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Interview With California Congressman John Garamendi; Hawaii False Alarm Fallout; Is President Trump a Racist?; WSJ: U.S. Intelligence Warned Jared Kushner About Ex-Wife of Rupert Murdoch. Aired 6-7p ET

Aired January 15, 2018 - 18:00   ET



WOLF BLITZER, CNN ANCHOR: Willing to talk. Steve Bannon's highly anticipated testimony in the Russia probe is expected tomorrow. What do House investigators hope to learn from the president's fired chief strategist?

And duck and cover. New concerns tonight about the U.S. response to a nuclear attack after a false alarm in Hawaii unleashed 38 minutes of sheer terror. If it had been a real nuclear strike by North Korea, would the Trump administration have been ready?

We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

ANNOUNCER: This is CNN breaking news.

BLITZER: Breaking tonight, on a day dedicated to celebrating the dream of racial harmony, the president is on the attack against the Democrat who publicly confirmed that Mr. Trump used vulgar language to insult African immigrants.

Before leaving Florida for Washington, Mr. Trump posted a tweet accusing the Senate minority leader of misrepresenting his remarks. Senator Dick Durbin, the number two Democrat in the Senate, is standing by his statement and he's challenging the vague and confusing denials by Mr. Trump and two Republican senators' denials contradict by multiple sources.

There's no denying that this controversy has helped derail efforts to protect young immigrants who came to the United States under the program known as DACA. In his tweet tonight, Mr. Trump is blaming Senator Durbin and Democrats, even though the president personally shot down a proposed bipartisan deal.

It is all adding more uncertainty to the latest efforts to avoid a government shutdown with the deadline just four days away.

We're also following the fallout after a false nuclear missile alert that caused mass panic and chaos as Hawaiians feared they were under attack. Tonight, the state has suspended its nuclear warning siren system and the employee who triggered the false alarm has been reassigned. This hour, I will talk about those stories and more with Congressman

John Garamendi. He is a Democrat on the Armed Services Committee. And our correspondents and specialists, they are also standing by.

First, let's go to senior White House correspondent, Pamela Brown.

Pamela, tonight, the president is trying to blame Democrats for the firestorm that forced him to declare he is not a racist.


The president expected to land back here in Washington within the hour, and after a few days of golfing, he is back to tweeting, this time singling out Democratic Senator Dick Durbin, saying in this tweet late today that he -- quote -- "totally misrepresented what happened in the DACA meeting and that deals can't be made if there is no trust."

But while the president continues to go after Democrats on DACA, the threat of a government shutdown is becoming more of a reality with each passing day, as Democrats are now threatening to withhold their vote.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I'm not a racist. I am the least racist person you have ever interviewed. That, I can tell you.

BROWN (voice-over): Tonight, President Trump is responding to charges he's a racist amid the fallout over his disparaging comments about African nations and Haiti. Two Republican senators who attended the Oval Office last week, Tom Cotton and David Perdue, say they didn't hear the president use the word S-hole.

SEN. TOM COTTON (R), ARKANSAS: I didn't hear it. And I was sitting no further away from Donald Trump than Dick Durbin was.

SEN. DAVID PERDUE (R), GEORGIA: I'm telling you he did not use that word.

BROWN: But Illinois Senator Dick Durbin says he did.

SEN. RICHARD DURBIN (D-IL), MINORITY WHIP: I know what happened. I stand behind every word that I said in terms of that meeting.

BROWN: Senator Lindsey Graham, who also was in the Oval Office meeting, confirmed to a fellow senator Trump used the term and told "The Post and Courier" in South Carolina today -- quote -- "My memory hasn't evolved," Graham said. "I know what was said. And I know what I said."

But a senior GOP source familiar with the matter says instead of hearing the president say that word, some Republicans actually heard the word s-house.

DURBIN: I don't know that changing the word from hole to house changes the impact which this has.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: The discourse right now is pretty low, is pretty embarrassing when you have to take your children out of the room just to report the news.

BROWN: The controversial comments have cast a shadow over a potential deal DACA. Lawmakers on both sides of the aisle have said they want a bipartisan DACA fix before Friday's government funding deadline.

SEN. CHRIS COONS (D), DELAWARE: It is going to get even harder now for us to come together and reach any sort of agreement on DACA. We have got a federal government that shuts down this coming week, this Friday, if we can't come to an agreement. And it is just getting harder when we have a president who, rather than tamping down or distances disagreements, fans them and inflames them.

BROWN: Senator Graham said lawmakers need to do more to work together.

GRAHAM: Mr. President, close the deal; 80 percent of Americans want to give the DACA kids a better life, and 80 percent of Americans want to secure our border and change a broken immigration system. It is going to take you, Mr. President, working with Republicans and Democrats to get this done. It is not going to be done on Twitter by tweeting. It is going to be done by talking and understanding.


BROWN: The president is trying to blame Democrats for standing in the way of a deal.

