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Flynn's Obstruction Evidence; Bill Barr Targets Russia Probe Origins; Interview With Rep. Ruben Gallego (D-AZ); Barr Comfortable With Trump Calling Mueller Probe A Witch Hunt; Barr Echoes Trump's Spy Theories About Russia Probe As President Tweets About Treason; Biden Making Big Play For Pennsylvania With Rally Tomorrow, Campaign HQ in Philadelphia; China Cancels Major U.S. Pork Import Order As Trump's Trade War With China Hurts The Heartland. Aired 6-7p ET

Aired May 17, 2019 - 18:00   ET

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


[18:00:01]

WOLF BLITZER, CNN ANCHOR: Is the showdown now headed to court?

Why was I not told? The president falsely suggests he wasn't warned about Michael Flynn, as we're now learning more about the investigation of the fired national security adviser and his cooperation with Robert Mueller.

"Lordy, there are tapes." Newly unsealed court records reveal that Flynn gave the Mueller team voice-mail evidence of Trump allies potentially obstructing justice. Will Americans get to hear the recordings for themselves?

And whole hog. CNN is in the heartland, as the president proves he's all in on the trade war with China. Tonight, many pork farmers tell us they're feeling burned.

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 news this hour, the Trump administration is defying another congressional subpoena, this one for the president's tax returns.

Treasury Secretary Steve Mnuchin claiming the demand is not legitimate in a letter sent to the House Ways and Means Committee chairman just a little while ago, this as President Trump is falsely claiming he was not warned about problems involving Michael Flynn, problems that led to the investigation of his now former national security adviser.

Mr. Trump lashing out on Twitter after the bombshell revelation that Flynn told Robert Mueller that people connected to the Trump administration or Congress contacted him in a potential effort to obstruct justice. Flynn backing up his claim by giving Mueller a voice-mail recording as evidence.

I will get reaction from Democratic Congressman Ruben Gallego.

And our correspondents and analysts, they are also standing by.

First, let's go to our Chief White House Correspondent, Jim Acosta.

Jim, Michael Flynn is creating new headaches for the president tonight.

JIM ACOSTA, CNN CHIEF WHITE HOUSE CORRESPONDENT: He certainly is, Wolf.

And President Trump is trying to rewrite history about his former National Security Adviser Michael Flynn's cooperation with the special counsel. The president claimed earlier today that nobody warned him about Michael Flynn. But that's not true.

Both the president and William Barr, the attorney general, we should point out at this hour, they're both warning that they're moving forward with their plans to investigate the investigators.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): Dodging questions from reporters, the president took to Twitter to poke holes in a stunning revelation in the Russia investigation, that one of Mr. Trump's attorneys was in contact with former National Security Adviser Michael Flynn about his cooperation with federal investigators.

The president tweeted: "It now seems that General Flynn was under investigation long before it was common knowledge. It would have been impossible for me to know this. But if that was the case, and with me being one of two people who would become president, why was I not told, so that I could make a change?"

But that's not accurate. Less than one week after Mr. Trump was sworn into office, former acting Attorney General Sally Yates told the White House that Flynn had lied to the vice president about his contacts with the Russian ambassador, a falsehood that could make the national security adviser vulnerable to blackmail.

Those lies were also cited as the reason why the president fired Flynn.

SALLY YATES, FORMER ACTING U.S. ATTORNEY GENERAL: We had wanted to tell the White House as quickly as possible. To state the obvious, you don't want your national security adviser compromised with the Russians.

ACOSTA: The president also knew there were longstanding concerns about Flynn. Former President Barack Obama warned Mr. Trump about Flynn in the Oval Office just days after the 2016 election, something the White House conceded to reporters.

SEAN SPICER, FORMER WHITE HOUSE PRESS SECRETARY: It's true that the president made it -- President Obama made it known that he wasn't exactly a fan of General Flynn's, which is -- frankly, shouldn't come as a surprise to anyone, given that General Flynn had worked for President Obama, was an outspoken critic of President Obama's shortcomings.

ACOSTA: Though the White House denied there were any concerns about what Flynn might tell investigators.

(on camera): Is the White House concerned that General Flynn has damaging information about the president, his aides and associates about what occurred during the campaign with respect to Russia?

SPICER: No.

ACOSTA (voice-over): The president warned he's going after the investigators who worked on the Russia probe, tweeting: "My campaign for president was conclusively spied on. Nothing like this has ever happened in American politics, a really bad situation. Treason means long jail sentences, and this was treason."

In an interview on FOX, Attorney General William Barr echoed the president's talking points.

