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CNN TONIGHT

Trump's Lawyers Says No to a Mueller Meeting; Schiff Memo to be Released; Stock Markets Deep Dive Today; Stock Markets' Fall Blamed on Trump; Nunes Memo Phase Two. Aired 10-11p ET

Aired February 5, 2018 - 22:00   ET

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


(JOINED IN PROGRESS)

[22:00:00] ERIN BURNETT, HOST, CNN: This is CNN Tonight. I'm Erin Burnett in tonight for Don Lemon.

And we have breaking news this hour. The president versus his lawyers. The New York Times is reporting tonight that the president's top attorneys are counseling him to stay away, steer clear of a sit-down with Robert Mueller. President Trump, though, may have different plans.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Do you have a date set?

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I don't know. No. I guess they're talking about two or three weeks, but I would love to do it.

UNIDENTIFIED FEMALE: In person?

TRUMP: you know, again, I have to say subject to my lawyers and all that, but I would love to do it.

(END VIDEO CLIP)

BURNETT: Also breaking, the House intelligence committee voting unanimously tonight to release the Democrats' memo. It is of course a rebuttal to the republican document released Friday, the so-called Nunes memo, that President Trump claims vindicates him in the Russian investigation. The big question, though, will the president agree to release the democratic version unchanged to us the public?

And free fall on Wall Street. The Dow Jones today tanking nearly 1200 points and already in early trading for tomorrow plunging another 500. It closed today one the biggest one day point decline in American history. The president, who relishes in taking credit for the day to day market highs, refusing to answer questions about the plunge even though he was speaking live to a crowd about the economy as the market hit free fall.

And Democrats treasonous? The president using that word against Democrats for not applauding him enough in his state of the union address. (BEGIN VIDEO CLIP)

TRUMP: They were like death. Un-American. Un-American. Somebody said treasonous. I mean, yes, I guess, why not? Can we call that treason? Why not?

(END VIDEO CLIP)

BURNETT: A lot to get to in the hour ahead, though. I want to begin with CNN White House correspondent Pamela Brown and CNN congressional correspondent Manu Raju, both of you with me tonight.

Pamela, let me start with this breaking news. A new report in the New York Times this hour saying the president's lawyers, including John Dowd, Jay Sekulow and other advisers are saying don't do it, don't talk to Bob Mueller. You have been reporting with Gloria Borger on a lot of this over the past week. What can you tell us tonight?

PAMELA BROWN, JUSTICE CORRESPONDENT, CNN: That's right, Erin, in fact, the president's lawyers have been in the president's ears telling him for quite some time that he should not testify. The concern is that, it would be a perjury trap even a sit down interview with Robert Mueller and his team. The concern it would be some sort of fishing expedition and that it would basically set up the president where he could be caught in a lie.

Now as you know, the president has been outspoken about his desire to want to sit down with Robert Mueller. He even said he would love to do so under oath, but under that caveat that he would only do it with the advice of his lawyers.

And the lawyers have been telling the president he shouldn't do it, and they're making the argument to Robert Mueller's team that they have not met the threshold of interviewing the president.

They are making the argument that the president isn't just like anyone else and that they haven't shown enough evidence to prove why they need to sit down to interview the president to learn his state of mind in the obstruction of justice Russia probe.

The lawyers are arguing they have enough as it is and they do not with him to testify.

BURNETT: So, Pamela, what is the timeline. You know, we talked about testifying, I'd love to do it. Wait for my lawyers. Now they are saying no. When do we get an answer from the White House to set up the stage for either the interview or the showdown?

BROWN: Well, that's a good question. Negotiations are ongoing, we're told. But the president's lawyers telling Robert Mueller's team that their client, the president, will not sit down for an interview. That could certainly set up Robert Mueller's team coming back and saying, well, then, fine, we'll just issue a subpoena and compel the president.

So it's an open question right now what will happen. My sources tell me that they're sort of in the middle of negotiations right now. Normally what happens, if you start on both sides of the spectrum? One side is on, you know, the opposite side from the other, and so that's why they are right now, and they're ongoing negotiations. But the president has made it clear he wants this wrapped up sooner than later, he does not want a court fight.

BURNETT: And Manu, you have a new report tonight on Steve Bannon obviously central to a lot of this investigation and a big development there on Capitol Hill. What's going on?

MANU RAJU, SENIOR CONGRESSIONAL CORRESPONDENT, CNN: Yes, that's right, the House intelligence committee has wanted to speak to him for a second time. If you recall, he spoke they met with him for several hours behind closed doors last month. But he did not answer a number of questions from the members, particularly what happened after the campaign season? What happened during the transition related to contacts with Russia?

What happened in his time in the White House, including the firing of James Comey, and efforts to talk about the Trump tower meeting that occurred in June of 2016 and the statement that came out afterwards that gave a misleading impression of exactly what happened.

Well, Bannon would not answer that last month. He angered lawmakers. They issued a subpoena asking him to come back and respond to the questions. Well, it turns out he's not going to show up.

