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Sandusky's Oldest Accuser Comes Forward; Trump Blasts Unity Critics; Trump States He May Have To Change Tax Cut Plan; Trump Under Fire For Flexibility On Issues; Trump State The U.S. Can Print The Money And Never Default; North Carolina Sues Justice Department Over Bathroom Law; Justice Department Holding News Conference Today To Respond To North Carolina. Aired 1-1:30p ET

Aired May 9, 2016 - 13:00   ET

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


[13:00:23] WOLF BLITZER, CNN HOST: Hello, I'm Wolf Blitzer. It's 11:00 a.m. in Edmonton, Canada, 1:00 p.m. here in Washington, 1:30 a.m. Tuesday in Pyongyang, North Korea. Wherever you're watching from around the world, thanks very much for joining us.

Right now, we're waiting to hear from the governor of North Carolina. He's expected to speak momentarily in Raleigh about the transgender law there.

We're also keeping an eye on the controversy surrounding Republican presumptive presidential nominee, Donald Trump. He's come under lots of fire from establishment Republicans who say they simply won't be able to back him. And he's fired right back by saying he doesn't need a party that is unified.

And, today, Trump moved forward with his campaign and chose the New Jersey governor, Chris Christie, to lead his White House transition team should he win the general election in November.

On the Democrat side, Bernie Sanders was out on the campaign trail this morning in Atlantic City, New Jersey. Next hour, we'll hear directly from Hillary Clinton at a women and families' event in Stone Ridge, Virginia. Tomorrow, the two will face off in the West Virginia primary. Nebraskans are also voting tomorrow but that's in the Republican primary.

Donald Trump is drawing fire for changing stances on Republican issues like taxes and the minimum wage, among others. Over the weekend, he talked about the reality of getting his tax plan passed, admitting he may have to rethink tax cuts for the wealthy. Talking with our Chris Cuomo this morning, Trump tries to explain what that admission meant.

(BEGIN AUDIO CLIP)

DONALD TRUMP (R) PRESIDENTIAL CANDIDATE (via telephone): Everybody across the board, businesses, everybody is getting a tax cut, especially the middle class. And I said that I may have to increase it on the wealthy. I'm not going to allow it to be increased on the middle class. Now, if I increased it on the wealthy, that means they're still going

to be paying less than they pay now. I'm not talking about increasing from this point. I'm talking about increasing from my tax proposal.

(END AUDIO CLIP)

BLITZER: All right. Joining us now is our Senior White House Correspondent Jim Acosta. So, is this a problem for Trump? What are you hearing out there, Jim?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, they don't see it as a problem inside the Trump campaign.

And you heard Donald Trump, himself, Wolf, say that this is not a change in terms of raising rates on the wealthy. He's saying that he would, potentially, during the process of negotiating with members of Congress, perhaps raise taxes higher than where he sets the rates in his own personal tax plan.

So, he's indicating some flexibility, I think here. I think it is a pivot towards the general election, Wolf.

He's also talking about letting the states do what they want to do on the minimum wage. During the primary process during the debates, he was saying he was opposed to raising the minimum wage.

And then, he also made this comment, to Chris Cuomo this morning on "NEW DAY," saying, well, the U.S. doesn't have to worry about defaulting on its debt because it can just print more money, the government can just print more money.

So, he did say some things, during the course of these interviews over the last 24 hours, that have raised some eyebrows.

But, Wolf, I will tell you, from being out on the campaign trail, and you know this, Donald Trump supporters are very different from establishment Republican supporters. They are not by and large Christian conservatives. They are not country club Republicans, as you might call them.

They're more of the Wall Street, or excuse me, the Wal-Mart moms, you know, Harley Davidson dads, you know, folks who are in the middle to lower income brackets out there. Perhaps you might call them a Reagan Democrats back in the old days.

And so, this is not -- you know, this is not something that's going to work well with the establishment Republicans here in Washington. But Donald Trump voters are sometimes different from those voters -- Wolf.

BLITZER: All right, Jim Acosta watching Donald Trump for us. Thank you.