BILL HEMMER, FOX NEWS: Witch-hunt, hoax?

WILLIAM BARR, U.S. ATTORNEY GENERAL: I use what words I use, and it was an investigation. But I think if I had been falsely accused, I would be comfortable saying it was a witch-hunt.

ACOSTA: And Barr said he too wants to get to the bottom of whether anything illegal occurred.

BARR: If we're worried about foreign influence, for the very same reason, we should be worried about whether government officials abused their power and put their thumb on the scale. And so I'm not saying that happened. But I'm saying that we have to look at that.

ACOSTA: Barr also denied he lied to Congress when he testified about the findings in the special counsel's report.

[18:05:02]

BARR: I think it's a laughable charge. And I think it's largely being made to try to discredit me, partly because they may be concerned about the outcome of a review of what happened during the during the election.

ACOSTA: At a speech to realtors in Washington, the president continued his attacks on the press, accusing reporters of making up stories about tensions over his Iran policy.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Everything is, "a source says."

There is no source. The person doesn't exist. The person is not alive. It's bullshit.

(END VIDEOTAPE) ACOSTA: And the president took issue with reports, as you saw there, that there is friction behind the scenes among his advisers over Iran.

Mr. Trump said his National Security Adviser, John Bolton, and his Secretary of State, Mike Pompeo, are both performing to his satisfaction.

In the meantime, a senior administration official told CNN earlier today the president's national security team is working to provide more evidence or clarity when it comes to Iran's military activity that has been concerning advisers in recent days over here at the White House.

That evidence, the official said, may be more clear to the public here in the coming days -- Wolf.

BLITZER: Let's see. Thanks so much, Jim Acosta, at the White House.

I want to bring in our Political Correspondent, Sara Murray, right now.

Sara, Flynn told Mueller that people were urging him not to cooperate. Why wouldn't Mueller actually bring some charges of obstruction against those individuals?

SARA MURRAY, CNN NATIONAL POLITICAL CORRESPONDENT: I mean, that's a good question, Wolf.

And I think we want to know exactly who was having these conversations with Michael Flynn. It makes it sound, at least from this latest filing, that there may have been multiple individuals who approached Flynn.

It's possible that when Mueller was looking at sort of the sum of all the evidence there, he just felt like the case was a little too flimsy to actually withstand prosecutorial scrutiny, and it wasn't actually worth bringing charges.

But it certainly does raise a lot of questions about who was in the mix in terms of these conversations with Flynn, conversations that continued when they knew that Flynn was cooperating with the government, Wolf.

BLITZER: And now this judge apparently wants not only the transcript of this voice-mail that was left from somebody associated with the administration or Congress, supporter of the president, to Flynn's lawyer, not only wants the voice-mail -- we have the transcript, but he wants the voice-mail actually released, so we hear the audio.

MURRAY: It would be very fascinating if we could hear the audio, because I think it's one thing for the American public, when we get something like the Mueller report. It's about 450 pages.

It's very dense. Most people didn't read it. So it's one thing to sort of know there's a report like that that's out there and that the president did some unsavory things. I think it's another thing to hear someone saying, I'm calling on behalf of the president or I'm calling on behalf of the president's legal team to say, X, Y and Z. Can you tell us what you're telling prosecutors? Maybe you shouldn't tell them this?

Or whatever it is that is included in these tapes. It's different to sort of be able to feel, to see, to hear the evidence than it is to just kind of have that huge binder sitting on your desk, Wolf.

BLITZER: And a key question is whether the president personally was aware that individuals associated with the administration or with Congress were actually trying to influence how far Michael Flynn would go in cooperating with Mueller.

MURRAY: I think that is an important question. It's certainly one that we did not see addressed in this latest filing or in the Mueller report.

But it's the kind of thing where we have already seen Congress pressing obviously for the unredacted Mueller report, but also for some of the underlying evidence. Now, once Flynn is sentenced, they may press for his cooperation as well.

And it's possible that in the run-up to his sentencing or even afterwards, if he does decide to appear before Congress, we could get more information on that. And, again, it's one thing to sort of read all of this on paper, but it would certainly be another thing to see Michael Flynn testifying before Congress and saying, Donald Trump, the president, asked me to do this, his lawyers asked me to do that.

I think that leaves a very different feeling with people at home. It certainly did in the Watergate era.

BLITZER: We will see if that happens. Good point.

Sara, thank you very much, Sara Murray reporting.

Now to the breaking news on the battle over President Trump's tax returns. The treasury secretary informing a top Democrat tonight that he's defying a congressional subpoena.

Let's go to our congressional correspondent, Phil Mattingly. He's up on Capitol Hill.