[22:04:54] Tomorrow is the deadline, Erin, for him to come back to the House intelligence committee. An appearance has been delayed twice already, and we're told that -- Kara Scannell and I are told by a source who is familiar with the process that Bannon will not show up tomorrow, he's not expected to show up for this appearance, raising the possibility that Republicans and Democrats could potentially hold him in contempt for not showing up.

He seems to be willing to risk that possibility, Erin, but he does not want to answer these questions. And you'll recall the White House urges his attorney not to answer these questions because they want to preserve the right of the president to invoke the executive privilege.

BURNETT: And of course, Manu, to many watching, saying, OK, the House intelligence committee, I mean, come on, they're completely dysfunctional right now. But you did have something there happen today with that vote on the democratic rebuttal, the Schiff memo, which is going to rebut the Nunes memo on the GOP side.

A few days ago, party line they voted no way, they're not going to send that democrat memo out, only the republican memo out. And today, a totally different story. What happened?

RAJU: Yes, that's right. Because last week the Republicans claimed that they had just seen the Schiff memo, the democratic memo. They said they wanted to follow the same process as the Nunes memo. Give the full House an opportunity to review this in a classified setting, then they would agree to send it to the president. Democrats last week said, hey, wait a minute, why don't we hit the

brakes on the Nunes memo and send both the Nunes and the Schiff memo out to the president at the same time, send them out publicly so there are two points of view that the American public could digest.

Well, this week, the Republicans didn't agree with that last week. They moved ahead with the Nunes plan. Now they agreed to move ahead with the Schiff memo. They have tonight they voted unanimously, Republicans and Democrats giving the president five days to decide whether or not to object or allow the release of the memo, and the question is, what will the president do, which we don't know yet.

And if he blocks a release, will the House members agree to override the president for blocking the release of the Schiff memo? That is an open question tonight, too, Erin. A lot of Republicans not willing to go that far yet, saying we hope the president releases the memo, but the president has not said what he's going to do, Erin.

BURNETT: And that's a crucial question. Now Pamela, I want to get one other big story to you here. That, of course, the plunge in the markets. I've been there on the stock exchange floor for a lot of plunges, but on an absolute point day, we've never seen one like today.

And it was happening, the free-fall, the absolute low of the market while the president was speaking live in Cincinnati, touting how great the economy was and how great jobs were. And you know, usually as we all know when the market goes up in those sort of speeches, he jumps to take credit.

Today he was silent, he didn't take questions afterwards about it.

BROWN: Right.

BURNETT: What's the White House reaction to this?

BROWN: You know, it really was quite the dichotomy. You had the president on one side of the screen touting the economy, on the other side seeing the Dow plunge.

The White House released a statement from the press secretary Sarah Sanders basically saying that the White House is focused on the long- term economic fundamentals, that long term the economy is doing well under the Trump administration, particularly with the tax reform bill that was passed, that Americans are going to see more money in their pockets.

Basically, saying that this is going to be short-lived. But as you pointed out, Erin, this comes after the president has repeatedly touted how well the stock market has done under his administration. Take a listen to some of the things he said about that.

(BEGIN VIDEO CLIP)

TRUMP: The stock market has smashed one record after another, gaining $8 trillion and more in value in just this short period of time. The United States is doing fantastically well, better than we've done

in decades. The stock markets are incredible.

You're seeing what's happening with the stock market. People are appreciating what we're doing.

The stock market is way up again today, and we're setting a record literally all the time. And I'm telling you, we have a long way to go. And had the other side gotten in, the market would have gone down 50 percent from where it was.

(END VIDEO CLIP)

BROWN: So the reporters asked the president today when he came back to the White House from his trip in Ohio what his reaction was to the stock market's nose dive today. He did not take reporters' questions.

The question is, was he briefed about this, my colleague Jeff Zeleny says he was likely briefed on the motorcade on his way back from Ohio. My colleague Dan Merica said on the Air Force I, there was Fox was turn on talking about what was happening with the stock market.

And then he said a few minutes later that TV was turned off and then turned back on eventually, so it's unclear if the president never saw the coverage board Air Force One, Erin.

2BURNETT: All right. Thank you both very much. I'll put a wager out there that he definitely saw it. But I heard about if from many people in many ways. OK. Thanks to you both.

And I want to go now to Congressman Ted Lieu, a California democrat. And Congressman Lieu, good to have you with me. I appreciate you coming on. We had a lot to get to. I want to start with the breaking news at the top of the hour.

[22:09:54] The New York Times report that the president's lawyers don't want him to sit down with Bob Mueller, with the exception of Ty Cobb. They're worried he could be charged with lying to investigation. If he says now, congressman, then what?

TED LIEU, (D) UNITED STATES REPRESENTATIVE: Well, then American people will need to ask, what is the president hiding? And I encourage the president to talk to special counsel, because if, in fact, the president has done nothing wrong, he would want to talk to the special counsel and try to clear everything up.

So, I don't know why his attorneys wouldn't want him to talk to the special counsel unless they thought he had something to hide.

