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Trump Storms out of Meeting with Democrats; Judge Upholds Subpoena of Trump Financial Records; Pelosi Doubles Down on "Cover- Up"; Interview with Rep. Ted Lieu (D-CA) on Trump's Refusal to Work with Democrats. Aired 5-6p ET

Aired May 22, 2019 - 17:00   ET

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


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WOLF BLITZER, CNN HOST: Happening now, breaking news: Trump loses again. A federal judge upholds congressional subpoenas requesting financial records from two banks where the president and his family members have done business. It's the second court setback in three days for the president.

How will he react?

My way or no highway: President Trump throws a tantrum, walking out of a meeting with Democrats on the country's infrastructure and says he can't work with them on rebuilding highways or bridges or on any legislation until they stop their investigations.

Pelosi's play: the president erupted after House Speaker Nancy Pelosi accused him of a cover-up.

Is she trying to distract Democrats who are pushing for impeachment?

And odd new ally: President Trump has a new campaign surrogate, Kim Jong-un, as the North Korean dictator goes after Democratic presidential candidate Joe Biden, taking a page right out of the president's playbook.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

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UNIDENTIFIED MALE (voice-over): This is CNN breaking news.

BLITZER: Breaking news: for the second time this week, a federal judge sides with Congress against the president. In the latest ruling, a judge in New York is upholding subpoenas to Deutsche Bank and Capital One for financial records tied to the president.

That comes as the president storms out of a meeting with Democratic congressional leaders and stages a hastily arranged rant in the Rose Garden next to a sign reading "No collusion, no obstruction." The president erupted after House Speaker Nancy Pelosi said he had

engaged in a cover-up. She spoke following a meeting of House Democrats, where she tried to discourage a push for impeachment. The president then went ahead with his meeting on infrastructure, with Pelosi and Senator Chuck Schumer.

But ended it after just five minutes or so, saying he can't work with Democrats on infrastructure or anything else until they end their investigations.

I'll speak with Congressman Ted lieu of the Judiciary Committee. And our correspondents and analysts, they will have full coverage of the day's top stories. First, details of the breaking news on subpoenas seeking more of President Trump's financial records. Kara Scannell is at the courthouse in New York.

Kara, this is the second major blow in court this week for the president.

What is the very latest?

KARA SCANNELL, CNN CORRESPONDENT: That's right, Wolf. It's the second setback for the president in just three days. Judge Edgardo Ramos going point by point through Trump Organization's arguments of why they shouldn't comply with the subpoenas sent by the congressional committees and he said that the subpoenas are valid, that Congress is -- particularly, the House Financial Services Committee and the House Intelligence Committee had a right to these documents, even though the subpoenas were very broad.

In fact, the judge said that the power of Congress to conduct investigations is inherent in its legislative process. That power is broad. So he is ruling unequivocally that the Congress has a right to the documents that the banks have, both Deutsche Bank and Capital One, banks that Donald Trump and his family members have done business with for years.

These subpoenas also apply to his family members, his companies. And all of that documentation is now valid for Congress.

He also said that he would deny their state pending appeal. That is, he would not put this decision aside, so that the Trump Organization and the president could appeal this case. Instead, he's saying that they really have no -- they're unlikely to succeed on the merits and, therefore, that they will not get this stay.

So -- to allow them time to appeal. He also said the scope of the investigation was also worthy, that Congress had the right to investigate whether there was foreign leverage, financial leverage over the president and whether his company was engaged in any money laundering.

So this is the second major setback, it's very clear now from two judges in two different districts that Congress has the right to access the president, his family members and his company's financial accounts -- Wolf. BLITZER: How quickly do you think they'll be released?

SCANNELL: Well, under an agreement that they had before today's ruling, there are seven days; also, like we saw in the case of the accounting firm, where they can have this. Now in the accounting firm case that was decided on Monday, the Trump Organization and the president said they would appeal and they notified the court of that in D.C.

Now the judge asked the lawyer for the president if -- what he was going to do in this matter and he said that he would consult with his client. So he is not yet announced that they're going to appeal this decision but it could go into effect within seven days -- Wolf.

BLITZER: Two federal judges, one in Washington, one in New York --

[17:05:00]

BLITZER: -- ruling against the president. Kara, stand by. I want to bring in CNN's chief legal analyst, Jeffrey Toobin.