TRUMP: I don't think the Democrats want to make a deal. I think they talk about DACA, but they don't want to help the DACA people. I think they have a lot of sticking points, but they're all Democrat sticking points because we are ready, willing and able to make a deal, but they don't want to.

BROWN: Even as House Speaker Paul Ryan says there won't be a government shutdown, some Democrats are insisting they will oppose a government funding vote if there's no deal on DACA.

REP. JOHN LEWIS (D), GEORGIA: Well, I for one will not vote for government funding until we get a deal on DACA.


BROWN: So this war over immigration has really turned into a war over government funding and who would be to blame if the government shuts down by week's end.

I spoke to one White House official tonight who is already putting the blame on the Democrats if that does happen, saying that it would be unfathomable for the Democrats to withhold critical funding for national security over DACA, but, Wolf, when it comes down to it, that may be a tough sell considering Republicans control Congress.

BLITZER: Good point. All right, Pamela. Thanks very much, Pamela Brown, over at the White House.

Now to the Russia investigation, as a high-profile witness prepares to testify before Congress. That would be the president's ousted chief strategist, Steve Bannon, who suggested the 2016 Trump Tower meeting in New York with the Russians was treasonous.

Let's bring in our senior congressional correspondent, Manu Raju.

Manu, Bannon appears before the House Intelligence Committee tomorrow. What do lawmakers want to learn from him?

MANU RAJU, CNN SENIOR POLITICAL CORRESPONDENT: They want to know, Wolf, whether he knows about those contacts that occurred between Russian officials, Russian and Trump associates during the campaign, what he knows about that when he was the chief executive during the campaign, as well as anything that occurred during the transition and as a chief strategist to President Trump before he was ousted last year.

Now, as you alluded to in that new book that came out by Michael Wolff, Steve Bannon called that meeting that occurred with Donald Trump Jr., Russian associates and the like treasonous. He said it was unpatriotic. That meeting also attended by Paul Manafort and Jared Kushner.

And Bannon later said he was referring to Manafort, not Donald Trump Jr. But in that book, Wolf, he also says there was a zero percent chance that then-candidate Trump did not know about the meeting, did not meet with any of those Russians afterwards and did not discuss that with Donald Trump Jr.

And, as we know, Donald Trump Jr. testified under oath he did not inform his father about that meeting afterwards. Now, Bannon was not in the Trump campaign at that time, but so lawmakers are going to ask why did you make that assertion in Michael Wolff's book?

But he's not the only person, Wolf, who we should look for to testify this week. Another former campaign official, Corey Lewandowski, also expected to talk to the House Intelligence Committee largely about his contacts he had with the Trump foreign policy adviser George Papadopoulos, who we know pleaded guilty to the FBI after lying about his contacts with Russians during the campaign season, Wolf.

BLITZER: Interesting. The House Intelligence Committee moving forward with these interviews.

Paul Manafort, the former Trump campaign chairman, Rick Gates, who worked with him, they're back in court tomorrow as well. What are you learning about that hearing?

RAJU: Yes, this is going to be a pretty significant hearing. We're going to learn a lot about the direction that the special counsel's team wants to take this case, as well as what the defense -- how the defense is prepared to push back.

We know that the special counsel wants to have a trial date set by the middle of May. The question is whether or not the judge in that case agrees to it, Wolf. Already, thousands of pages of evidence have been turned over as part of the discovery process, and the special counsel has said roughly that 2,200 pages of that are relevant to this case.

So this could shine some new light into the direction of this that the special counsel is going to be move as they move towards the trial date as early as spring, Wolf.

BLITZER: Yes, they're moving quickly on that. All right, Manu, thanks very much, Manu Raju reporting for us.

Joining us now here in THE SITUATION ROOM, Congressman John Garamendi. He is a Democrat on the Armed Services Committee.

Congressman, thanks very much for coming in.

I will get to the Russia probe in a few moments. Let's discuss the president. He insists he is not a racist. What is your reaction?

REP. JOHN GARAMENDI (D), CALIFORNIA: Just have to look at the past.

Look way back, when he was running apartments in New York City. He was charged with racial discrimination in the housing programs. And when he opened up his campaign, first thing right out of his mouth was to attack Mexicans. And then he attacked a Gold Star family and then he attacked a Mexican judge and then the NFL football players, over and over always attacking minorities.


You make your own judgment about this. My judgment is, he is clearly a racist.

BLITZER: Some of your colleagues, Democratic colleagues in the House want to introduce a resolution to formally censure the president for his most recent remarks. Would you support that?

GARAMENDI: Absolutely. It is outrageous. My wife and I were Peace Corps volunteers in Africa. And what he said about Africa and about Haiti is absolutely unconscionable. And he needs to be held accountable.


BLITZER: Do you think a resolution along those lines in the Republican-controlled House would pass?