BURNETT: So even if there are some sort they think he's going to catch him on some sort of a perjury trap, it doesn't even have anything to do with like Russia as an example. You wouldn't buy that a possible concern. 2

LIEU: Well, the best way to not commit perjury is just to not lie. The president can go into an interview, he can tell the truth, and if he really didn't do anything wrong, then he would want to do this interview. If he doesn't do the interview, then I think that shows consciousness of guilt. I'm a former prosecutor and basically what that means is what would an innocent person do that a guilty person would not?

BURNETT: Consciousness of gilt. All right, I want to get to the other breaking news. Congressman, the House intel committee, that unanimous vote with a such an about face from last week, right, where it was party line against the democratic memo, now unanimous. Schiff's memo the rebuttal memo to the Nunes memo, they want to release it, and it is a big development.

Do you believe the president -- it's now in his hands, congressman, as you know. Will he release that memo without redactions?

LIEU: I think it was a pretty strong statement that it was a unanimous vote, Republicans and Democrats saying release this memo. I have read the memo multiple times.

Anyone reading it will come to three conclusions. First, chairman Nunes and the president are misleading the American people. Second, there is overwhelming evidence to have issued these multiple surveillance warrants on Carter Page.

And finally, that the FBI and Department of Justice did nothing wrong. In fact, the American people will be proud of actions taken by the FBI and Department of Justice.

BURNETT: So I want to ask you about something in there that I'm very curious about whether there is a rebuttal for. But first, since you said you have seen the memo and read it multiple times, Devin Nunes, the chairman of the House intel committee and of course, he, of the Nunes memo, talked about some of what is in Schiff's memo on Fox News, and here is what he said.

(BEGIN VIDEO CLIP)

DEVIN NUNES, (R) UNITED STATES REPRESENTATIVE: Part of the reason why we know that we're right is because the relentless attacks on me, Trey Gowdy -- I mean, they even go as far in their memo to attack Trey Gowdy and myself in their memo. And they come to conclusions.

And what do they said for 10 days. They said that our memo came to all sorts of conclusions. Our memo didn't come to any conclusions, our memo just listed facts. In their memo, people will see they actually come to conclusions and have personal attacks on myself and Chairman Gowdy.

(END VIDEO CLIP)

BURNETT: Personal attacks?

LIEU: You know, Chairman Nunes did not read the underlying evidence before he wrote his memo. Adam Schiff did. And I'm not sure Chairman Nunes actually read the same memo that I have read multiple times. There are no personal attacks in the democratic memo on either Devin Nunes or Trey Gowdy.

And by the way, keep in mind, that Chairman Gowdy has said repeatedly the Nunes memo does not in any way discredit special counselor Mueller's investigation.

BURNETT: He has said that. Now, the president today, I don't know if you heard this, congressman, but he appeared to reference the Nunes memo allegations against the FBI specifically and with great relish, may I say. Here he is.

(BEGIN VIDEO CLIP)

TRUMP: We need people that are going to do a great job and keep us in the right direction. You know?

(APPLAUSE)

We need them badly, too. Or it all goes back to where it was and worse. But did we catch them in the act or what? Did we catch them in the act! They are very embarrassed. They never thought they would get caught. We caught them. We caught them. So much fun. We're like the great sleuth.

(END VIDEO CLIP)

BURNETT: And the Nunes memo, contrary to what the president says, is misleading. Some things in it are factually wrong, as you have pointed out, congressman. But let's take one thing. It said that the FBI did not corroborate allegations in Steele dossier that were used to apply for the Page FISA warrant.

Congressman Schiff, the author of the democratic memo, and I quote him, quote, "Portions of the work that Christopher Steele did were included and some were corroborated."

The question to you, congressman, is some were corroborated but not all? Aren't the Republicans right that at least this demands further investigation?

LIEU: Even after all this noise, the Republicans cannot say a single thing in terms of the Steele dossier being false. The Nunes memo says it has salacious allegations in it. Salacious doesn't mean false. And there is nothing out there that says the relevant parts of the Steele dossier were false, and Adam Schiff is right.

There was also corroboration and you read that the democratic memo and you cannot come to any other conclusion than there was overwhelming evidence to issue surveillance warrant on Carter Page regardless of whether the Steele existed or not.

[22:15:03] BURNETT: And that's the crucial point, right, if you didn't need it all. But if they included it and they included on the corroborated point, you point out but it doesn't mean they're false. It also doesn't mean they're true. And if you're trying to get surveillance on a U.S. citizen, I'm just pointing out, isn't that an issue? LIEU: If you read what Adam Schiff said, he actually said that the

relevant parts of a Steele dossier were in fact corroborated. And keep in mind, these were FISA judges that were appointed by Chief Justice John Roberts, a republican. They have to consider all the various factors and appropriate disclosures were made to the FISA judges about the Steele dossier.

BURNETT: All right. Congressman Lieu, I appreciate your time. Thanks for coming on.

LIEU: Thank you.

BURNETT: And next, more on the breaking news after saying he was eager, would love to sit down with Bob Mueller. Some of President Trump's legal team are now saying no. More on the legal challenges such an interview would pose for the White House, next.

(COMMERCIAL BREAK)

BURNETT: Breaking news on the Russia investigation tonight. President Trump's lawyers are deciding him not to sit down with special counsel Robert Mueller for an interview.

