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White House Tried to Turn Vulgar Remark on McCain into "Leaks" Scandal; Paparazzi Controversy Erupts 5 Days Before Royal Wedding; Dozens Killed in Protests over U.S. Embassy Move to Jerusalem; U.S. Supreme Court Strikes Down Federal Law Banning Sports Betting. Aired 1:30-2p ET

Aired May 14, 2018 - 13:30   ET

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


[13:30:00] RACHAEL BADE, CNN POLITICAL ANALYST: And could potentially destroy his being the next CIA director. Gina Haspel, McCain has come out against her. It's going to be a razor thin vote, so his opposition could sway people and make it a closer.

JOHN KIRBY, CNN MILITARY & DIPLOMATIC ANALYST: I did not think it was possible for this particular president to be more small, but he has proven me wrong. This is about as small as you can be as president of the United States, not even acknowledging the pain you caused this family and just acknowledging a mistake that was made.

WOLF BLITZER, CNN HOST: John McCain clearly an American hero, as we all know.

The tweet yesterday, Rachael, let me read it, because it involved helping a Chinese firm get more jobs. This is what the president tweeted: "President Xi of China and I are working together to get massive Chinese phone company, ZTE, a way to get back into business fast. Too many jobs in China lost. Commerce Department has been instructed to get it done".

BADE: Wow.

BLITZER: When I saw that, I knew he was always complaining about the trade imbalance with China, wants to create jobs in America, but I hadn't heard him, at least until now, say we have to help create jobs in China.

BADE: Total shocker, I think, including from some people in the White House who were not expecting this. The president always talks about America First, not China first. This is a massive Chinese company. I think it employs something like 25,000 employees, and it's basically frozen a lot of its operations because of the tariffs the United States is now putting on China. President Trump, two of his key issues are now coming to a head. He wants to hold China accountable on trade and reduce the trade deficit with the country but, at the same time, he needs them in order to advance a potential peace negotiation with North Korea. So he is trying to appease them perhaps on that angle of things, and maybe that is why he is legging up on this other trade issue.

KAROUN DEMIRJIAN, CNN POLITICAL ANALYST: The tweet reads like a distilled version of the Chinese government's talking points of what they're looking for in these negotiations. To add a little more nuance to it, yes, if you take this major company out of the tech economy, the aftershocks would be felt globally. It wouldn't just be limited to China. There are American manufacturers who supply parts that go into the same products they make who would also be directly hurt. At the end of the day, this comes down to the question that clearly China is playing hardball at the negotiating table. If we want to have their help and we need their help, if they're not part of that bilateral meeting that happens, they have been helping the North Korea meeting along so they can avoid the denuclearization talks. Then the question of what they're going to do with their economy, which of the three evils will you maybe be OK with a negotiation. But the fact we've seen the president tweet about this means these are negotiations that would be over if he just handed over a bargaining chip before it's done.

BLITZER: And the U.S. national security community, they have deep concerns about this Chinese company, not only stealing U.S. technology but using it to spy, potentially.

KIRBY: And, oh, by the way, to provide this technology to Iran and North Korea. The hypocrisy here is astounding. He's got his new ambassador to Germany out there last week saying German companies that do business with Iran, we're going to slam you, and now we're going to go ahead and just forget the billion dollars of fines we have assigned to this company for selling that technology to both Iran and North Korea. It is a collision of Chinese trade and a North Korea thing, but it's also running right smack into the Iran deal and hypocrisy around that as well.

BADE: We've seen senators have asked each of the top intel chiefs to say whether they would ever want to use this technology because of national security concerns, and each one of them -- I don't think they actually said no, I think it was just a collective silence, but that suspicion -

(CROSSTALK)

KIRBY: Including the Defense Department.

BADE: Yes.

BLITZER: Senator Cotton had them all in front of him and said, raise your hand if you would use any products from this company or you would recommend Americans use these products, and none of them raised their hands.

Everyone, stick around.

Much more we're following. With only five days before Prince Harry and Meghan Markle walk down the aisle, new drama surrounding the bride's family. We have details.

[13:33:57] And a huge decision from the U.S. Supreme Court. The justices striking down a federal law that bans sports betting. Hear how this impacts the entire industry. That's ahead. (COMMERCIAL BREAK)

BLITZER: Five days left before the royal wedding of Prince Harry and Meghan Markle. Right now, the spotlight is on a new saga unfolding on Markle's family. This time, it involves her father and half-sister.

Our royal correspondent, Max Foster, is joining us from Windsor in England.

Max, the royal family is fiercely protective of its privacy, repeatedly asking the news media to leave Markle's family alone. So when reports surfaced that Meghan Markle's father actually staged some recent paparazzi pictures that were actually embarrassing. Tell us about that, the latest twist in this saga.

MAX FOSTER, CNN ROYAL CORRESPONDENT: It's rather remarkable. As you say, they've been asking that they respect the Markle's' privacy. At CNN, we have. The tabloids haven't really been doing that. But we have these extraordinary images. We can show them to you now. They show Thomas Markle apparently preparing to head over to the U.K. There he is reading a book about U.K. history. He's looking at a Web site about his daughter and Harry. He's also getting measured up for a suit. We also see him getting fit for the wedding.