GARAMENDI: Of course not. The Republicans are sitting there. They're enabling all of this. Not only the racial attitudes, but they're not calling him out on all of the other things that he has done that have been so outrageous.

BLITZER: Not all Republicans.

GARAMENDI: Well, just name a few. I can't go through very many.

BLITZER: Well, you just heard Lindsey Graham. He differs with the president. Jeff Flake, Republican from Arizona, he's pretty critical.

GARAMENDI: I stand corrected.

BLITZER: I just want to point out not all Republicans.

Some of your colleagues go one step further, and they say they're not going to show up when the president delivers his State of the Union address on January 30 before a joint session of the House and the Senate. Where do you stand on that?

GARAMENDI: I will attend. The Constitution tells that the president has to annually report to Congress. The history most recently is, it is done in person, and I think it is a constitutional issue. I will be there, but I will not be very happy about what this man has done in the recent year.

BLITZER: I'm curious where you stand on DACA right now, the dreamers. The president, he's blaming the Democrats for a collapse of these bipartisan negotiations that he wants resolved. How far are you willing to go?

Will you vote against a spending bill by the end of this week if it doesn't include a deal allowing 700,000 or 800,000 dreamers to remain in the United States?

GARAMENDI: My attitude right now is the DACA kids have to be taken care of; 800,000 people have to be taken care of. We cannot use them as a ball to bat...

BLITZER: Are you willing to shut down the government if they're not taken care of?

GARAMENDI: Let's take a look at that. There are 230-plus Republicans. They control the House, they control the Senate. They have the votes in the House of Representatives without any Democrats to pass a spending bill, a C.R. or any other spending bill. They can do it on their own.

In the Senate, it is a little different situation, but nonetheless in the House they could do it. They don't need to come to us. And, frankly, they haven't. They didn't come to us on the tax bill, they didn't come to us on the health care repeals. They're doing it on their own.

They can do this on their own if they have a mind to do it.

BLITZER: The president in a series of tweets and statements, he blames the Democrats if there's a collapse of a DACA compromise allowing these dreamers to stay in the United States.

He just tweeted this afternoon: "Senator Dicky Durbin" -- he calls him Dicky Durbin -- "totally misrepresented what was said at the DACA meeting. Deals can't get made when there is no trust. Durbin blew DACA and is hurting the military."

He says the Democrats don't want a strong border and they don't want a strong military.

GARAMENDI: This is a man that refuses to take responsibility for his own actions. You take a look at all the things he has done in the past. He is always blaming somebody else. When he does something, he immediately denies that even he did it, even though it is there on the record, film and tape.

There's no way. And he is on one side of the issue one day, he's on the other side of the issue the other day. You take a look at the FISA, you take a look at DACA, I'm for it, I'm against it. Where do you stand?

It is almost impossible to negotiate with this person because there's no consistent policy.

BLITZER: Let's get to what Manu Raju, our congressional correspondent, was just reporting on Steve Bannon. He is going to appear before the House Intelligence Committee. Corey Lewandowski, the former Trump campaign manager, will appear.

Steve Bannon, as you know, was fired. Corey Lewandowski was fired. What could they bring, what kind of expertise or knowledge could they bring to this Russia probe investigation?

GARAMENDI: A whole lot.

But the real question is whether the Intelligence Committee is willing to stand up to this entire issue and gather the information that we desperately need to protect ourselves.

Bannon was very, very close to the president, not through the entire campaign, but certainly through the last half and then on into the presidency itself. Lewandowski, he was there at the meetings. Let's see what he has to say.

BLITZER: He was at Trump Tower.

GARAMENDI: Absolutely.

BLITZER: No, no, he was there earlier on when he was the campaign manager. Then he was fired. Bannon was brought in. But you say they have inside information? .


GARAMENDI: I'm sure they do. They were very close to this campaign. Get the information out there.

There's two things here. One is, how do we write laws to protect our democracy, to protect our election? Thus far, the committee in the House has done very, very little, if anything, along that score. The other is, do the investigation, find out what kind of collusion there was, what kind of laws were broken.

Fortunately, we have a special counsel. And that special counsel is, I think, going down a path that's going to be very, very important. We will see where it goes.

BLITZER: You think Robert Mueller, the special counsel, will actually sit down and interview the president of the United States?


GARAMENDI: He should.

There's something to be learned there, and he should do so.

BLITZER: Are you getting any indication that's going to happen any time soon?

GARAMENDI: Well, other than from his lawyers, who seem to be saying that it is not going to happen, and the president, of course, says there's no collusion, no collusions, says it about 10 times in a row, which gives me an indication he is worried.

BLITZER: Stand by. Congressman Garamendi, we have got more to discuss. We will take a quick break.

We will be right back.



BLITZER: We're back with Congressman John Garamendi.

We're following the breaking news on the president in attack and deny mode, as critics question whether he is a racist president of the United States.

Congressman, I want you to stand by.