Let's dig a little bit deeper into Donald Trump's economic plans. Rana Foroohar, our CNN's Global Economics Analyst. She's the assistant managing editor at "Time" magazine. Rana, let me start with what Donald Trump said on the debt, the national debt. He told me last week he was the, quote, "king of debt." But listen to what he said earlier this morning.

(BEGIN AUDIO CLIP)

TRUMP (via telephone): If we can buy back government debt at a discount, in other words, if interest rates go up and we can buy bonds back at a discount, if we are liquid enough as a country, we should do that. In other words, we can buy back debt at a discount.

People said I want to go and buy debt and default on debt. I mean, these people are crazy. This is the United States government. First of all, you never have to default because you print the money. I hate to tell you, OK? So, there's never a default.

(END AUDIO CLIP)

BLITZER: All right. Does his explanation make sense? From your perspective, can the U.S. really buy its way out of the debt by printing money? Explain what's going on here.

[13:05:07] RANA FOROOHAR, CNN GLOBAL ECONOMICS ANALYST: Absolutely not. I mean, this is bringing junk bond logic to federal budgets.

Basically, the U.S. runs a constant deficit. That means we have to keep issuing debt in order to pay the debt we already have. If we were to endanger the credit rating of the U.S., our borrowing costs would go up and that would create this terrible snowball where, yes, you do have to keep printing more money. You get inflation. You get a growing debt bubble. It would be terrible. I mean, this is -- this is what countries like Zimbabwe do, you know, or the Weimar Republic back in the, you know, pre-World War II days of Germany. This is not a club that you want to be in, economically.

BLITZER: Let's talk about taxes for the rich right now. Trump now says he wants to bring down their tax rate but maybe not as much as his current proposal says. He's more focused on the lower the taxes for the middle class. Can you cut the tax rate for everyone right now? How would that impact the economy?

FOROOHAR: Well, you know, both the Tax Foundation and the Tax Policy Institute which study the plans of all the candidates have said that the plan that Donald Trump has out there right now, which is to cut across the board in all socioeconomic groups without actually proposing spending reductions, would increase the deficit by $10 trillion.

So, we're talking about a plan that would actually increase the deficit. I mean, the math is pretty simple. When you cut taxes, you also have to cut spending. But he's not proposing to do that right now. And it's very similar to, sort of, the Reagan years where you got tax cuts but you also, you know, got spending increases and that's why the deficit grew during that period.

BLITZER: Rana, I want you to stand by for a moment. There's another story that's breaking right now.

North Carolina's Republican governor, Pat McCrory, is holding a news conference right now to explain his administration's decision to sue the federal government in defense of the state's controversial so- called bathroom law that affects transgender people. I want to listen in briefly.

GOV. PAT MCCRORY (R), NORTH CAROLINA (live): -- a fine. Access to restrooms, locker rooms, or shower facilities be based upon one's gender identity or gender expression. A similar policy was rejected, just months earlier, by the voters of Houston, Texas, by 61 percent of the vote. This caused major privacy concerns about males entering female facilities or females entering male facilities.

Our state legislature believed this was an unnecessary government overreach into the private sector, imposing regulations and impacting one's personal privacy. The state legislature and this governor also believe that guidelines then need to be put in place because of this new public topic for government buildings, our schools and our rest stops to ensure privacy and expectation privacy for everyone.

Now, just five days ago, the U.S. Department of Justice sent letters to my office, the Department of Public Safety, which reports to this governor, and to the university system, suggesting that having government employees use the bathroom, locker room or shower facility that corresponds to their biological sex is in conflict with federal policy.

The Department of Justice asked all parties to set aside their constitutional duty and refuse to follow or enforce our state law. This was a substantial request with very serious implications. And the U.S. government gave us a mere three business days to respond to this letter.

We asked on Friday, the Department of Justice, for additional time. In fact, we asked for an additional two weeks. But they refused unless I made a statement where I would publicly agree with their interpretation of federal law. And if I did, they would give me one additional week to respond. I could not agree to that because I do not agree with their interpretation of federal law. That is why this morning, I have asked a federal court to clarify what the law actually is.