Phil, the chairman of the House Ways and Means Committee is responding to the treasury secretary.

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: That's exactly right.

The chairman of the committee, Richard Neal, responding that, despite what the Treasury Department says, the department actually has no discretion to decide whether or not to comply with the request for those tax returns. It is in law. The law says explicitly that department shall turn over the returns if requested by the committee chairman, and that is exactly what happened. But Steve Mnuchin in that one-page letter sent today, making him the

latest Trump administration official to defy a subpoena request, said that the request had no legislative purpose, and, as such, he was not authorized to reply or comply with that request.

Now, part of the basis for that decision not to comply with the subpoena comes from the Justice Department. The treasury secretary said now in multiple letters the Justice Department had provided an opinion from the Office of Legal Counsel giving them the basis to decline to respond.

As of this moment, Wolf, that opinion has not been made public, despite the Treasury Department saying at some point it would be made public. It is safe to say that opinion will likely be the basis for a future court case.

Now, the big question becomes, what comes next? As we have seen in other investigations, other subpoenas, Democrats have moved to hold individuals in contempt.

[18:10:04]

At this point, it is not officially decided. Neal, in his statement, saying he would talk to counsel about next steps. But he did tell my colleagues Lauren Fox earlier today that he believes both sides had made up their minds, and it was likely time to go to court.

That, as everyone has known now for about a month, is where this will all be decided -- Wolf.

BLITZER: It certainly will be.

Phil Mattingly reporting for us, thank you.

Joining us now, Democratic Congressman Ruben Gallego. He's a member of the Armed Services Committee.

Congressman, thanks for coming into THE SITUATION ROOM.

REP. RUBEN GALLEGO (D), ARIZONA: Pleasure.

BLITZER: So let's talk about the House Ways and Means Committee Chairman, Richard Neal.

He says he's going to go -- he is going to -- presumably, he's going to have to go to court now, because the Treasury Department has decided they're going to ignore this congressional subpoena for six years of the president's tax returns. This could drag on and on and on, maybe even beyond the 2020 election.

GALLEGO: Well, I would hope not.

I mean, the legislation's pretty clear. It doesn't say may. It says shall. And our legislative intent is part of our oversight under the Constitution of the United States. So there is no excuse. And, hopefully, there is a judge that will expedite this. But it's

not a surprise. This administration and this president have done everything they can to stop the public from actually knowing exactly who owns him, who does he owe, and what is -- how is that affecting his decision-making process in the White House.

BLITZER: Well, we will see what happens, because it could be a court battle that could go on for a while.

Let's get to the latest on Michael Flynn, the fired president's former national security adviser. These new details that are emerging right now, how does that influence your view of obstruction?

GALLEGO: Well, certainly, I would like to know who is this person that was contacting Michael Flynn, encouraging them to obstruct.

If that person was taking orders from the White House, the president or anybody close to the president, that really does matter.

It also just shows you again what kind of characters were surrounding this president, whether it's Manafort or Flynn, that he just could not see in front of him, even though he had been warned multiple times, that these were some very shady characters that had a lot of corrupt influences from Russia.

BLITZER: The only thing we know for sure is what was released in that unredacted portion of the document, citing someone associated with either the Trump administration or Congress.

If it's a member of Congress, that would be very significant.

GALLEGO: Well, if it's a member of Congress, he or she should resign immediately, because they are abdicating their duty over oversight.

They're partaking in obstruction of justice. And they'd had zero credibility in Congress.

BLITZER: Witness tampering, would you suspect that could be a problem?

GALLEGO: I would imagine so.

And I think this is why, if it's a member of Congress, Mueller did not get involved in actually filing any charges because I think that's going into some very legal gray areas.

But at least for the sake of Congress, I would hope that this member of Congress would realize that they are basically useless to their constituents at this point.

BLITZER: Do you want your Democratic colleagues in the House, the leadership, to invite Michael Flynn to come testify before a committee?

GALLEGO: I think Michael Flynn and anyone else I think that can really shed light on what was occurring in terms of obstruction of justice would be very greatly appreciated.

And I think that that probably will be happening in the future.

BLITZER: The attorney general, including as recently as today, Bill Barr, he keeps saying he doesn't have a problem with Robert Mueller going before Congress and testifying.

So why hasn't a date been set for Mueller to come and appear before Congress?

GALLEGO: Well, I think partly the attorney general's not being entirely clear. He can say that, but he needs to actually green-light it and make sure that Mueller has all the authorities to actually speak freely at these hearings.

BLITZER: He keeps saying, I don't have a problem. If he wants to go, let him go.