Right now, let's get the latest on U.S. readiness for a nuclear attack after a panic-inducing false alarm in Hawaii. The state's nuclear warning sirens are turned off now and the employee who made the terrifying mistake has been reassigned.

Let's go to our Pentagon correspondent, Barbara Starr.

Barbara, the people in Hawaii feared a North Korean nuclear missile was heading right at them. What if it had been real?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, look, Wolf, for the U.S. troops defending the country, it really is all about being ready for whatever comes.

They like to say about fighting in Korea ready to fight tonight. Now U.S. commanders want to make sure that is absolutely true.


STARR (voice-over): A nighttime paratrooper jump by the 82nd Airborne Division over the skies of Nevada, practicing dropping into enemy territory.

At Fort Bragg, North Carolina, one of the largest-ever live fire exercises. Both are part of the Pentagon ensuring troops are ready if there is a war against North Korea. For now, President Trump suggesting it is not likely.

TRUMP: I think we're going to have a long period of peace. I hope we do.

STARR: But Defense Secretary James Mattis has made clear for months that being ready to fight just in case is job number one for the Pentagon.

JAMES MATTIS, U.S. SECRETARY OF DEFENSE: This is the reality that faces our Department of Defense and our like-minded allies, and we must have militaries fit for their purpose.

STARR: With a drawdown in Iraq and Syria, more troops at home can practice vital combat skills.

GEN. MARK MILLEY, U.S. ARMY CHIEF OF STAFF: Readiness for war, readiness for the intense combat of ground operations of any type, anywhere in the world, that is our task, and I can tell you that it has never been more important than it is today.

STARR: Hawaii's missile attack false alarm underscores the hair- trigger alert the military would be up against in a real war with Kim Jong-un. But President Trump recently has changed his tone on the crisis from bellicose...

TRUMP: North Korea best not make any more threats to the United States. They will be met with fire and fury like the world has never seen.

STARR: ... to optimistic.

TRUMP: We have certainly problems with North Korea, but a lot of good talks are going on right now. A lot of good energy.

STARR: The changing rhetoric has some worried the U.S. could lose leverage to force North Korea to give up its weapons and add to confusion in the region.

COL. CEDRIC LEIGHTON (RET.), CNN MILITARY ANALYST: This really complicates the mission of U.S. military commanders on the Korean Peninsula and in East Asia, because they have been -- for the last 60 years, they have been poised to conduct offensive operations against North Korea.


STARR: Might even get more confusing in the coming weeks. The Pentagon is about to release a report on its nuclear weapons, and it may call for the development of a new small nuclear weapon, low-yield, less explosive power, and many critics worry that could pave the way for any president of the United States to feel more comfortable about launching a nuclear attack -- Wolf.

BLITZER: Barbara Starr at the Pentagon, thanks very much.

Let's back to Congressman John Garamendi.

How high, Congressman -- and you are a member of the Armed Services Committee -- is the risk of miscalculation leading to war?

GARAMENDI: Extraordinary high.

There's always been, every year, often two or three times a year, some incident in the Korean Peninsula, somebody tries to escape or run away from North Korea, there's shootings, all of these things take place. A misunderstanding is extremely possible, and you can get a small situation blossoming into a huge military confrontation.

BLITZER: The president, by the way, walking down the stairs of Air Force One, he is just back at Joint Base Andrews outside Washington, D.C., from a few days down in Mar-a-Lago, his resort in Palm Beach, walking with his wife and youngest son down the stairs and then they will head to the White House.

This Hawaii disaster, and I say disaster, fortunately, it was a false alarm, but for 38 minutes, people were terrified.

GARAMENDI: Well, they certainly were. My daughter-in-law is from Hawaii. All of her friends were terrified. They were prepared to die. They thought there would be a nuclear bomb dropped on Honolulu.

And it was terrible mistake and the rest of the story is there was no follow-up for 30 minutes, even more. That system was broken and it wasn't -- hadn't yet been repaired. We need to be very, very careful.

BLITZER: Did you have any idea the system was broken over there in Hawaii? Hawaii. It could be in California, it could be in other states, too. I assume the Armed Services Committee, your committee, is going to be investigating trying to learn lessons to make sure it doesn't happen again.


GARAMENDI: But there are different roles here.

The Department of Homeland Security has the responsibility for civilian defense systems. Each state has its own systems. Hawaii obviously failed miserably in the operation of their system. I would hope that other states -- my state, California, is pretty good. We have all kinds of disasters that are occurring, most recently the mudslides.

So we have been operating in California with multiple disasters and many different kinds of alerts. Obviously, Hawaii wasn't up to snuff.

BLITZER: So what needs to be done now?

GARAMENDI: Well, what needs to be done is great -- a very robust communication system from the military to the state, the state offices of emergency services. Apparently, that wasn't even part of this thing. There was some mistake made within the Hawaiian emergency services department.