Now, I anticipate our own legislature, other private sector entities from throughout the United States, and possibly other states to join us in seeking this clarification. Because this is not just a North Carolina issue, this is now a national issue and an issue which imposes new law on every private sector employer throughout the United States of America with over 15 employees.

[13:10:10] We believe a court, rather than a federal agency, should tell our state, our nation and employers across the country what the law requires.

And let me say something. Our nation is one nation, especially when it comes to fighting discrimination which I support wholeheartedly. Ultimately, I think it's time for the U.S. Congress to bring clarity to our national anti-discrimination provisions under Title VII and Title IX.

Let me repeat that one more time to all of our U.S. representatives and the leaders of both the Republican and Democratic Parties in Congress. Ultimately, I think it's time for the U.S. Congress to bring clarity to our national anti-discrimination provisions under Title VII and Title IX.

Now, right now, the Obama administration is bypassing Congress by attempting to rewrite the law and set basic restroom policies, locker room policies and even shower policies for public and private employers across the country, not just North Carolina.

Now, I am still asking the North Carolina legislature to reinstate the ability to sue for wrongful termination for discrimination in state court. I encourage them to do this and do it quickly.

I also welcome additional dialogue with the City of Charlotte and our state legislature which has been ongoing for the past week. And I want to ensure the people of our state and our country that North Carolina has long held traditions of ensuring equality.

The majority of our citizens in our great state and this governor did not seek out this issue. However, the state of North Carolina and this governor welcome the opportunity to be part of the solution for all of the states and especially our nation, the greatest nation, the United States of America.

Thank you very much.

BLITZER: All right. So, there you heard him. The governor of North Carolina, Pat McCrory, explaining his effort to try to see some sort of clarification on this very controversial lawsuit against the federal government in a fight to defend the state's controversial bathroom bill. You just heard him making his case.

The law requires, by the way, transgender people to use the bathroom of the gender listed on their birth certificate. The U.S. Justice Department says it violates the Civil Rights Act. And they'll be holding their own news conference 3:30 p.m. Eastern later today. We'll be bringing you that live. The Justice Department will be reacting to what we just heard from the North Carolina governor.

CNN's Martin Savidge has been following this story for us. Martin, what explanation did the governor give for the lawsuit against the Department of Justice? Because in -- there clearly is a major fight underway between the Justice Department and the governor.

MARTIN SAVIDGE, CNN CORRESPONDENT: There is. And, in fact, it has to do with billions of dollars. That's really what the governor did not mention in all of this. Federal money that the federal government has been threatening to withhold if it did not -- meaning the state of North Carolina come into compliance with what they say are violations of the civil rights bill, based upon this bathroom bill that North Carolina has passed here. But the governor is arguing that, look, you know, transgender is not a protected class. And, thereby, their bill doesn't discriminate because there's just no such protection provided. And they're arguing that their bill, thereby, is legal. What they want is a judge to somehow clarify this.

In many minds, at least legal experts are saying, this is only going to potentially delay what eventually North Carolina will have to do. But North Carolina is trying to say, it isn't just us. It's the rest of the nation as well. We need some kind of national decision.

BLITZER: All right, we'll see what the courts decide, in terms of clarification.

Quickly, Martin, a new CNN-ORC poll shows the majority of Americans disagree with laws like the law of North Carolina. 57 percent say they oppose the legislation, 38 say -- 38 percent say they support it. What kind of state support does it have? What are you seeing?

SAVIDGE: Most of what you're seeing is inside of the legislature there. And clearly coming from the governor, the attorney general for the state of North Carolina disagrees with the governor here in this matter.

The thing is, you hear it being framed in very emotional terms, and I'm talking about the state's argument, where they're referencing about the possibility of men walking into women's bathrooms, into the locker rooms and into showers. What if this was your wife? What if this was your daughter? And so, using very emotional language to trigger some kind of support for this.

[13:15:02] BLITZER: Martin Savidge reporting for us. Thanks, Martin, very much. Once again, 3:30 p.m. Eastern, the Justice Department here in Washington will respond to what we just heard from the governor of North Carolina.