GALLEGO: Yes, this is not...

(CROSSTALK)

BLITZER: The president has a different view, but...

GALLEGO: Yes.

This is not exactly an attorney general we should be trusting. He has a history, basically, of trying to stonewall, whether the Iran-Contra affair, what we have seen right now.

If he truly believes that, he should let Mueller come to testify with also all clearances to be able to talk about all aspects of the investigation.

BLITZER: You think we're going to eventually hear Mueller come before -- before a congressional committee?

GALLEGO: I do think so. I think it may take a little while.

But I do think we're going to be able to get all the information and truly find out what happened during this investigation.

BLITZER: What do you think of the attorney general, Bill Barr's decision to get the U.S. attorney in Connecticut to launch a full- scale investigation into the origins of the Russia probe?

GALLEGO: Well, number one, I think it's a very dangerous precedent, where we're actually weaponizing the Department of Justice to fulfill the wants of a president who is living in fantasyland and conspiracy land.

The fact that he's sending it to a U.S. attorney that's known for being at least thorough and long is also showing that -- hopefully, that this attorney general is just trying to appease this president.

But it's still a very dangerous precedent. The Department of Justice works for the U.S. citizenry, not for the presidency.

BLITZER: You're from Arizona, a state that borders of Mexico.

There are these reports now that the president wants this new border wall to be painted black with spikes on top, black in the summertime, to make it even hotter, more dangerous for individuals to try to cross into the United States.

What do you think of that?

GALLEGO: I mean, look, I think the president is not really well-known for being that good about construction or property siting.

[18:15:01]

More importantly, it doesn't solve our problem. The problem we have right now are people are legally going to ports of entries and asking for refugee status.

You're still going to have that, whether you put up a black wall, a green wall, you put moat, and you put alligators around it. It doesn't matter. The president is actually trying to just fulfill a campaign promise, when the actual problem is our refugee crisis that we have.

And there are actual solid ways to do that and fix with -- that.

BLITZER: Comprehensive immigration reform would be good.

GALLEGO: Yes.

BLITZER: If you guys in Congress could get your act together and pass something.

GALLEGO: If we had Republican colleagues that would actually help us do it, that would be great. But we don't.

All we have are people that really obstruct that process.

BLITZER: Congressman Gallego, thanks for coming in.

GALLEGO: Thank you, Wolf.

BLITZER: Just ahead: President Trump says he was not warned about his one-time National Security Adviser Michael Flynn. But what about that Oval Office warning from President Obama?

(COMMERCIAL BREAK)

[18:20:22]

BLITZER: Tonight, President Trump has been misleading and venting, as Americans digest the newest revelations about Robert Mueller's investigation.

The fired National Security Adviser Michael Flynn back on the president's radar, after court documents revealed Flynn gave Mueller potential, potential evidence of obstruction.

Let's bring in our analysts.

Evan Perez, let me read the transcript of the voice-mail that Michael Flynn provided to the Mueller team. This is the president's personal counsel, we're told, making -- leaving this voice-mail for the lawyer for Michael Flynn.

"It wouldn't surprise me if you have gone on to make a deal with the government. If there's information that implicates the president, then we have got a national security issue. So, you know, we need some kind of heads-up just for the sake of protecting all our interests, if we can. Remember what we have always said about the president and his feelings toward Flynn. And that still remains."

And now they -- they not only want us to read that, but the federal judge says we should hear the audio as well.

EVAN PEREZ, CNN JUSTICE CORRESPONDENT: Yes.

No, this is Judge Sullivan. And this is Judge Sullivan doing what he does best. I think he wants to hear more of this, to understand, again, before Michael Flynn is sentenced, exactly what was happening here, the context.

And I think one of the things that the audio could tell you is a little bit about the context of the conversation. Perhaps it tells you whether there was a previous conversation that happened.

Again, I think just hearing the tone, the way the message was left, I think, could tell you a little bit more about what the intention was.

Now, it's clear the Mueller investigators decided that they couldn't go to a place here. There's attorney-client privilege issues, that they couldn't bring any charges. But I think it's going to be very interesting for all of us to hear this.

BLITZER: Mark Preston, how are members of Congress, the Democratic leadership, going to try to figure out the names of the individual or individuals from the Trump administration or from Congress who are trying to influence Michael Flynn, according to Michael Flynn?

MARK PRESTON, CNN POLITICAL EDITOR: Right.

Well, the beauty of all this is, in the three co-equal branches of government, there's still another branch that can weigh in on this. And, of course, that's the courts. And we're going to see some of this stuff that has come out, right, including the transcript and some of the other information.