The military would normally be alerting the state. That didn't even happen. That wasn't even part of this thing.

BLITZER: So maybe there should just be a federal alert system for all of the states, as opposed to giving that authority to individual states, if you are talking about a nuclear ballistic missile endangering the United States.

GARAMENDI: Well, that is -- if that is the case, then if there is a launch of a ballistic missile anywhere in the world towards the United States, yes, the military would know about it. They would alert the states. That's already in play. But to turn over all of the emergency alert system to the states...

BLITZER: I'm only talking about nuclear a nuclear threat to a state. I assume the federal government would have better capabilities of anticipating that than Hawaii or California or New York or some other state.

GARAMENDI: The states wouldn't have any idea if there was an attack.

BLITZER: Of course not. Exactly.

GARAMENDI: It comes from the military down to the states. That needs to be exercised. Just as you saw the military exercising there, that system needs to be exercised. In fact, it is. But this was a unique -- hopefully a unique mistake that was made in Hawaii.

BLITZER: Hopefully, it was, and hopefully they will learn the lessons and not happen again. I can only imagine how terrified those people were.


GARAMENDI: They were.

BLITZER: This is -- yes.

OK, Congressman, thanks, as usual, for joining us.

GARAMENDI: My pleasure.

BLITZER: Just ahead, we are just getting in some breaking news on the Russia investigation and an interview with a member of the president's inner circle.

And the president goes to new lengths to push back against charges of racism. What do his words and his actions tell us on this Martin Luther King Jr. Day?


TRUMP: I'm not a racist. I am the least racist person you have ever interviewed.



BLITZER: Right now we're getting some breaking news on the Russia investigation. I want to bring back our senior congressional correspondent, Manu Raju. The breaking news involves the president's communications director, Hope Hicks.

[18:32:20] MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Yes, that's right. We're now hearing that she is going to talk to the House Intelligence Committee as part of the Russia investigation as soon as this week. Now, we were hearing that it could happen as soon as Friday.

Now, this is very significant, because Hope Hicks is one of the president's most trusted advisers. She's long been by his side during the campaign trail. She attended virtually every campaign rally. Now she's the communications director, one of his closest confidantes. And it's very rare that a sitting White House official would agree to sit down with the House Intelligence Committee. In fact, as far as we know, this will only be the second time that's happened, the other being Jared Kushner, the president's son-in-law.

But presumably she has a wide range of knowledge about Russia contacts that occurred during the campaign, or they want the see whether she has a wide range of knowledge, what she knows about any of these contacts that occurred between Russian officials, Trump associates as well as that -- the response to the Trump Tower meeting that occurred after it was revealed in "The New York Times" last year.

You'll recall that initial statement that came out was misleading. It did not explain the reason for Donald Trump Jr. taking these meetings with the Russians, but we now know that Hope Hicks was involved in crafting that response on Air Force One.

And Donald Trump Jr., we are told separately, when he testified before the House Intelligence Committee, said he had communicated with Hope Hicks as part of that response to those reports, not his father initially. So she's going to be asked about that, as well.

So a significant development, a very significant witness. We'll see what she eventually says, but we are expecting it to happen soon, as soon as this week. My sources telling me, Dana Bash and our colleague, Jeremy Herb.

BLITZER: Do we know if Hope Hicks has already testified or granted interviews to the special counsel, Robert Mueller?

RAJU: She did, in fact, speak with Robert Mueller last month. We're told it happened over two days. So clearly, Mueller's had some interest in learning about that, presumably also what she know -- knew about the firing of James Comey, any questions about obstruction of justice. We have not heard whether or not she's spoken to the Senate Intelligence Committee. This is the first tie we're getting a sense that she is speaking to someone on Capitol Hill.

BLITZER: She clearly knows a lot about that initial statement that was released following the Trump Tower meeting, the revelation of the Trump Tower meeting, that they put out a statement saying, well, it was about adoptions, of Americans being able to have adoptions of kids from Russia.

DAVID CHALIAN, CNN POLITICAL DIRECTOR: Of course, it wasn't about that.

BLITZER: It was really about getting dirt on Hillary Clinton.

CHALIAN: Which was clearly stated in an e-mail in the setting up of the meeting.

BLITZER: Yes. And she knows all about that.

CHALIAN: She certainly knows about the crafting of the response, which is, I would imagine, what they are most interested in talking to her about.

But as Manu points out, there -- I can't think of somebody, probably, who has spent more time around the president than Hope Hicks over the last nearly three years. And so there's a lot to ask her about, not just that response.

[18:35:04] But in terms of that response, there's very little -- when Donald Trump Jr. says, "Oh, I was communicating with Hope Hicks," there's very little that Hope Hicks is doing in crafting a statement that is not at the direction of the president. And I think that is going to be the key piece of information that investigators are going to want to unfold and look at, as sort of what were the actual directions, if any, from the president? And maybe Hope Hicks can give some light to that.