I want to bring in Ambassador Norman Eisen, CNN contributor and former White House ethics czar, along with legal analyst Laura Coates and Philip Lacovara, former counsel to the Watergate special prosecutor.

And all of you, thank you. Laura, tonight the New York Times reporting President Trump's lawyers, all of them but one, Ty Cobb, the one in the mustache, wants him to refuse an interview with the special counsel.

[22:20:01] Precedent to president does not go in that direction. The simple question to you is, can he do it? Can he refuse?

LAURA COATES, LEGAL ANALYST, CNN: Well, he could, and that go in before the Supreme Court eventually trying to argue, I mean, it has no merit. He really has three choices, Erin. He can either testify, being a cooperative witness, or he could testify with a subpoena, or he could wait for the Supreme Court and tell him about options one and options two.

Because frankly, he really doesn't have a good legal leg to stand on as to tell why he believe he is not entitled to having the same demands upon him as any other perhaps white color defending, if he is a defendant to say you must testify.

And you can do it the easy way and just give him a schedule and try to accommodate it, or you got this grand jury subpoena power that Mueller has in his front and his back pocket can wield against him. He doesn't really have another recourse here.

BURNETT: So, Philip, what is at stake? I mean, they're talking about their concerned, you know, according to the New York Times reporting here that he could be charged with lying to investigators. Now what constitutes a lying charge in an interview with President

Trump? And I do not say this to be light, but there is lying about your ratings, there's lying about your crowd size, there are all kinds of lies that he commits every single day.

Then there's lies about the big matter at hand, Russia. So is it any lie they're concerned about or only the Russia section?

PHILIP LACOVARA, FORMER WATERGATE COUNSEL: No. I think they're only concerned about his lying about what's relevant to the Mueller investigation. In order to make out a federal crime of lying to an FBI agent or testifying falsely under oath, you have to show that the line of questioning is material to the investigation.

BURNETT: Right.

LACOVARA: So, merely lying about how big the crowd was for the state of the union address or the inaugural address would not be relevant. That would not be the jeopardy that they're worried about.

BURNETT: Right, I mean, I simply say that to make the point, that he does lie about all these things. They're worried about the one thing at hand, and if he can't tell his straight story it would seem -- well, if you have nothing to hide, you should talk, right?

Which, Norman, brings me to the question of, are they trying to use this as a negotiating position so they don't have to do it in person because that's when he opens himself up to all sort of hyperbole, exaggeration, and lies, and they're trying to have it be on paper where basically his attorneys can write it for him?

NORMAN EISEN, UNITED STATES AMBASSADOR TO THE CZECH REPUBLIC: Erin, I'm sure the president's lawyers would love to be able to do written interrogatories and craft the president's answers. But they are not going to get away with that.

We see this whenever a president has to testify, this brinksmanship where the president's lawyers fight, fight, fight until the last minute when the subpoena is about to drop.

That's what happened with Ken Starr, and right before the president was going to be served with a subpoena, he's lawyer, David Kendall, called Starr and said, no, no, no, we'll cooperate. That's what's going to happen here. The president has got to speak in order to rebut this accumulating evidence of obstruction of justice.

BURNETT: Laura, it's a game of chicken, though. Mueller has to take the risk that he's going to get that subpoena from the grand jury. The president has to take the risk that he won't, right? I mean, who is taking a bigger risk here? Is it risk free for Bob Mueller to go that route of having to force a subpoena?

COATES: Well, my money in the game I think...

(CROSSTALK)

LACOVARA: I don't think...

COATES: ... would actually be with Robert Mueller who I doubt will actually swerve his hand wheel at any point in time. I think what you have here is a game where as long as Trump's legal team can negotiate, they are in a position of some relative power.

They can maybe negotiate about the length of time, maybe they can negotiate the terms of the questioning. They can be there possibly president to say things like, are you sure you're asking him this, be very careful about what you answer.

I think when he's asking you it's almost like a conduit of information for that point in time. So they're trying to have this way of brinkmanship as explain to you in an effort to try to have some bargaining power.

But at the end of the day, this is a courtesy that's even requested for a voluntary conversation when you have the weight of the grand jury. I think it's pretty (Inaudible) he was able to have the grand jury subpoena power, he has an active investigation, he can certainly wield that authority at any time.

BURNETT: Philip, we know Ty Cobb is the president's attorney, as I referred to him the one with the mustache as sort of the 18th century style. He has apparently been the one, according to the New York Times who was saying cooperate, go ahead and do what they want, against others like Jay Sekulow.

Do you think there is a real divide within the president's counsel, or is this simply them vis-a-vis this leak to the press, playing good cop, bad cop.

LACOVARA: I think there probably is a difference of opinion among the president's lawyers, because as we've discussed, there are some real risks for the president, both politically and legally, either course that he takes.

And it's not surprising that two different sets of lawyers may have different agendas. Ty Cobb has a good sense of what it's like to be on the counseling side dealing with a client who is facing some serious legal jeopardy.

[22:25:01] And I think he's making a decision that the president could get away with appearing before Mueller and not get himself mixed up in what's called a perjury trap.