What this does, though -- and I think Evan brings up a really good point -- is that it's one thing to read something off a transcript. It's another thing to actually hear the tone of the voice, to hear if there's desperation or if there's anger, if there is kindness, if there's -- if there's anything there, because that is the color that's going to give you the sense of what exactly the lawyer was thinking at that time.

BLITZER: Jeffrey Toobin, Michael Flynn, the fired national security adviser, he also shed some light on how the Trump campaign viewed WikiLeaks during the campaign.

Democrats are seizing on that to make the case that they not only need to see all of the Mueller report, the completely unredacted version, but all of the underlying evidence that resulted in that report.

Tell us why that's so significant.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, all of this fits into one piece, which is the insinuations in the Mueller report that the Trump campaign was willing and able to coordinate with WikiLeaks, but never actually did it.

And, at the same time, the issue of obstruction of justice, the idea of keeping witnesses quiet, whether it was Michael Flynn, or Michael Cohen, or Paul Manafort, all of the evidence points in the same direction. It's not conclusive.

This message is not conclusive of obstruction of justice. But if you are serious about doing an investigation, you don't want to just take the Mueller team's word for it. You want to see the evidence itself. And that's what the -- that's what the Democrats in Congress are trying to do.

BLITZER: And, Kaitlan Collins, clearly, the president's now trying to distance himself from Michael Flynn. He tweeted today, why didn't people warn me about this guy?

(LAUGHTER)

KAITLAN COLLINS, CNN WHITE HOUSE CORRESPONDENT: Which is, A, wrong, because people did try to warn President Trump about Michael Flynn, and that included President Obama, Sally Yates, the former deputy attorney general, Chris Christie, who played a big part in the president's campaign.

So there were several people who did try to warn the president, this guy is not on the up and up.

But what's interesting about the president's tweet today saying, why didn't anyone tell me sooner, is that, actually, when the president found out about some of the things Michael Flynn had been doing, he took a long time before they did finally push him out of the White House. And that was only after it was becoming public that he had lied to the vice president, which is what they said at the time.

But also, with this voice-mail, you see that John Dowd, the president's attorney at the time, left for Michael Flynn's legal team, you see that, long after Mike Flynn left the White House, he was still someone who was involved in conversations there, a topic of conversation, attempts to reach out.

[18:25:01] So it showed that it's not like they just washed their hands of Mike Flynn when he left the West Wing.

BLITZER: He's awaiting sentencing. It'd be good to hear him testify before Congress.

Everybody, stick around. There's a lot more we're following, much more right after this.

(COMMERCIAL BREAK)

BLITZER: We're back with our analysts.

And, Jeffrey Toobin, the Attorney General, Bill Barr, he's all of a sudden giving some interviews, "The Wall Street Journal," FOX News.

I want to play for you an exchange he had with Bill Hemmer of FOX News earlier in the day, talking about all of this. Listen to this.

(BEGIN VIDEO CLIP)

BILL HEMMER, FOX NEWS AMERICA'S NEWSROOM: The President calls this a witch hunt. He calls it a hoax. Would you agree with that?

WILLIAM BARR, U.S. ATTORNEY GENERAL: Well, as I've said, if you were the President, I think you would view it as a witch hunt and a hoax because at that time, he was saying he was innocent and that he was being falsely accused.

HEMMER: Are you comfortable using those words, witch hunt, hoax?

BARR: I use what words I use and it was an investigation. But I think if I had been falsely accused, I'd be comfortable saying it was a witch hunt.

(END VIDEO CLIP)

BLITZER: All right. Jeffrey, what do you think?

TOOBIN: I was amazed by that interview and the one in The Wall Street Journal. It turns out the Attorney General is Sean Hannity and Sean Hannity is the Attorney General. I mean, every talking point from Fox News gets repeated. He has no problem with calling the FBI, which works for him, a hoax and a witch hunt and Donald Trump cooperated fully even though he didn't talk to the investigation. I mean, I just found it an absolutely astonishing couple of interviews.

BLITZER: What did you think, Mark Preston?

MARK PRESTON, CNN SENIOR POLITICAL ANALYST: I mean, look, it's really hard to top what Jeffrey just said right there, especially when you look at the Attorney General. And he's the one going out there saying, I'm the impartial one, I'm going to be the person who is going to oversee this investigation into Hillary Clinton and we're going to go back there because we think that's so important. At the same time, he just wants to dismiss what's right in front of

us. I mean, it's clear that he is not playing an even hand right there, and it is quite apparent.