BLITZER: And it follows, Rebecca, the testimony, the appearances by Steve Bannon and Corey Lewandowski this week, her appearance later in the week before the House Intelligence Committee. It looks like the House Intelligence Committee is moving forward with a lot of -- a lot of special guests.

REBECCA BERG, CNN POLITICAL ANALYST: Right. And even after Donald Trump tweeted just a few days ago that he wanted Republicans on the Hill to be stronger, to wrest back control of these investigations, clearly, they are still taking these very seriously.

And the House Intelligence Committee, as you mentioned, Wolf, has been criticized by both parties for not being as bipartisan, as serious as the Senate Intelligence Committee investigation. So this is significant. It shows that they are still working on this, that they're not simply giving into these partisan urges and not giving in also to pressure from the president.

RAJU: You know, one thing, Wolf, I would be interested to see, too, is whether or not she invokes any sort of privilege or says...

BLITZER: Because she's still working in the White House.

RAJU: Exactly.

BLITZER: As opposed to a former official.

RAJU: That's right. Maybe not even assert executive privilege but say she's not going to discuss these private conversations with the president, because we have seen other officials say similar things, like Attorney General Jeff Sessions most notably. We'll see if she does the same.

BLITZER: So all of them will appear before the committee, but behind closed doors. Will they then subsequently release the transcripts of those sessions?

RAJU: We're not getting an indication of that. It's only happened on two occasions on the House side, for Carter Page and Erik Prince when they agreed. Initially going in, they cut a deal with the committee, said, "We'll only do it if you release a transcript."

We're not getting any indication that's going to happen here. So we're going to have to learn about that.

BLITZER: Does it look like the House Intelligence Committee is getting a little bit more bipartisan? Because as you know, Adam Schiff, among other Democrats on the committee, they were deeply worried.

CHALIAN: Well, let's not -- I don't think it's getting bipartisan. I think that would probably be going a bit too far. But the dire warnings of Adam Schiff that somehow the moment the calendar turned to 2018, that the Republicans were trying to just shut it down, and then proving not quite to be true. There are more interviews happening. We'll see how long this lasts.

We know, Manu better than anybody, the Republicans are eager to bring this to a close on the House side. They do see this as a wrapping up investigation, but clearly, even though Adam Schiff was quite concerned about it, you'll remember, in December, interviews continue.

BLITZER: Yes, they certainly are. They're going to be busy this week, as well.

Let's talk a little bit about the president saying, "I am not a racist." Pretty blunt to hear a president of the United States utter those words.

BERG: Right. And certainly, he was responding to a direct question, and so it's why he used that word. But not the sort of thing that the president wants to be talking about or Republicans want the president to be talking about at this critical juncture in the DACA debate, in the immigration reform debate, and as they have this spending deadline looming.

And Manu knows this better than anyone, that this is a very fragile negotiation they've been going through. They've been trying to strike a bipartisan deal in a hyper-partisan environment. The president is not making it any easier.

BLITZER: Deal or no deal, as far as keeping the government operating as of Friday midnight?

RAJU: I don't think we know that yet. The big question is going to be whether or not Democrats are going to agree for a short-term spending bill that does nothing on immigration.

What we expect is those immigration talks to happen, continue to happen. They occur through next month, before that March deadline where they have -- they presumably have to deal with the DACA issue.

The question is going to be Democrats are going to be OK with a two- or three-week short-term continuing resolution until mid-February to allow those immigration talks to take place. On the House side Democrats have said no. The Senate Democrats have been split on that.

And then what do people like the House Freedom Caucus do, those conservative on the House side who don't like these short-term spending bills? So it could be very difficult to get this through at the end of the week.

CHALIAN: And Wolf, it's important to remember they just went through this, right, in December where Democrats did, indeed, deal with sort of a kicking the can down the road, but the blowback that Democrats got from the base of the party about how important dealing with this DACA issue is was extreme in December.

And so in talking to Democrats, they aren't -- it is not at all yet clear that they are not going to sort of put a stake in the ground now and say, "This is the only leverage that we've got, and we are going to demand a DACA solution before we agree to fund the government," which, of course, then deals with the fallout, potentially, of the blame game and who would get blamed for that with a lot of Democrats...

BLITZER: But the Republicans, the majority in the House of Representatives, they could pass it on their own, right, without any Democrats?

RAJU: Presumably they could, but there are a lot of Republicans who do not like doing these short-term CRs and fundamentally vote against all of these. So at least on the Senate side, you're probably going to need some Democratic support to get this through. The House side, we'll see. If there's a revolt among the ride in the Republican conference, then you'll need Democratic support. And so far Democrats are not willing to do that without any -- any assurances that they can get a deal on DACA.

[18:40:14] BLITZER: Is that what you're hearing, as well, Rebecca?