BURNETT: All right. Thank you all very much. I appreciate your time tonight.

COATES: Thank you.

EISEN: Thanks.

LACOVARA: Thank you.

BURNETT: And the president declaring he has been vindicated in the Russia investigation. In fact, then he says Trump has been vindicated but the word Trump went in quotes.

But it is not just Democrats but some Republicans who say, hold on. Why members of the president's own part are saying the Nunes memo still leaves many questions about Russia and the Trump campaign. Mike Rogers, former chairman of the House intelligence committee, is among our guests.

(COMMERCIAL BREAK)

BURNETT: Big move by the House intelligence committee, that unanimous vote to make the Democrats' rebuttal memo public.

And joining me to talk about this, our national security commentator Mike Rogers who is the former chairman of this committee and Michael Isikoff, chief investigative correspondent for Yahoo News, author of "Russia Roulette: The Inside Story of Putin Has Won America and the Election of Donald Trump" and the man also now known as central to the Carter Page FISA memo.

So, thank you both.

Let me start with you, Mike. The House intel committee with this unanimous vote, and as I pointed out that's a big deal, it's a big turnaround from last week when they said we're not going to send the democratic memo out and they did on party lines. Now unanimous, they're going to push it out.

Will the president, Mike, let it go out without redacting key parts of it?

MIKE ROGERS, NATIONAL SECURITY ANALYST, CNN: Well, I mean, that really does depend on what's in it. And if there are sources and methods anywhere in the memo, then those parts will have to be and should be redacted.

If not, you know, if these are the same -- its conclusionary statement a lot like what the republican memo was a bunch of conclusionary statements, then they should let that out as well. And now we're back to this dueling memo, very politicized. Hard to find the truth in all of that.

ERIN BURNETT, HOST, CNN: So, Mike, I remember the night before the president OK the release of the Nunes memo, you told me it's a done deal and we're hours away and you were completely right. Is it a done deal that he will go ahead with the committee's unanimous vote and release the Schiff memo?

MICHAEL ISIKOFF, CHIEF INVESTIGATIVE CORRESPONDENT, YAHOO NEWS: You know, I don't get -- I'm not sure I get a sense of that. I don't think anyone knows where he's at on this, so I think he will do through the process. I think their national security team is going to look at it.

If, in fact, that the Democrats went to the Department of Justice, if they went to the FBI and tried to clear up some of that language, I think it would be harder for the White House not to release it if they had already this pre-approval from DOJ and the FBI, that's for sure. BURNETT: So, you know, Michael, there is this whole back and forth

today about whether there is going to be redactions. Schiff has already talked about political redactions, is the word that he has used, right? To basically, already put it out there, that if there is redactions, it's not about national security, it's all about politics.

And then Congressman Lee Zeldin, republican, said Schiff purposely leaded this whole memo up with all kinds of sources and methods so there would be redactions and then he could try to, you know, cry foul on the situation. What happens here from now, Michael?

ISIKOFF: Well, look, this is extremely complicated. Because, you know, the Democrats, in order to rebut what they believe to be, to see like activity and aspects of the republican memo, have put together a document that makes the case for why this was a legitimate FISA surveillance warrant on Carter Page.

And in order to do that, you have to lay out the evidence that the FBI had on him. You know, we heard Congressman Lieu just a few minutes ago on your show say that there was corroboration that the FBI had for some aspects of what was in the Steele dossier.

We haven't see it, we don't know what it is. But it is a bit problematic to be releasing a memo that tarnishes somebody like Carter Page as a Russian agent when he hasn't been charged with a crime.

So, you know, that may sound a bit odd given, you know, that I did the first story that the FBI was investigating Carter Page, but I could see how it could be quite difficult to leave aside the politics of this, release the full democratic memo if it has all the evidence that the FBI presented to the FISA court.

BURNETT: So, a crucial question need to be. First, Mike Rogers. The president says the Russian memo vindicates him, right? His son came out and said it's sweet revenge for the Trump family. The president said it is vindication.

But that has caused a backlash, not among Republicans but among Republicans including Trey Gowdy who is basically the person who wrote the Nunes memo. Here are some top Republicans responding to the question, did this memo vindicate the president?

(BEGIN VIDEO CLIP)

JAKE TAPPER, HOST, CNN: Do you agree that it vindicates Trump?

UNIDENTIFIED MALE: I think this is a separate issue.

UNIDENTIFIED MALE: So you don't agree with President Trump when he says this vindicates him in the entire Russia investigation?

UNIDENTIFIED MALE: I don't.

TREY GOWDY, (R) UNITED STATES REPRESENTATIVE: I actually don't think it has any impact on the Russia probe for this reason.

UNIDENTIFIED FEMALE: The memo has no impact on the Russia probe.

GOWDY: Not for me it doesn't, and I was pretty involved in the drafting of it. There is a Russia investigation without a dossier.

(END VIDEO CLIP)

BURNETT: They are standing up to the president, Mike Rogers, loudly and clearly.