PEREZ: Look, I think people who know Bill Barr, nobody really believes that he is going to rig whatever this outcome is for Donald trump. I do think that what you're hearing from him is skepticism that he had before he became Attorney General, which he apparently still has.

Now, look, by this time, this is an Attorney General who could have been briefed on everything. I mean, I'm a little befuddled as to why he doesn't have all the answers already, because, I mean, he could have had somebody bring him everything and take a weekend or two weeks or whatever to read everything about what this investigation, how it began.

And so I think some of the things that he's using, the words he's using, I wonder what's the -- there must be something else at play here. Is he trying to perhaps bank some points with the President? This is a president who is very transactional. Is he trying to put himself in a place, so that in the future, when he has bad news for the President, he's in a better place for that? I'm not sure, but I'm not ready to jump to those conclusions just yet.

BLITZER: Kaitlan, clearly, the President is loving what he's hearing from the Attorney General, especially his decision to launch a brand new investigation into the origins of the Russia probe.

COLLINS: Yes. The President and his allies wanted their own Special Counsel to look at that. Bill Barr didn't go that far. He just signed a U.S. attorney to look at it, so it's not the same. They don't have the same level of independence that the Special Counsel did. But he is following essentially what the President wants.

The question here is Bill Barr has said, even though he's making comments like that, that it's okay if he calls it a witch hunt because he says the President was falsely accused. But the thing is he is couching other language and he is being more hesitant, saying, I don't know that there was bias but I have a lot more questions than I have answers and I want to find out the answers.

If you look at the President's Twitter feed, the President is already pre-judging the outcome of this investigation and believes, yes, they were biased for me.

So the question for Bill Barr is going to be if he does get to the end of this and the FBI did act appropriately, then what is he going to say to the President?

BLITZER: Even without an investigation, Jeffrey Toobin, the President has concluded the result. My campaign for president, he Tweeted, was conclusively spied on. Nothing like this has ever happened in American politics, a really bad situation. Treason means long jail sentences and this was treason. TOOBIN: Treason, a crime that, under American law, is punishable by the death penalty. So, I mean, just keep that in mind. I mean, we are so far from how presidents have traditionally behaved in this country. He's the Head of the Justice Department, which is the head of the FBI, and he is calling the leadership of the FBI, James Comey, Andrew McCabe, all these people, he's calling them treasonous. This has not -- Richard Nixon didn't call his enemies in the government, much less, with these kind of accusations. I mean, it's just Tweets and we're certainly used to it by now. But I think we need to maintain the capacity to be outraged.

PRESTON: You know, the mere simple actions that he decided to interpret the Mueller report and present it to Congress in a way that really did confuse us for many weeks, A, and B --

PEREZ: It was misleading. I mean, --

PRESTON: -- misleading, and then deciding to go and say, look, we are going to look into Hillary Clinton and we're going to see if there was some problems with that and we're also going to be looking to see if this was politically motivated. I don't think anybody has a problem to looking into the federal government to make sure that our folks, that our law enforcement folks are not doing stuff for politically partisan purposes.

[18:35:05]

But the fact of the matter is, what he's doing right now is creating a big smoke screen and trying to create more chaos and confusion.

PEREZ: I think the Attorney General is not doing any favors for himself with some of the language. And I think he could be doing all of these things without saying some of these words, using the words, no conclusion, repeatedly in his press conference. I think without those things, and he could be accomplishing the exact same things without using those words, I think, without a doubt, that's part of the issue here.

COLLINS: And that's what the White House is sticking by. They're saying, this is not someone who had a personal relationship, like Jeff Sessions did with the President before he became Attorney General. So he's not to going to jump in front a train for the president and put his reputation on the line.

But then when you look at that and then what he's saying, you know, I'm fine with calling this a witch hunt, that's where he creates problems for himself with democrats on Capitol Hill who it helps further their talking point that he's just doing what the President wants.

BLITZER: A significant development. Everybody stand by. There's a lot more news we need to cover, including Joe Biden. He's preempting President Trump as he makes a big play for a state that secured President Trump's 2016 victory.

(COMMERCIAL BREAK) [18:40:00]

BLITZER: Tonight, Joe Biden is driving home the importance of Pennsylvania to the democrats' hope of retaking the White House. Let's go to our Political Reporter, Arlette Saenz. He's on the seat for us in Philadelphia, where the former Vice President is about to hold the first major rally of his 2020 campaign.

ARLETTE SAENZ, CNN POLITICAL REPORTER: That's right, Wolf. Joe Biden has been a presidential candidate for three weeks now and he's about to enter a new phase of this campaign starting tomorrow with this official kickoff rally here in Philadelphia. Biden has been traveling across the country over the past three weeks starting with his first event in Pittsburgh, also here in Pennsylvania, a state they are trying to place a lot of emphasis on in his campaign.