Jeffrey, how big of a win is this, the one today for House Democrats?

JEFFREY TOOBIN, CNN SR. LEGAL ANALYST: Well, it's another very important win, because the legal issue fundamentally is the same as the one yesterday regarding the accounting firm that did the president's taxes.

The issue is, is this a legitimate subject for congressional oversight?

Does Congress have the right to investigate this area?

The president's lawyers have argued in both courts that this is a purely personal matter. It is not related to any sort of legislation, so Congress should not be allowed to get those documents.

That argument has now been convincingly rejected twice. And that, I think, is among the weakest of arguments that his lawyers will be raising. It's certainly a weaker argument than the Don McGahn executive privilege argument, which is upcoming. But this one is one that looks doomed, doomed in D.C., doomed today here in Manhattan.

And we'll see if he does any better in the appeals court.

BLITZER: How quickly could it make it to an appeals court?

And could this potentially, eventually wind up in the U.S. Supreme Court?

TOOBIN: What makes these two cases so perilous for the president is that he is not in control of the people who have the documents, his accountants and these banks. They are going to turn over this material because they don't want to be held in contempt.

Unless the president's lawyers can get in the appeals court, the D.C. Circuit in Washington, the 2nd Circuit Court of Appeals here in New York, to issue a stay. This is going to be resolved. The stay issue, within seven days, as Kara said. So the documents could start to be turned over as early as next week.

BLITZER: I'm sure the president is not very happy about that. Jeffrey, I want you to stand by, as well. I want to go to our White House correspondent, Abby Phillip.

Abby, a lot of drama over where you are today. Take us through what happened.

ABBY PHILLIP, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, another White House meeting with Chuck and Nancy has ended with President Trump storming out and into the Rose Garden. What seems clear after all of the drama today is that talks of a bipartisan infrastructure deal are all but dead.

(BEGIN VIDEOTAPE)

TRUMP: So I came here to do a meeting on infrastructure with Democrats, not really thinking they wanted to do infrastructure or anything else, other than investigate.

PHILLIP (voice-over): President Trump today laying a Rose Garden ambush for congressional Democrats, blaming the breakdown in infrastructure talks on this broadside from House Speaker Nancy Pelosi an hour earlier.

REP. NANCY PELOSI (D-CA): We believe that the president of the United States is engaged in a cover-up, in a cover-up.

PHILLIP (voice-over): Sources tell CNN that Trump erupted over Pelosi's comments this morning but kept the meeting on the schedule only to walk out after less than five minutes and without shaking a single hand.

TRUMP: And instead of walking in happily into a meeting, I walk in to look at people that had just said that I was doing a cover-up. I don't do cover-ups.

PHILLIP (voice-over): Trump now issuing an ultimatum: end congressional investigations or no legislation will get done.

TRUMP: I told Senator Schumer, Speaker Pelosi, I want to do infrastructure. But you know what, you can't do it under these circumstances. So get these phony investigations over with.

PHILLIP (voice-over): Sources say Trump was prepared to go forward with discussions on infrastructure until Pelosi's comments this morning. But Democrats say Trump carefully staged the walkout around this excuse for a clear reason.

SEN. CHUCK SCHUMER (D-NY): Hello, there were investigations going on three weeks ago when we met. And he still met with us. But now that he was forced to actually say how he'd pay for it, he had to run away. And he came up with this pre-planned excuse. PHILLIP (voice-over): For weeks, White House aides, including acting chief of staff Mick Mulvaney, had downplayed the prospects of an infrastructure deal with Democrats.

MICK MULVANEY, ACTING WHITE HOUSE CHIEF OF STAFF: I think it's a much better chance of getting USMCA passed than there is of getting an infrastructure deal passed.

PHILLIP (voice-over): And the White House sent this letter to Pelosi and Senate minority leader Chuck Schumer last night, saying they wanted trade, not infrastructure, to be their top priority.

White House aides denying the Rose Garden event was planned and insisting they rushed to put the event together this morning, even printing these signs with the president's favorite talking points about the Mueller investigation.

TRUMP: It's a disgrace.

PHILLIP (voice-over): The spectacle leaving Democrats in a state of shock.

SCHUMER: To watch what happened in the White House would make your jaw drop.