ROGERS: Well, I mean, with all the shooting going on in Capitol Hill, it means that there are real casualty is going to be the truth. And what's going to happen is, now we'll likely get some form of a democrat memo.

You're going to have, apparently the chairman of the intel committee says now they're going to do something on the secretary of state or department of state misconduct and release some kind of a memo.

It all serves so that the credibility of anything that comes out of the committee now is worthless. Republicans are going to love it, Democrats are going to hate it, or vice versa, depending on what the outcome is.

And that casualty of truth is really important. We've already heard from FBI folks saying, hey, this is starting to have an impact, be careful.

BURNETT: Yes.

ROGERS: You know, it gets to the point where it can get pretty reckless and I think we're pretty darn close to that here.

BURNETT: Which is a big statement to make. You, as obviously former FBI, member of the FBI herself and chairman of the very committee that Devin Nunes now chairs.

Michael, you are central to the Nunes memo, and as I mentioned with Congressman Lieu earlier in the hour the memo claims the FISA application for Carter Page cited the dossier written by Christopher Steele and then used your article to corroborate the dossier claims, even though Steele was a crucial source for your article.

[22:35:06] You have called this reasoning circular, you've been open about it. Now you've had time, you've been doing more reporting, you've talked to other people, you're at the center this.

Michael, do you know enough tonight to think that it does this point about your article corroborating the dossier calls the entire article for Carter Page into question or not?

ISIKOFF: I don't think one can reach that conclusion based on what we know now. We don't know what it is that they cited my article for. My article, if you go back and read it, quotes a lot of different sources about a lot of different aspects of this, Page's background, his coziness sympathy for Putin's positions, some of his business activities. Adam Schiff has said that the aspects -- the parts of my article that were cited to the FISA judge did not relate to that which came from the Steele dossier.

Now, I haven't seen the FISA application. I'm just hearing dueling sides. I'm reading the republican memo. I see what Adam Schiff says. Without seeing the actual FISA application, it's very hard to know to what extent there might have been any circular reporting here, if there was.

BURNETT: All right. Thank you both very much. And as Mike Rogers says, that puts us in a very dangerous position. The FISA application, by the way, Congressman Jackie Speier told me it was 50 pages. So we've seen three and a half page, cherry picked summary of it 50 pages. Until we see all of it, we won't know.

All right. Thanks. And when we came back -- come back, just moments after President Trump said in a stump speech, we're starting to boom. There was a boom but it was more of a bad sort of explosion as the stock market plunged epically. So what went wrong? And is the president to blame?

[22:40:00] (COMMERCIAL BREAK)

BURNETT: President Trump delivering high praise for the economy at a pretty horrific time for stocks. While the president linked economic gains to his policies, including the tax reform plan during a speech in Ohio, the markets were plunging, and even on Fox News they had to break into his speech and cut it off to talk about the market.

The Dow dropped more than 1,100 points today alone, and as we pointed out, that is the single biggest point drop in American market history.

So who do we bring on to talk about this? Steve Moore, former senior economic adviser to the Trump campaign, and Robert Reich, former labor secretary and author of "The Common Good." Thanks so much to both.

So, Steve, he brags, he brags, he brags. This is the problem. He brags about the markets all the time. Even in Davos, he said if Hillary had won, they would have gone down 50 percent. And I have to play this for everyone lest they forget on days in the middle of the day when he speaks the markets is going up, here's what we usually hear.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The stock market has smashed one record after another, gaining $8 trillion and more in value in just this short period of time.

The United States is doing fantastically well, better than we've done in decades. The stock markets are incredible.

You're seeing what's happening with the stock market. People are appreciating what we're doing.

The stock market is way up again today, and we're setting a record literally all the time. And I'm telling you, we have a long way to go. And had the other side gotten in, the market would have gone down 50 percent from where it was.

(END VIDEO CLIP)

BURNETT: OK, he's not there.

STEPHEN MOORE, SENIOR ECONOMIC ANALYST, CNN: A lot of people thought it would go down 50 percent if Trump was elected.

(CROSSTALK)

BURNETT: They did. I remember when they said that. But here's the question. It is silly for anybody to take credit for a market going up on any given day.

MOORE: Well, on a given day, of course.

BURNETT: OK. Therefore it would be silly to not take the blame for going down on a given day except if said individual takes credit for every time it goes up.

(CROSSTALK)

MOORE: Let me just go into. I mean, the day after the election, the Dow went up 700 points. So that was an indication that there was a lot of euphoria in the markets about this new pro-business president. Look, this is the last two days...

(CROSSTALK)

BURNETT: So what do you say about that today, though?

MOORE: Pardon?

BURNETT: So then what about today?

MOORE: They're terrible. I mean, the last two days have been horrible. The Dow lost 800 points, the two of the worst days we've had in a long, long time. I've -- look, we're still -- the Dow was still at a little less than 25,000. It was 18,000 when he was elected. So this has been a big bull market rally.

What is interesting to me, and I'm glad I'm on with Robert Reich because he was the labor secretary. You know, Bob, what concerns me about this is Wall Street seems to hate when we get wage increases for workers.