And tomorrow here, he will be talking about his vision for unity in the country. And pretty soon, after that, he's -- next week, he's going to start hitting other states, holding fundraisers in Tennessee and Florida and also heading down to Texas by the end of the month.

And, Wolf, we're going to start hearing about policy rollouts from the former Vice President. Biden himself has promised a climate change speech by the month.

BLITZER: You know, it's interesting, Arlette, because a big part of President Trump's on election night was he managed to turn Pennsylvania red for the first time since 1988. In fact, President Trump is now heading back to Pennsylvania on Monday, right?

SAENZ: Yes, that's right. Joe Biden will be here in Philadelphia. And then on Monday, President Trump will be a little bit more in the northwest part of the state bringing his own pitch here to Pennsylvania. As you mentioned, this was a state that was critical to his victory, one that democrats lost to Donald Trump back in 2016, but it's also a state where Joe Biden sees an opening.

And earlier this week, there was a poll here that found that in a head-to-head matchup, Biden would beat President Trump 53 to 42 percent. So that's something that Biden and his team are really going to be focusing on, placing a lot of emphasis here in the state.

Biden was born in Scranton, Pennsylvania. He served next door in Delaware. For 36 years. And he believes that he can appeal to some of those working class voters in the state, who voted for President Trump time around. And you've seen Biden framing this as an election in a showdown between him and the President. That is going to continue for several months going forward. Wolf?

BLITZER: Clearly, the democrats will want somebody who can carry Pennsylvania or Michigan or Wisconsin, Florida, Ohio, states that Trump clearly won last time around. Arlette, thanks very much.

Just ahead, the Trump family business under investigation.

(COMMERCIAL BREAK) [18:48:05] BLITZER: We're following breaking news on the Trump administration's new defiance of a subpoena from the president's tax returns. Tonight, CNN is conducting its own investigation of the Trump family business, including how the president managed the make money even in deals that fell apart or went bankrupt. Take a look.

(BEGIN VIDEOTAPE)

ERIN BURNETT, CNN CORRESPONDENT (voice-over): The failure of Trump Ocean Resort Baja, Mexico, was among several Trump buildings that failed in the early 2000s. Two projects planned for Florida also failed. The Trump SoHo Hotel went bankrupt, so did buildings in Panama and Toronto.

UNIDENTIFIED MALE: Most people in the city when that tower went bankrupt sort of just chalked it to the global financial crisis. But a lot of people were building condos during the global financial crisis, and none of them went bankrupt.

BURNETT: Marco Chown Oved and Robert Cribb of "The Toronto Starr" partnered with Columbia's journalism school to investigate what happened at the Trump building in Toronto.

UNIDENTIFIED MALE: Every one lost money except for Trump.

BURNETT: It's the bottom line again and again. He gained, others lost. Take Panama.

How much did he make?

UNIDENTIFIED FEMALE: He made probably between $30 million and $55 million even though it's a project that went bankrupt, remember.

BURNETT: Everybody else lost and Trump earned $30 million to $50 million. How?

A big part of the answer, licensing.

UNIDENTIFIED MALE: The way it works is somebody else decides to build a building, so they say, all right, Trump, we'll pay you a fee to put your name on it.

BURNETT: Those Trump buildings in Panama, Toronto, SoHo, and Baja, Mexico, all licensed properties.

UNIDENTIFIED MALE: Donald Trump started licensing his name because it was easy money. Here was an opportunity to sign your name and get paid in front.

(END VIDEOTAPE)

BLITZER: CNN's Erin Burnett is joining us right now.

Erin, it looks really amazing.

[18:50:01] Tell us a little bit more about your special report. BURNETT: I mean, Wolf, you know what was incredible what we found is just in property after property, right, it was licensing. That was the model. And the business was set up so no matter what happened, as you saw in case after case, there was failures and bankruptcies. People bought in put down deposits. They lost money. Trump walked away with money.

You saw in the case of Panama alone, $30 million to $50 million. And, of course, the Panama building itself, that went bankrupt. So, that's what we saw.

When you hear Trump and licensing, you think, oh, maybe those ties at Macy's, right, or the Trump vodka. Sure, that was part of it. But it was buildings.

And what we found again and again, Wolf, was people didn't know. The people buying in thought they were buying into the Donald Trump they saw on television. They thought he was the developer. He often said he was the developer. You know what, Wolf, he was not.