PELOSI: It was very, very, very strange.

PHILLIP (voice-over): Trump's anger building over what he called the i-word, impeachment.

TRUMP: All of a sudden I hear last night, they're going to have a meeting right before --

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TRUMP: -- this meeting to talk about the i-word. The i-word. Can you imagine?

PHILLIP (voice-over): As Congress raises the pressure on Trump and his associates, issuing new subpoenas to one of Trump's longest serving aides, Hope Hicks, and Annie Donaldson, the chief of staff to former White House counsel Don McGahn.

Her detailed notes playing a key role throughout Mueller's report. Tonight, Pelosi is issuing a clear warning to Trump, that obstructing investigations could lead to impeachment.

PELOSI: This is why I think the president was so steamed off this morning, because the fact is, in plain sight, in the public domain, this president is obstructing justice and he's engaged in a cover-up. And that could be an impeachable offense.

(END VIDEOTAPE)

PHILLIP: And President Trump is saying he can't work with Democrats until they stop investigating him. But there are some other major agenda items that are coming up for the Congress that the president is going to need Democratic votes for, including the U.S. -Mexico-Canada trade deal and also some important and non-negotiable budget decisions -- Wolf.

BLITZER: Keep the government operating. All right, Abby. Thank you very much. Let's bring in our senior congressional correspondent, Manu Raju.

Manu, so do Democrats believe they were set up?

MANU RAJU, CNN SENIOR POLITICAL CORRESPONDENT: No question about it, Wolf. They believe that the White House, the president used this comment that the Speaker made as an excuse to scuttle this meeting because the two sides were still at odds on doing anything on infrastructure.

The White House did not have a detailed plan in place; the Democrats and the White House were at odds on exactly how to pay for an infrastructure project. And the Democrats believe that this was all an effort to undercut that, what would ultimately be a futile bipartisan effort.

Now at the same time, Nancy Pelosi had been behind the scenes, making those comments about a potential cover-up for days. She made the comment on Friday and Monday night with other Democrats, saying, this could be a message going forward to talk about how, in their view, that there was a cover-up that occurred by this White House, by this president.

This is something they have been saying behind the scenes. We've heard the Speaker say it more bluntly today but, nevertheless, not going much further in their messaging than in the past several weeks, where they've accused the president from obstruction and others in the caucus have accused him of committing crimes.

So the Democrats ultimately believe this is all an effort to kill what could be one bipartisan accomplishment, even though the two sides were at odds over that key issue.

BLITZER: Will the president's behavior today, Manu, including storming out of the meeting, move the Democratic Party closer to an impeachment?

RAJU: At the moment, Wolf, no, because Democrats believe that -- most of them are in line with where Nancy Pelosi is, which is to investigate, to allow the courts to continue doing what they're doing.

They are buoyed by the ruling that happened just this afternoon, in which the Democrats won in trying to enforce their subpoenas for financial records, the second ruling that they were successful in this week.

Nancy Pelosi in a closed-door meeting today made that case, along with some key Democratic chairmen saying, we are winning. We don't need to launch an impeachment inquiry if we're already getting this information. And that's prompted some criticism from people who believe that there

should be an impeachment inquiry, including one Republican congressman, Justin Amash, who's the lone Republican to actually embrace the idea that the president should be impeached, who today, I talked to him, he criticized the president's behavior today but he also criticized the Speaker.

(BEGIN VIDEO CLIP)

RAJU: What's the reaction of the president today, telling the Speaker that he would -- that they should drop all of their investigations before even agreeing to legislate?

REP. JUSTIN AMASH (R-MI): I think that's irresponsible but, you know, that's what you would expect.

RAJU: Are you disappointed that the Speaker does not want to launch an impeachment inquiry?

AMASH: I think the Speaker is talking out of both sides a little bit, so...

(END VIDEO CLIP)

RAJU: So the reason why that Amash said that was because of Pelosi's comments, throwing cold water on moving forward with impeachment but also saying that the president may have committed impeachable offenses, in a sense, splitting hairs but also not moving forward with an investigation.

That's what the critics are saying. And an example of that is from this afternoon. Nancy Pelosi, when she sat down with the Center for American Progress, was asked whether or not she would get behind what a lot of Democrats were pushing for, which was to open up an impeachment inquiry, not necessarily voting on articles of impeachment but getting behind at least a formal investigation and she said this.