We'll take a quick break. When we come back, we'll get back to the race for the White House. There are new developments in this battle. New reaction coming in to Donald Trump. Much more coming up right after this.

(COMMERCIAL BREAK)

BLITZER: In politics, compromise can be a dirty word sometimes, but for Donald Trump it's not about compromise, it's about negotiation. Remember, he's the author of "The Art of the Deal." Here with me to discuss what's going on, David Gregory, he's our CNN political analyst and the host of "The David Gregory Show" podcast. Also joining us, our chief political correspondent, Dana Bash, and our CNN senior political reporter, Nia-Malika Henderson.

David, what is causing this rift within the Republican Party right now?

[13:20:00] DAVID GREGORY, CNN POLITICAL ANALYST: Well, there's two things. Donald Trump doesn't have fixed policy ideas yet. He is still a campaign that's working things out on the fly. And he is a negotiator. He said very clearly, his words, you have to be flexible. To a lot of voters out there, that's actually music to their ears. They want a politician who is flexible enough to negotiate to try to get things done.

The other piece of what he has to do is unify the party. He may be the presumptive nominee, but there are a lot of Republicans, establishment Republicans, tried and true conservatives who are not on board. Paul Ryan is among those. And he is issuing loyalty (INAUDIBLE), but he doesn't have everybody on board, and that takes work, particularly when you've been outside of the political arena as he's been.

BLITZER: And, Dana, you know, over the weekend, we heard Donald Trump out there on the campaign trail, he's really going after Bill Clinton and Hillary Clinton, the sexual transgressions. A lot of us remember covering that in the 1990s. And he spoke about that earlier this morning with our Chris Cuomo on "New Day," explaining why he's getting into that right now.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENTIAL CANDIDATE (via telephone): Retribution for what she said.

CHRIS CUOMO, ANCHOR, CNN'S "NEW DAY": Why waste time on that?

TRUMP: She is playing - she is playing the woman's card to the hilt. She is going - I mean, I watched over the weekend and everything was about women and Donald Trump raised his voice and, you know, it's all nonsense. And you know what, women understand it better than anybody. And watch how well I do with women when it counts, when the election comes, watch how well, because women want to see strong security, they want to see strong military, they want to see borders where people just can't come crossing - walking across the border like it's swiss cheese.

CUOMO: But then why don't you talk about those issues and get women onto your side -

TRUMP: I do. I do.

CUOMO: As opposed to talking about infidelity and enabling.

TRUMP: I do. You took one sentence out of a long, one hour speech. You took one sentence out (INAUDIBLE) -

CUOMO: Mr. Trump - Mr. Trump, it's not one sentence. You are grandstanding on it.

TRUMP: I spoke very little about that (INAUDIBLE) -

CUOMO: You were working the crowd about it.

TRUMP: Chris, I spoke very little about that compared to other things. You took - you took a small amount of the speech and you build it up like it's the biggest thing in the world, but it is a big thing. Hey, look, he was the worst abuser of women (INAUDIBLE) politician -

CUOMO: Yes, you just said I'm making too much of it. Now you say it's a big thing.

TRUMP: Excuse me, as a politician in the history of our country. He was impeached. He was impeached. And then he lied about it. He said nothing happened with Monica Lewinsky, and then he said, sorry, folks, it actually did happen. And the guy was impeached for lying.

CUOMO: All of that can be true. What does it have to do with Hillary?

TRUMP: I know but she can't bring - well, listen, she can't talk about me because nobody respects women more than Donald Trump. And I'm going to take - I will - I will be better for women by a - by a big factor than Hillary Clinton, who, frankly, I don't even think will be good to women.

(END VIDEO CLIP)

BLITZER: Dana, a recent CNN/ORC poll, nationally, Democrats, Republicans, independents, everyone, had Hillary Clinton, 61 percent of the female vote, while Donald Trump gets 35 percent. If he's going to be elected president of the United States, he has to dramatically improve those numbers.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: He does. And he clearly thinks that the way to do it is to appeal to women who are just not that into Hillary Clinton. Unclear if whether or not talking about her personal life and making her essentially responsible and culpable, at least have some culpability, for what her husband did, whether that's going to fly. But, remember, this is a guy who has said things that most people - many people thought were outrageous and that would never fly and they did. So, he's a master marketer. And - and this is something that, for whatever reason, he has seized upon.