When these pictures came out, some of my colleagues said to me, doesn't it feel a bit staged to you? I said, couldn't possibly be the case. Then a Sunday newspaper comes up with story to say Thomas Markle conspired with a U.S. paparazzi photographer and money was exchanged, tens of thousands of dollars. We didn't get confirmation from any of the sides, but then we heard from Meghan's half-sister, Samantha, who basically admitted it and said it was her fault, in fact.

(BEGIN VIDEO CLIP)

[13:40:13] SAMANTHA MARKLE, HALF-SISTER OF MEGHAN MARKEL: I have to say I am entirely the culprit. I said, the world has no idea you're getting in shape, you're doing healthy things. They don't photograph you buying vegetables and P.H. water. They photograph you in as unflattering ways as they can. So I said, really, you need to show the world you're getting in shape and doing healthy things. So I suggested it. There's a lot of scrutiny that it was money motivated. It was not.

(END VIDEO CLIP)

FOSTER: We should say, Wolf, Samantha is invited to the wedding. Her father obviously will be walking her down the aisle. Just a few days left. I think Meghan is pretty focused on the wedding and she's ignoring all of this, at least that's what I'm told.

BLITZER: Let's hope she is.

All right. Thanks very much, Max Foster, in England for us, getting ready for this wedding over the weekend. Other news we're following, the White House getting ready to hold its briefing any moment now as it refuses to acknowledge an aide's vulgar remark about Senator John McCain. We're going to see how they respond. We'll have live coverage of that briefing coming up.

Plus, dozens killed in protest over the U.S. embassy opening in Jerusalem. The Palestinians respond. We'll speak to the Palestinian representative here in Washington when we come back.

(COMMERCIAL BREAK)

[13:45:53] BLITZER: This just coming in to CNN. The actress, Margot Kidder, has died. She had been a staple on movies and television since breaking into the business as a 20-year-old in 1968. She's best known playing Lois Lane in all four of the Christopher Reeve "Superman" films.

(BEGIN VIDEO CLIP)

MARGOT KIDDER, ACTRESS: Do you have a girlfriend?

CHRISTOPHER REEVE, ACTOR: No, I don't. But if I did, you would be the first to know about it.

KIDDER: Um.

(END VIDEO CLIP)

BLITZER: Her family says she passed away quietly in her home in Montana. Margot kidder was 69 years old.

Other news we're following, dozens of Palestinians were killed today during protests in Gaza along the border with Israel. The demonstrations were aimed at the United States' opening a new embassy in Jerusalem, moving the new embassy from Tel Aviv to Jerusalem. The Palestinian ambassador to the United Nations says today's violence means there's no chance at peace.

Let's get perspective from the Palestinians right now. Joining us, Ambassador Husam Zomlot. He's the head of the Palestinian authorities' delegation to the United States.

Mr. Ambassador, thank you very much for joining us.

Give us immediate reaction, if you can, to what the latest developments are, the impact of the U.S. moving the embassy, and what it means for the Israeli-Palestinian peace process?

AMB. HUSAM ZOMLOT, DIRECTOR, PLO DELEGRATION TO THE UNITED STATES: Just the U.S. administration has gave up on the peace process and its role as a mediator international towards achieving the internationally endorsed two-state solution. And it also means the U.S. has gave in for the voices of extremism, for the voices we'll see a zero-sum game, the fanatics, politically speaking. It was telling today that the ones who opened the ceremony of moving the U.S. embassy are religious leaders of the Christian Zionists who interpret politics and legality and world map from a very contested, to say the least, religious implications. This is not only encouraging Israel to cross the line. It's very encouraging to Israel to cross the line towards Armageddon and the end-of-time prophecy.

(CROSSTALK)

BLITZER: Ambassador, are you at all, Mr. Ambassador, in touch with Trump administration officials? They keep saying they're about to release their peace plan, Israeli-Palestinian peace plan, and they still have hope for the two-state solution, Israel alongside a new state of Palestine. Have you had conversations with these American officials?

ZOMLOT: We don't know what they're talking about, really. We don't know. Peace is a very firm vision by the U.S. That vision has been drawn by all previous administrations, with the 1968 borders, establishing a sovereign state with each in the U.S. capital. The U.S. law is very clear. It was presented in 1991 by former administrator, James Baker. It is very clear. The U.S. intervention and vision is about Israel's occupation, implementing U.N. Security Council resolutions and respecting them in Jerusalem, never recognizing Israel's control of annexations. So what the U.S. administration has done is reneging on these promises and violating international law. There is a U.N. Security Council resolution that the U.S. voted for and that presents any state from moving its embassy from Tel Aviv to Jerusalem. And also the U.S. has stated that Jerusalem is outside the negotiating table. You know it, Wolf, very well. You have been there for many decades. But Jerusalem is the heart of the two states solution --

(CROSSTALK)

BLITZER: Let me just interrupt, Ambassador, because they say they're not necessarily concluding all final status of all parts of Jerusalem. Yes, the U.S. is moving the embassy to west Jerusalem, but they're not completely ruling out the possibility of the Palestinians having control of parts of east Jerusalem and having a U.S. embassy in east Jerusalem for the new Palestinian state. When you hear that from the administration, what do you think?