(BEGIN VIDEO CLIP)

PELOSI: I'm not sure that we get any more information by instituting an impeachment inquiry. But if we thought that we would, that's a judgment that we would have to make.

(END VIDEO CLIP)

[17:15:00]

RAJU: So not getting behind that idea at the moment, even though there are a growing number of members who do believe at least there should be some sort of formal investigation.

Now what Pelosi is arguing here is that the investigations are essentially doing the same thing as a formal impeachment inquiry. There's really no need to do something separate at the moment.

And in today's morning meeting, I'm told that really only a couple of members made that case along with Nancy Pelosi. That includes David Cicilline, the Judiciary Committee member, as well as Jared Huffman, another congressman, who said that we should be getting behind an impeachment inquiry.

One person went a little bit further, I'm told, at this meeting, Alexandria Ocasio-Cortez, the outspoken freshman liberal congresswoman, who said, we should impeach the president, put pressure on the Senate to act.

But decidedly, I am told, at that meeting, they were in the minority. Roughly seven or so other members spoke up. They called for getting behind Pelosi's more methodical approach, not embracing impeachment at the moment.

And six Democratic chairman also laid out their plans to investigate. And only one suggested we should move forward with impeachment, that's Maxine Waters, the California Democrat, who's been an outspoken supporter of impeachment.

So right now Pelosi believes her caucus is mostly on her side. They believe her strategy, going through the courts, getting information, is working. Going the route of impeachment is not necessarily where to go at the moment and that has, at least at the moment, they feel like they've got their caucus at bay. We'll see if that changes if the White House continues to defy their subpoenas -- Wolf.

Any reaction yet from Speaker Pelosi to this second win for congressional Democrats over the president, this latest court ruling at a U.S. federal court in New York?

RAJU: Nancy Pelosi just came out of House votes. She told reporters she's very excited about this ruling. She said that there were two in one week. She declined to answer other questions after today.

We do expect a longer statement from her in the aftermath of this. You've heard from other Democratic chairmen as well, including Elijah Cummings, the Oversight Committee chairman, who has that other lawsuit pending before a separate court that he won earlier this week, involving financial records with that firm, Mazars.

He won that case and he believes that their ruling in that case, favorable ruling, helped in this case as well. They're very confident that in other instances that could go to court, they're going to win in those matters.

But Wolf, some people who believe that the party should go forward -- go more further, including Brad Sherman of California, someone who supports impeachment, just told me moments ago, that's not going to stop his push for impeachment, just the win of a court victory, that's not enough, because he said the Supreme Court could ultimately rule the other way.

BLITZER: Important point. Thanks very much, Manu Raju up on Capitol Hill.

Joining us now, Democratic congressman Ted Lieu of California. He's a member of the Judiciary and Foreign Affairs Committees.

Congressman, thanks so much for joining us. Let me get your quick reaction to the breaking news. A federal judge in New York has now sided with Democrats in Congress, refusing to block subpoenas for President Trump's financial records.

Does this ruling support Speaker Pelosi's argument that the president is engaging in a cover-up?

REP. TED LIEU (D-CA): Absolutely. The Trump administration is covering up information and hiding information from Congress and the American people. And it's not just with records related to Donald Trump.

We also want to know why is the Trump administration suing to eliminate health care coverage for people with preexisting conditions? We've been stonewalled on that information. And so to have courts agree with Congress that the administration is covering up records, that's really huge for Congress.

And if Bill Barr is not careful, he's going to dramatically weaken the presidency by having a lot of really bad court rulings go against the president.

BLITZER: This is the second federal judge in three days to rule in favor of House Democrats.

Does that give you confidence that your party's oversight efforts are on the right track?

LIEU: It does. We have amazing House counsel and we have been giving reasonable accommodations to the Trump administration, bending over backwards to work with the administration. And they have engaged in maximum obstruction. And that is unprecedented and it's also unconstitutional.

The framers gave three branches and each is a check on the other and never has a president in American history simply stonewalled every single subpoena request.

BLITZER: After that very brief three- or four- or five-minute meeting with the Democratic leadership, the president went into the Rose Garden and said he's not going to work with Democrats on any legislation until these congressional investigations are dropped.