BLITZER: One project you look at known was the Trump Ocean Resort Baja, Mexico, which doesn't currently exist. Tells us about that.

BURNETT: It doesn't exist. Right. What you saw there is all there is of it. That's nothing, literally a hole in the ground.

Sandra Sapal (ph), you heard her speaking there, and still chokes up about it. She said her American dream was a second home that was about an hour south of San Diego with her family. She saw this advertisement for the Trump Ocean Resort Baja, Mexico. They put in $125,000 down payment, Wolf, and they lost every penny. They couldn't afford to the join the class action lawsuit which Trump ended up settling.

So, they were out the $125,000. And it's a pretty incredible story because that was never built. Hole in the ground and yet Ivanka Trump appeared at a presentation where Sandra Sapal (ph) appear her husband were. And Ivanka Trump said, Wolf, gosh, might have to sugar from you one time, you know, so I might have to knock on your door.

That was how the Trumps portrayed their involvement and commitment to these building. In the brochure, it said Trump was the developer, he was not.

BLITZER: We'll learn a lot later tonight.

Erin Burnett, thank you very much.

BURNETT: Thanks, Wolf.

BLITZER: And to our viewers, be sure to watch Erin's special report on the Trump family business. It airs later tonight, 9:00 p.m. Eastern, only here on CNN.

Just ahead, U.S. pork farmers are having a very difficult time bringing home the bacon as the president's trade war with China intensifies.

(COMMERCIAL BREAK)

[18:56:52] BLITZER: Tonight, President Trump's trade war with China is hurting Americans in the heartland. Pork farmers are among the hardest hit.

CNN's Martin Savidge is in Iowa for us asking them about how they're coping.

(BEGIN VIDEOTAPE)

MARTIN SAVIDGE, CNN NATIONAL CORRESPONDENT: Mike Paustian rushes to plant corn before the next round of rain. He needs it for the mouths he and his wife have to feed.

So, these are your babies?

AMY PAUSTIAN, IOWA PORK FARMER: The babies. Ye, they grow rapidly.

SAVIDGE: Six hundred pigs are born on this farm every week. And every year, the Paustian takes 28,000 to market. A market now full of uncertainty with the trade war with China.

MIKE PAUSTIAN, IOWA PORK FARMER : Prices used to not change very much, and now, they seem to fluctuate a lot.

SAVIDGE: China has been a growing market for U.S. farmers. But when the trade war broke out last year, U.S. pork was one of the first casualties. China adds more than 60 tax to the imported American pork effectively cutting off U.S. suppliers, enforcing changes on the farm.

PAUSTIAN: You maybe fix things instead of buying new things. And you maybe put off some purchases or you know remodeling of barns and stuff like that.

SAVIDGE: Can I ask you who you voted for?

PAUSTIAN: In the last election, I voted for Trump.

SAVIDGE: Like many farmers, Paustian feels a new trade deal with China is needed but he is not sure that tariffs are the way to go.

PAUSTIAN: I would say that maybe it wasn't the best way to approach it. But, you know, it's kind of a guessing game at this point.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Fifteen billion dollars.

SAVIDGE: He is also not happy with the $15 billion relief Trump is promising farmers this year.

PAUSTIAN: That is a band-aid over a gaping wound. You know, what we really want is to just -- we want trade deals.

SAVIDGE: Though there is no end in sight to the trade war, there is a new and deadly player in the mix -- African swine fever.

This is very fatal and very contagious.

PAUSTIAN: Very fatal to pigs. Very contagious.

SAVIDGE: He would know, Paustian has a PhD in microbiology. The decease is reportedly decimating China's pig population which may force China to buy U.S. pork and because China is the world's largest consumer of pork could be a growing factor in overall trade negotiations.

PAUSTIAN: I would have to imagine it's -- it would put some pressure on them to get a deal, because let's face it everyone's lives would be easier for us and China if we could just work out a deal.

SAVIDGE: Without one, pork producers will spend more uncertain days, trying to decide which of these little fellows go to market and which ones stay home.

(END VIDEOTAPE)

SAVIDGE: China has put a lot of tariffs on many American products. But it began with agriculture which means, Wolf, farmers have been suffering the longest. And they would also say the hardest. And they very much want to see the trade war come to an end -- Wolf.

BLITZER: Yes, a real problem, especially as we say in the Heartland.

Martin Savidge in Iowa for us -- Martin, thanks very much.

And to our viewers, thanks very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM. You can follow me on Twitter and Instagram @WolfBlitzer. You can always tweet the show @CNNsitroom.

"ERIN BURNETT OUTFRONT" starts right now.

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