I mean, this was really one of the triggers from this on Friday, remember? We got a pretty good jobs report, we got a 3 percent increase in wages, and all of a sudden Wall Street freaks out because they believe this is inflationary. And I think one think that Bob Reich and I agree on, we want higher wages for workers.

BURNETT: Bob, do you buy this? You have turned the conversation, Steve. Go ahead, Bob. ROBERT REICH, SENIOR ECONOMICS ANALYST, CNN: You know, yes, I do

agree that we do need higher wages for workers and that's a good thing.

BURNETT: Yes.

REICH: But there are two pieces of advice -- I've given economic advice to a number of presidents. There are two basic pieces of advice that economic advisers do give. Steve, I'm curious whether you gave this to Donald Trump.

Number one is, you don't link your administration and your policies to the stock market. Because Isaac Newton's law falls with the stock market. What goes up eventually comes down. And you're going to have egg on your face.

The second piece of advice is more substantive, and that is when you have low economy, when the economy is basically functioning at full capacity don't stimulate it with a gigantic either spending or tax cut because you are flirting with inflation.

BURNETT: Yes.

REICH: And if you have inflation or if you're flirting with inflation, the interest rates go up and the stock market goes down.

MOORE: Well, there is no question...

(CROSSTALK)

BURNETT: But should tax reform be part of the problem here?

MOORE: No. Look, I think that the stock market loves the tax cut. I think we're seeing raises for workers, we're seeing bonuses for workers. We're seeing a lot of -- this is a supply side. This is where Bob Reich and I disagree.

[22:44:58] This isn't about putting money into the hands of employees, although it will do that. It's about supply side. Getting business to invest more, hire more workers and so on and they have an incentive to do that.

So, Bob, that's why I don't think this is an inflationary tax cut. And that's why I'm puzzled. I mean, look, today, well, I was just showing you up there, the Wall Street Journal says, you know, corporate profits were very good, you've got great numbers on jobs. You've got all these positive things and that the stock market...

(CROSSTALK)

BURNETT: OK. But corporate profits have been doing really well for a really long time and wages have been coming along.

MOORE: Right.

BURNETT: Now you're going to look at the recent wage numbers. But what I want to ask you is then why aren't companies announcing? Every company that's come out and credited the tax cut has credited it with a bonus. And a $1,000 bonus is not as much as they would give a worker if they were giving a full-time raise.

(CROSSTALK)

MOORE: Well, not...

BURNETT: And it's also a one-time raise.

MOORE: What about the -- you know, the biggest employer in the country is Wal-Mart. And Wal-Mart gave, you know, they have almost a million workers are getting increases. They raised their minimum wage 11 to $13 an hour.

BURNETT: They raise wages last year and they raise wages the year before that. That's three years in a row without a tax cut. Go ahead, Bob.

REICH: But, Steve, Steve Moore, I mean, these ages, Erin is exactly right. These wage increases are very, very tiny relative to the corporate tax cuts. Most of the benefits of the tax cuts are going and will go, and you look at the buybacks that are being scheduled they are already underway, are going to shareholders and to executives.

The point is that Friday's job report did show, and here where is Steve, you were absolutely right, did show a little bit of an uptick in wages but that was enough. Given full employment, given that we are almost at full utilization, that was enough to sound the alarm about what the new head of the Fed is likely to do about inflation.

And you couple that with the fact that also with the tax cut, you had to move up the time at which the debt limit is actually going to be hit, and there is even more uncertainly because there is no plan to raise the debt ceiling.

And given all of that uncertainty, coming Friday and today, you've got, you know, markets hate uncertainty. Everybody knows that a correction was coming, but it all came today and it was largely, frankly, that anybody expected.

(CROSSTALK)

MOORE: Prosperity, higher wages, more people working does not cause inflation. I just reject that theory, and I think that there is a misinterpretation of what's going on in the American economy. I'm bullish...

(CROSSTALK)

BURNETT: All right. We'll hit pause there. I will say the one thing though when this talking about is the fact that that is skyrocketing in general and that a lot of people used to care about it when Obama was president, and now they're the ones running it up and at some point there is going to be a come to Jesus on that again.

(CROSSTALK)

MOORE: We need growth. We got the...

REICH: And we have the markets...

BURNETT: They told me I have to go. I'm guest hosting tonight, I cannot be rude.

REICH: We have a new fed. We have a new Fed and nobody knows how that is going to deal with this.

BURNETT: Thank you both. All right. Coming up, much more on our breaking news. The president's legal team trying to see him clear from a sit down with the special counsel, although the president has said that's just what he would love to do.

Plus, Trump labeling some democrat as treasonous. You'll hear why.

[22:50:00] (COMMERCIAL BREAK)

BURNETT: The president was on the road today talking about his tax plan. And then going off script, accusing Democrats of treason for not clapping at the state of the union.

Joining me now, our political commentators Joan Walsh and Mike Shields. Thanks to both. So, Mike, let's play it. Let's play the president and the treason comments.

(BEGIN VIDEO CLIP)

TRUMP: They would rather see Trump do badly, OK, than our country do well. That's what it means. It's very selfish. Even on positive news, really positive news, like that, they were like death. And un- American. Un-American.