Do you believe that ultimatum will move more Democrats toward the idea of opening formal impeachment procedures against the president?

LIEU: It could. But what it really shows is that the president is a petulant child. And that has serious consequences. Democrats have passed legislation to reduce health care prices. We are working on a big infrastructure bill.

[17:20:00]

LIEU: And if the president doesn't want to do this, then he's putting himself and his family over the country. And that is unfortunate. Democrats will keep pushing to try to get infrastructure and health care done.

But the president is simply going to stonewall everything because we're conducting oversight, that's unconstitutional and unprecedented.

BLITZER: We know where you stand on impeachment. You support it.

What will it take to get a majority of the Democratic caucus to agree with you?

LIEU: So, Wolf, let me just be very clear. Democrats are not saying impeachment. What I'm saying and what some others are saying is an impeachment inquiry, which is we have to start these investigations to see if we should do impeachment. Those are very different issues.

I think that if Donald Trump continues to cover up and hide information from the American people, it certainly calls for more investigation, because, really, what is he hiding?

What is he hiding from the people?

BLITZER: So just to be precise, Congressman, if I understand what you're saying, you're in favor of beginning impeachment procedures in the House Judiciary Committee but you're not ready to say you will support impeaching the president?

LIEU: That is correct. Because we need to build a record in these committees. Right now we have interesting things people have said on TV, interesting articles in newspapers. We have a redacted Mueller report. What we need is the full Mueller report, the underlying evidence, so we can look at all of the obstruction of justice cases that Mueller has laid out in his report, from which he has said there is substantial evidence.

And we'll proceed and build this record and then we can decide whether to impeachment or not.

BLITZER: Have you personally been lobbying some of your fellow Democrats, Congressman, who may be on the fence, who aren't yet where you are?

LIEU: So the caucus had a good discussion today. And I have been talking to other Democrats. And we're having discussions as to how do we deal with a president that does not want to move the American family forward, does not want to work with us on health care or prescription drug prices and infrastructure and who is obstructing everything Congress is doing.

So we're having those conversations. And we will continue to have those conversations. And we'll continue winning in court as well.

BLITZER: Congressman Ted Lieu of California, thanks so much for joining us.

LIEU: Thank you, Wolf. BLITZER: Let's dig deeper into all of this. Our correspondents and our analysts are here.

And, Gloria, the president walked out of this very brief meeting only a few minutes with the Democratic leaders. He says he won't work with them on anything right now until they stop all their investigations up on Capitol Hill. You have a new column on cnn.com. Let me read from your column, your analysis of Nancy Pelosi's strategy.

"Democratic congressional efforts at oversight should continue but without a rush to impeach. Speaker Pelosi can't and won't corral her caucus to her point of view but she won't lead them off a cliff, either."

Tell us more about that, about this delicate balance --

(CROSSTALK)

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: She's under a great deal of pressure right now, quite frankly, because the president, this morning in the Rose Garden, was petulant, threw a temper tantrum, stormed off, wouldn't meet with them. And of course, her Democrats who are leaning towards impeachment, probably looked at this and said, how can we put up with this any longer?

We're just trying to do our job, we're just trying to do oversight.

But she's got a tough job here. Don't forget, Nancy Pelosi was Speaker -- I mean, was not Speaker but was in Congress when the Republicans in 1998 impeached Bill Clinton. And she knows the history there. And she knows that Bill Clinton's popularity went up. She knows the dangers for her Democrats.

She knows she has 15 Democrats in the House who won in Trump districts. She wants to keep control of the House. And as one Democrat said to me this week, if you're worried about the Constitution, this Democrat said, re-electing Donald Trump is the worst thing that could happen to the Constitution.

So that's the argument this Democrat is making to others.

BLITZER: Nia, she went further today than she had in the past, saying the president of the United States had engaged in a cover-up.

NIA-MALIKA HENDERSON, CNN CORRESPONDENT: And this was right before she was going to go off to this meeting. She had meetings with her caucus. She had said something similar before in writing but never said it on camera.

So this apparently really ticked the president off. He sort of flew into a bit of a rage and we saw that temper tantrum in the Rose Garden.

She has this unique quality of getting under the president's skin in a way that we haven't seen anybody able to do that. We saw that on display before, with the Oval Office meeting about the wall and saw him not really be able to deal with her and not be able to deal with her successfully.