[13:50:08] ZOMLOT: No, I only have it from you now. Jerusalem is the capital of the Jewish people. It's not even the capital of Israel. As I said earlier, a clear religious interpretation of international relations and legal matters on one hand. On the other hand, there was a reason why all previous American presidents, from President Truman to President Obama, why they decided not to move the embassy. They knew, by doing so, you actually remove the U.S. from the role of the mediator and dictate the terms of reference and dictate the outcome of Jerusalem being an issue. Of course, we would be fine if the U.S. has -- when there are two embassies after reaching a peace agreement. Before that, it is -- it will only be seen as urgent on the Palestinians. President Trump himself says removing the Jerusalem from the table, taking it off the table. And then they wanted to remove the administration off the table that services the refugees. And then they are not even criticizing or condemning the illegal settlement expansion, which has been the major obstacle on the part of the two-state solution. And they are not even criticizing or condemning the murder by Israeli forces of the Palestinian peaceful demonstrators. So the bottom line, what peace process this administration is talking about? We believe that peace --

(CROSSTALK)

ZOMLOT: -- can be found now in the international community, in a multilateral forum. Peace can only be found based on legality, based on politics, not based on ideology, and some very twisted religious interpretations of reality.

BLITZER: Ambassador Zomlot, let's see what this -- if they do release a plan, the Trump administration, what specifically it spells out. We'll continue our conversations.

Ambassador Zomlot, thanks so much for joining us.

ZOMLOT: Thank you.

BLITZER: We're going to hear from the White House about these deadly protests in Gaza, along the border with Israel in a few minutes. I'm sure there will be plenty of questions on that, plenty of questions on a lot of other issues as well. The White House press briefing set to begin at the top of the hour. We'll have live coverage.

We'll be right back.

(COMMERCIAL BREAK)

[13:56:37] BLITZER: All bets are on. A U.S. Supreme Court ruling is clearing the way for states to legalize sports gambling. It's a major decision. The court struck down a 1992 federal law that prohibited most states from authorizing it. The decision sending major shockwaves through the sports world.

Joining us to discuss the legal ramifications, our Supreme Court analyst, Joan Biskupic, and sports journalist, Mike Wise.

You were in the courtroom. You were there in the Supreme Court when this unfolded. Walk us through what happened and what it means?

JOAN BISKUPIC, CNN SUPREME COURT ANALYST: OK. This was a long- awaited decision they had argued last fall. And the justices ruled in the voice of Samuel Alito, in the majority, this law is unconstitutional. It commandeered the States. It said the states could not regulate sports gambling, couldn't allow it. And what Justice Alito said, that was essentially the federal government trying to put itself in the shoes of state legislators.

What this means, Wolf, is that states like New Jersey can now allow this kind of sports betting and it means other states can, too. He was careful to say that if Congress wanted to outright ban it all, it could. In this case, the 1992 law you just referred to, it actually was dictating how states could regulate. As a result -- Mike will clue us in on what it's going to mean for this billion-dollar gaming industry. It also was significant in terms of the relationship between the

states and federal power. And it essentially said, the federal government has to back off in terms of these kinds of regulations.

BLITZER: It's a major decision, Mike, and especially for sports fan, for people who want to bet.

MIKE WISE, SPORTS JOURNALIST: It means we will never have to work again. We will legally bet on Washington games.

This is $100 billion industry offshore betting, the illegal wagering that's been happening. Many states fought to oppose this, because basically -- and the same with professional sports leagues, because the monitoring, the investigation, the education that was going to go into it were extra costs for them.

Also, the flip side of it is, the NBA, the Major League Baseball have been progressive in realizing this is going to happen. If they can partner with some of these fantasy sports leagues, they can bring back some of this revenue.

I think there's a split decision in the sports world right now. Some of the leagues are thinking they're going to cost them more money and take all of the gloves off. The others, the more progressive leagues, like the NBA and Major League Baseball, realize this is the reality. It's like alcohol prohibition ending. Some people are going to abuse this, some people are going to do it right and legally, and that's where it goes.

BLITZER: It's not just casinos. You can make phone calls now, and place bets all over the country.

BISKUPICS: Yes. What Justice Alito said, and the majority signed onto, these are big policy decisions that have to be made. How these things should be regulated and just the scope of them and lots of state activity, Justice Alito said this is something that is not for the court to decide. It can be a moral issue, and it's definitely not for the justices to enter that realm. It's for the individual states, unless Congress is going to outright ban.

WISE: And it won't affect the recreational gambler that has a bookie. They've been doing this for a long time. Now they can make their bad decisions legal.

BLITZER: A major decision of the U.S. Supreme Court.

Guys, thanks very, very much.

The White House press briefing set to begin any minute now.

Stay with us. Our live coverage continues.