Somebody said treasonous. I mean, yes, I guess why not? Can we call that treason? Why not? I mean, they certainly didn't seem to love our country very much.

(END VIDEO CLIP)

BURNETT: Mike, was that a joke that was OK to make? Treason, of course, a very specific term in the Constitution and not a word to take lightly.

MIKE SHIELDS, POLITICAL COMMENTATOR, CNN: It was a joke and you heard the crowd laughing. It's obviously not the position of the White House. They haven't put out any official thing saying this is our official position, we believe we're going to have trials for treason.

I mean, he was joking with the crowd. I don't think he should make that joke, I think it's inappropriate, I think it takes away from the core message that he had, which is a very valid message, which is that the Democrats were so partisan that at the state of the union, even when he was talking about things about lowest black unemployment in measured history, the lowest Hispanic unemployment in history, consumer confidence being high, all great things that re happening in the country, that the Democrats refused to applaud or do anything to recognize that.

I mean, we've been showing video tonight comparing Republicans during President Obama's state of the union addresses

BURNETT: Yes.

SHIELDS: They wouldn't clap -- yes, they wouldn't clap at times when President Obama was proposing things. Here's my proposal for how I want to essentially create a bigger government, raise taxes, create government-run healthcare, of course they're not going to clap for that.

It's understandable if Democrats don't clap when President Trump is offering something they don't agree with as a proposal. But when he's talking about the country, they let the -- they made a huge mistake, they let their hatred, their visceral hatred of who President Trump is get the better of them and they reflected incredibly poorly on their party.

And so the president made a joke. He shouldn't have made that joke but the underlying point he was making was accurate.

BURNETT: So, Joan, let me ask you about that. OK. Because obviously when President Obama made things like, you know, let's not redraw congressional districts, or things that were political Republicans didn't agree with, they wouldn't stand.

JOAN WALSH, POLITICAL COMMENTATOR, CNN: Right.

BURNETT: But on the issue that Mike is raising, specifically let's take black unemployment. The president said it's an all-time low. By the way, a few days later it ticked up a little bit.

WALSH: It jumps a point, yes.

BURNETT: But on the day he said it was completely true. And it was a fact, right? Why wouldn't some Democrats, just on the fact of it, stand and applaud that?

WALSH: Because they think that he's taking credit for something he has no control over; that he has not contributed to. And that began under Barack Obama. Not saying that Barack Obama caused it either, Erin.

I can't believe that Mike is even defending this a little bit. Like it's a joke to say treasonous. He also called it un-American. He also said that they don't love their country.

We saw today a kind of toddler authoritarian, can't get out of his own way, was supposed to be talking about tax reform, has a decent story to tell so far. Could have said good things about what he's done. But he can't help going after Democrats. He also can't help going after the FBI and the Justice Department. What was that insanity? We're paying attention to treasonous but we're

not paying attention to that crazy segment where he talked about, we got him, we caught him, we beat him, I guess regarding the Nunes memo, which doesn't beat or capture, anything of the kind. I mean, he's deranged out there.

BURNETT: Mike, what about the point that she makes? Un-American.

[22:55:00] SHIELDS: Well, she just called the president deranged, she called him a toddler. And so I hardly think the best way to talk about the discourse in the country is to -- she used the kind of invective...

(CROSSTALK)

WALSH: I didn't call him un-American.

SHIELDS: Well, the invective that you used which is disparaging is exactly the kind of rhetoric that is thrown back and forth in politics. The things that Democrats say about the president on a daily basis, they call him treasonous, they say that every day about the Russia investigation. And so, look, I don't think it's OK. I think when the president speaks those...

(CROSSTALK)

WALSH: Steve Bannon called that treasonous by the way.

SHIELDS: I think when the president speaks those words are powerful and he shouldn't have been goaded by the crowd and played up to the crowd, it's something he does at rallies, this was a rally to his base.

But the underlying point he was making is accurate which is that the Democrats have gotten to a point where they are so partisan that they can't even celebrate the things -- if you look at what happened today as the stock market has had a correction, which the past two guests just talked about, people in the media and the Democrats were practically laughing and foaming at the mouth with joy...

(CROSSTALK)

WALSH: I haven't seen that at all.

SHIELDS: ... because they are so obsess -- the tone -- the tone...

WALSH: I haven't seen anything of the kind.

SHIELDS: The tone of the coverage this afternoon. We talk about tone with the president.

WALSH: There's concern...

(CROSSTALK)

SHIELDS: The tone of the coverage of the media this afternoon was, my gosh, look at how badly the stock market is doing when the president has been talking about the economy.

BURNETT: OK.

SHIELDS: There is a -- there is a...

(CROSSTALK)

BURNETT: We have to leave it there.

SHIELDS: ... laughing at that and that is inappropriate.

BURNETT: All right. Thank you both very much. That is it for us tonight. I'm Erin Burnett in for Don Lemon. I'll see you tomorrow night at 7 o'clock Eastern for Erin Burnett Outfront. Jim Sciutto will be continuing our live coverage right after this.

(COMMERCIAL BREAK)