And she has been a master at that, a master at playing him. It's unclear whether or not she sort of did this on purpose and knew that she would be able to goad him into this display in the White House. They clearly were prepared for it and they had those signs already.

But now in some ways she is saying that he is engaging in this cover- up and the courts are in some way agreeing with her saying, yes, they are --

[17:25:00]

HENDERSON: -- trying to hide these documents from Congress and Congress has the legal right and the legal role to oversight.

BLITZER: You know, Sabrina, at least 29 Democrats, probably more, but at least 29 -- and we have a graphic showing who they are -- have already indicated that they are willing to pursue impeachment, to start the impeachment procedure in the House of Representatives.

The latest tantrum from the president, do you think that will encourage more Democrats to follow their position?

SABRINA SIDDIQUI, CNN POLITICAL ANALYST: Well, it certainly reinforces that it's highly unlikely that the president is going to work with Democrats in Congress on any major piece of legislation and the prospects of a deal on infrastructure, on immigration, on anything are close to none.

I think when you look at the momentum for impeachment, perhaps it got a little bit more support from Justin Amash, becoming the lone Republican to also suggest that the president's conduct amounted to impeachable offenses.

But the calculation for Nancy Pelosi hasn't changed, that even if House Democrats did vote to impeach the president, they would not win a conviction in a Republican-controlled Senate.

But I think what you're seeing now is a great deal of frustration with the complete stonewalling on the part of the White House, on all of these investigative efforts by Democrats.

So some of them are starting to say, there's only so much we're going to get from a contempt resolution. That's largely symbolic. The process in courts could take a really long time to play out. Maybe the real way to respond to the administration is to begin impeachment proceedings and get some of those documents they want.

BLITZER: Jeffrey, I want you to stand by. Everybody, stand by. We're going to discuss a second major federal court decision today, ruling against the president, in favor of congressional Democrats. Much more on that right after this.

(COMMERCIAL BREAK)

[17:31:32] WOLF BLITZER, CNN ANCHOR: We're following multiple breaking stories, including a federal judge in New York upholding subpoenas to Deutsche Bank and Capital One for financial records tied to President Trump.

And, Jeffrey Toobin, this is a significant decision in favor of the congressional Democrats, a second loss in a district court for the President in three days. This is a major moment.

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: And even within the Democratic caucus, this is a major victory for Nancy Pelosi because she is the one who has been saying, look, we don't need to do impeachment in order to do investigations. And here you have two important federal court decisions saying precisely that, that these documents need to be produced to the congressional committees even though there is no impeachment resolution underway.

If the Appeals Court were to reverse either or both of these decisions, then I think Pelosi would be in a more difficult position with her members who want to say we need to go forward with impeachment. But as of now, her position looks stronger because she says, look, we can continue with these investigations, but we don't need to have an impeachment inquiry.

BLITZER: It's a big setback, Gloria, for the President.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Sure.

BLITZER: Remember, at one point, he had told "The New York Times," if you go after my personal financial records, that's crossing a red line.

BORGER: That's the red line. And, you know, he was saying that to Congress, but can you say that to the courts? I don't think he can say that to the courts. And let me agree with Jeffrey here that Nancy Pelosi can make the case, we're winning. We are winning.

You know, over half of the American public in a recent poll says they wouldn't vote to re-elect Donald Trump, and, you know, only 37 percent of them want impeachment. So she's not ready to go to impeachment ahead of the American public, but these things have to play themselves out.

Now, the more Donald Trump behaves like a child, as he did in the Rose Garden today, the more difficult that might become, but then the public might turn around a little bit. So she wants to give him enough string, and she wants to give the courts an opportunity to weigh in here.

BLITZER: And this is -- you agree this is a big win for congressional Democrats, especially Nancy Pelosi?

NIA-MALIKA HENDERSON, CNN SENIOR POLITICAL REPORTER: Yes. You know, it has been touch and go for the congressional Democrats for a while here. Unclear about what their strategy was, some incoherence there. And this caucus, the sort of impeachment caucus being very loud even though they're still in the minority. So I think, with these rulings, you heard Nancy Pelosi say she's very,

very excited about it. She's not surprised about it. So, yes, I think she's had certainly a good, good day. She, you know, was sort of taking a victory lap in some ways when she was at the presser after the -- in the Rose Garden after this cancellation of the infrastructure meeting.