I do think that - that when Chris pressed him on the idea of talking about the issues, about the fact that, you know, what he would do for women or he has done, he says, for women in his own company, what he would do for them policy-wise, is the way that we should all go and try to go. But, look, it's not easy. We've all been there. We've all talked to him. And it's not easy when you have these kind of personal attacks coming from his mouth that you have to try to, on the fly, correct or at least push him back on.

BLITZER: As you know, the stage is now set for the big meeting Thursday here in Washington, Donald Trump, Paul Ryan, the House speaker. Yesterday, Sarah Palin told Jake Tapper she's going to do whatever he can to get Paul Ryan defeated in his Republican primary in August. What's the anticipation looking ahead to the meeting on Thursday? Are they going to resolve matters or will they go separate ways?

NIA-MALIKA HENDERSON, CNN SENIOR POLITICAL REPORTER: You know, it's funny because in some ways Donald Trump already said, listen, this was an idea that we meet and then go our separate ways. You know, I'm sure the hope for the party in terms of party unity is that they come out of here at least with, you know, sort of kind things to say about each other and this feud doesn't continue. But, you know, this is a negotiation. We talked about Donald Trump, sort of his opening bids. Paul Ryan sort of in opening bid saying, listen, Donald Trump, you have to convince me of, I should be in a supportive role.

Of course he would typically have a supportive role at the convention. Sort of the chairman of the convention. Someone asked him whether or not he would continue in that role. Donald Trump has suggested that maybe he would ask Paul Ryan to step down and Paul Ryan apparently said he would do whatever Donald Trump wanted him to do. So this is going to be something that's ongoing. We'll have to wait until Thursday. It's very anticipating -

[13:25:10] BLITZER: And, as you know, today Chris Christie, the New Jersey governor, was named by Donald Trump to head his transition team. If he's elected president of the United States, he will help make sure there's a cabinet, a top level officials who are brought in.

GREGORY: Yes, interesting that the statement from the Trump campaign says, when they take over the White House, which was interesting language. Chris Christie's going to have a role. I mean he's one of the few of the establishment Republicans who have actually fallen in line and is a supporter.

And with regard to Paul Ryan, I think both are trying to ratchet back a little bit. They want to meet. They want to negotiate. I think Trump understands that he wants and needs a Paul Ryan as a Washington insider to help with any agenda that he has. And Trump has to want to unify the party. He wants to win here. And, yes, his voters have to be respected, but he's got to get the rest of the party to actually be willing to go work for him. And there are plenty within the party, including conservatives, who are actively thinking about some kind of split.

BASH: I totally agree with you, David. And the fact that Trump didn't sign on to Sarah Palin's call to run a Republican primary candidate - or back the Republican primary candidate against Paul Ryan in his home district of Wisconsin says a lot. I think, you know, in - if this was a couple months ago or even a month ago, he probably would have said, you know, been all for it but he realizes it's a different stage. I feel like the history of Donald Trump, in these rifts that happen publicly, is once he has the private meeting, things change.

GREGORY: Right.

HENDERSON: Yes.

BASH: And the tone and tenor changes. So -

BLITZER: And I thought it was interesting, in announcing Chris Christie was going to be in charge of the transition team, and said Chris Christie's an extremely knowledgeable and loyal person.

GREGORY: Yes.

BLITZER: That keyword, "loyal," - BASH: Right.

BLITZER: That's what Donald Trump very much appreciates if someone is loyal to him. It's paid back, if you will.

All right, thanks very much.

A reminder, we're going to have a lot of coverage of the Nebraska and West Virginia primaries all day tomorrow right here on CNN.

Coming up, we're waiting for the Democratic presidential candidate, Hillary Clinton, to meet with women in Virginia to talk about work/life balance. Are these the type of voters that prefer Hillary Clinton over Donald Trump?

(COMMERCIAL BREAK)