BERG: Well, absolutely, Wolf. And you could see the political upside, potentially, for Democrats to try to block this and send the government into a shutdown, because they would be able to make the case that the president didn't want to work with them and that they would stop nothing short of protecting DACA recipients in the United States. I mean, for Democrats, that could be a very potent political message, especially going into 2018.

CHALIAN: Well, but for all Democrats? Is it a potent message for Joe Manchin in West Virginia? Is it a potent message for Heidi Heitkamp in North Dakota? Is it a potent message for Claire McCaskill? Yes, for the base of their party in those states, but those are deep red states that Donald Trump won by double digits. And so this is the problem that they're grappling with this week. The politics of this is that there are some Democrats in the Senate who may not want to make that case and stand on that ground that they're shutting down the government over this issue, because they've got to win over some independents and Republicans in their states in order to get reelected.

RAJU: And that's put Chuck Schumer in a difficult position. Unlike Pelosi, who's probably going to take a hard line.


RAJU: He's got to really understand where those members are coming from before he does the same thing.

BLITZER: We're getting more reaction coming into THE SITUATION ROOM on the president's declaring he is not a racist. Much more on this when we come back.


[18:46:05] WOLF BLITZER, CNN HOST: We're back with breaking news.

"The Wall Street Journal" in a newly published story reporting that U.S. counterintelligence officials in early 2017 warned Jared Kushner, the president's son-in-law and senior adviser, that Wendi Deng Murdoch, the ex-wife of Rupert Murdoch, could be using her close friendship with Mr. Kushner and his wife Ivanka Trump to further the interest of the Chinese government.

You know, David Chalian, a pretty explosive story in the "Wall Street Journal." She was married to Rupert Murdoch in 1999, got divorced in 2013. She still uses the name Ms. Murdoch. And, apparently, she's got a very close relationship with Jared Kushner and his wife Ivanka Trump.

It is an explosive story potentially, although the "Wall Street Journal" and others are pointing out it is common, relatively common for counter intelligence officials to warn incoming senior officials of a new administration to be careful about interactions with individuals who may have ties with foreign sources.

DAVID CHALIAN, CNN POLITICAL DIRECTOR: In fact, that was the White House's response in this story, right. They weren't denying that it happened, which was really interesting to see that, clearly, Jared Kushner did get this information. They just said it was part of, you know, national security briefings for senior staff of the new administration and that counterintelligence officials do this routinely according to the report to warn people with, you know, warn new members of administration about people that they may associate with that have connections to foreign governments.

We should make clear, nobody in this story is accused of any wrongdoing. I think that's an important thing to say. It's just simply beyond interesting that you would get a counterintelligence briefing where you're told that somebody you're friendly with may actually have designs on helping the Chinese government get represented in U.S. policy.

BLITZER: Manu, the representative for Jared Kushner and for Ivanka Trump described Mr. Kushner's interaction with officials in the "Wall Street Journal" article as warning him about Ms. Murdoch as routine senior staff security briefings. He added that Mr. Kushner has complied with all ethics and disclosure recommendations and has played a helpful role in strengthening the U.S./China relationship so as to help bring out a better resolutions to the many issues the countries have. That's the reaction from Jared Kushner and Ivanka Trump.

A spokesman for Ms. Murdoch said she has no knowledge of any FBI concerns or other intelligence agency concerns relating to her or her associations. The spokesman also added that she has absolutely no knowledge of any garden projects funded by the Chinese government. Ms. Murdoch's spokesman said she occasionally traveled to China with Rupert Murdoch but played down her role in any business dealings there.

MANU RAJU, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Yes. Clearly downplaying the significance of this. They don't want to make it sound like it is a whole lot, the White House is sensitive particularly to any perception Jared Kushner may have done, acted inappropriately. He has done a lot of scrutiny, of course, his role in the Russia investigation and the like.

To me, this also raises the questions about Jared Kushner's security clearance form. This has been a constant problem for him in the first year of his presidency after failing to disclose key foreign contacts through the course of the security clearance application. He was briefed on this as a matter of national security. Perhaps you don't need to be cleared in to get this kind of briefing if they're warning you not to do this, but it just raises questions again for Jared Kushner, something that continues to haunt him in this first year of the Trump White House.

BLITZER: Rebecca, how do you see it? Because it's very awkward.

REBECCA BERG, CNN POLITICS REPORTER: It is awkward, Wolf, but you also have to wonder if it was a major security concern for the United States, for intelligence agencies, why wouldn't they have raised it sooner with Jared and Ivanka Trump? Because they've been friends with Ms. Murdoch for many, many years. They hung out with her during the course of the campaign on a vacation in Croatia.

[18:50:01] So, if this was a threat during the campaign, you would imagine they probably would have raised this a lot sooner, but also -- I mean, this really does illustrate for us once again this tangled web of Trump associates, of potential conflicts of interest for them not only when you're talking about close friends but also business interest and people they have business ties with in other countries and around the world.

