EPA administrator be able to answer those.

Right now, we're reviewing it. We're trying to get to the bottom of everything, and when that process is done, we'll let you know.

TAPPER: CNN reported yesterday that the chief of staff, retired Marine General John Kelly, wanted Pruitt to go before there were any more negative headlines. And after that was reported, there were three more negative stories that came out about Mr. Pruitt.

Will he have a job by midnight tonight?

GIDLEY: Look, the president is the one who makes those decisions. I saw that story. I obviously can't confirm that. I wasn't in that meeting or any of those calls with the administrator.

But I can say we all serve at the pleasure of the president and as you guys know and America knows, if the president is displeased, you'll know it. You'll know it in a hurry.

TAPPER: There's obviously a big source of individuals who like Scott Pruitt a lot, not necessarily because of these issues but because of what he is doing in terms of deregulation.