And so, just certainly something this administration uniquely has need to be aware of.

BLITZER: It's very interesting. And I'll just point it out. And, David, I want you to weigh in.

Rupert Murdoch is, of course, the executive chairman of the News Corporation, which publishes "The Wall Street Journal". "The Wall Street Journal" today just posted a little while ago, this story about Wendi Deng Murdoch, his ex-wife, a couple other stories include that interview that Donald Trump gave to "The Wall Street Journal" in which he made those comments, didn't make those comments about Kim Jong-un. A little discrepancy about what he said.

And there's other story that emerged the other day about a porn star supposedly collecting some sort of money indirectly from Donald Trump. I wonder who's going on because apparently they are very good friends, Rupert Murdoch and President Trump.

CHALIAN: Right. This is not the first time we have seen this sort of Trump/"Wall Street Journal" split. Usually, back in the campaign, the editorial page is not who is aligned with Donald Trump. We still see some divergence there like we do writ large with the Republican Party and the establishment wing and the Trump wing.

But you are right to note that in the last week, there have been three stories, the interview, the story with Stormy Daniels, the porn star who reportedly got hush payment and now this. "The Wall Street Journal" seems to be fully reporting out the things that they can on the Trump administration.

BLITZER: "The Wall Street Journal", pretty aggressive reporting now, you've got to admit.

RAJU: Yes, certainly. And it was interesting in that interview which the president disputes one word, I probably have good relationship with Kim Jong-un versus I would --


RAJU: I'd.

CHALIAN: Contraction, I'd.

BLITZER: All of us spent a lot of the weekend listening so closely to the audiotape released by both the White House and released by "The Wall Street Journal" to see, did we hear I or I'd?

RAJU: Yes. And it's interesting, because Trump seemed to be enjoying that interview when you look through that transcript, even proposing sitting down with those reporters at a monthly basis. Who knows if that's going to be case now after this series of stories?

BERG: Yes, he probably felt secure to an extent sitting down with "The Wall Street Journal" because they're previous interview with the president, their editor Gerard Baker, this friendly sort of setting for him. He might have been surprised by some of the coverage he's seen in "The Wall Street Journal", especially given that it's owned by his friend Rupert Murdoch.

CHALIAN: Perhaps, given the opportunity for an opportunity, it was a way to maybe try to mitigate some of the coming bad coverage out of the paper.

BERG: If that was the case, it didn't work.

CHALIAN: Exactly.

BLITZER: Let me play for you, David, reaction to the president's comments about Africans coming to the United States, Haitians coming. This is Mia Love, Republican congresswoman from Utah. Listen to this.


REP. MIA LOVE (R), UTAH: Well, I think that one of the things we need do is get people like me in the room. There are so many people that are -- that frankly, I want to just make sure that everyone knows that I don't know if those comments would have been made if I were actually in the room.

JAKE TAPPER, CNN HOST: Were the comments racist, do you think?

LOVE: Well, I think they were. Yes. I still think that he should apologize. I think that there are people that are looking for an apology. I think that would show real leadership.

BLITZER: She's the first Haitian American serving in the United States Congress. You don't believe the president is going to apologize. Do you?

CHALIAN: I don't. That wouldn't be sort of in accordance with anything we really see about him. And, in fact, look at what's happened. In the days since, he has tried to come up with a story about what he actually said and have Republican senators go out there and David Perdue and Tom Cotton to serve as surrogates, to sort of muddy the waters on what was actually said inside the Oval Office.

Of course, all of that to me is sort of beside the point here because there are facts that everyone agrees on. He himself, the president, says he used some tough words. Clearly, they were disparaging words about the countries of origin for people who are coming as immigrants to the United States and the words were damaging enough to cause people in the room to have concern that a DACA deal is now in danger. So, all of that is agreed upon by everyone in the room. That's bad enough.

BLITZER: Good point. All right. Everybody, stand by.

Much more news right after this.

(COMMERCIAL BREAK) [18:59:13] BLITZER: Tonight as we remember the legacy of Martin Luther King Jr., listen to the words of Dr. King's children and look at some of the events honoring his legacy.


MARTIN LUTHER KING III, MARTIN LUTHER KING JR.'S SON: One of my favorite quotes of my father's that we should all think about employing because he said the ultimate measure of a human being is not where they stand in times of comfort and convenience but where they stand in times of challenge and controversy.

BERNICE KING, MARTIN LUTHER KING JR.'S DAUGHTER: My dad said men hate each other because they fear each other. They fear each other because they don't each other. They don't know each other because they are not communicating with each other.

MARTIN LUTHER KING III: He went onto say that sometimes we must take positions that are neither safe nor popular nor politics but we must take those positions because our consciences tell us they are right.


BLITZER: The Reverend Dr. Martin Luther King, a truly, truly great man.

That's it for me. Thanks for watching.

"ERIN BURNETT OUTFRONT" starts right now.