Then she had another, you know, event where she talked again about the President and said that, you know, what happened at the White House was very, very strange. She also said that she was going to pray for the President, which, you know, in Southern speak is essentially saying, bless his heart.

(LAUGHTER)

HENDERSON: So, you know, it was full of, you know, shade for the President. And again, she can goad him. And I think Gloria is exactly right, give him the room to be Donald Trump.

Donald Trump certainly likes a fight. He likes a foil. And he also likes, you know, celebrating Festivus every single day, airing grievances. And, you know, he thinks it works for his base, but I think Nancy Pelosi has had a good day as well.

BLITZER: And, Sabrina, is it going to embolden congressional Democrats to go even tougher in terms of their oversight?

SABRINA SIDDIQUI, POLITICAL REPORTER, THE GUARDIAN: Well, it certainly robs the White House from being able to make the argument that Democrats in Congress are overreaching, which has essentially been their response to all of the requests that Democrats have made thus far.

[17:35:08] And this is now the second ruling to say that the President's finances, as you pointed out, his red line, are not, in fact, off-limits. I think that when you look back at that list in March of the 81 associates or entities connected to Trump that House Judiciary Democrats requested documents from, it was clear that they had every intention of investigating the President, his family, his business, you know, obviously, the conduct of his administration.

But I think they're still going to try and find that balance between legislating and investigating. But certainly, they can now say that they are on sound legal footing, barring, you know, a reversal of this opinion. And I really do think that you're going to see a lot of Democrats say that this is an appropriate oversight function of Congress, and the courts have, in fact, ruled in our favor.

BORGER: Can I just get back to what Trump did in the Rose Garden today? I mean, you covered Bill Clinton. You covered Bill Clinton during Monica Lewinsky, correct?

BLITZER: Mm-hmm.

BORGER: And even at the worst times for Bill Clinton, what did he say? He dismissed the Ken Starr investigation, and then he said, but I'm going to go back to work for the American people.

HENDERSON: Right.

BORGER: Do you remember that, I'm going to go back to work for the American people? What did Donald Trump do today?

He said, I don't like what you're doing. You accused me of a cover- up. I'm not a cover-up guy -- I thought of Stormy Daniels, but never mind --

(LAUGHTER)

BORGER: I'm not a --

HENDERSON: Right, me too.

BORGER: I'm not a cover-up guy. And by the way, I'm not going back to work for the American people, I'm going on strike. I am not going to do my job. And moreover, I'm not going to let you do your job. I don't know how that's going to be received.

BLITZER: Yes. I remember when I was the White House correspondent for CNN covering Bill Clinton at the height of impeachment.

BORGER: Yes. That's right.

BLITZER: And, Jeffrey Toobin, you'll remember this well. Even when Newt Gingrich, the Speaker, was leading the fight on the House floor against then-President Bill Clinton for impeachment, they were --

BORGER: Right.

BLITZER: At night, they'd have private meetings to balance the budget, to deal with all sorts of other fiscal issues on behalf of the American people, irrespective of that battle over impeachment.

TOOBIN: Welfare reform was a major legislative achievement. You can argue about whether it was a good thing or a bad thing, but it was something that was negotiated between Democrats and Republicans at precisely the time he was being -- the President was being investigated.

I mean, I think Gloria is exactly right. That phrase really stuck in my mind, when Bill Clinton said, all the time, I am going to keep working for the American people regardless of what's going on with these investigations. It was precisely the opposite of what Donald Trump said today.

Will the public make -- you know, make that distinction? Will the polls change? I doubt it, the polls never change. But it is certainly a major difference between how two presidents under investigation behave.

BLITZER: And, Nia, you mentioned a little sound bite from the Speaker Nancy Pelosi earlier, what she's thinking of the President. Let me play the clip. (BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE OF REPRESENTATIVES: In any event, I pray for the President of the United States, and I pray for the United States of America.

(END VIDEO CLIP)

HENDERSON: I mean, part of what she's trying to do there is to be presidential, right? You had the President in the Rose Garden, kind of a hallowed place, essentially saying that he wasn't going to do his job as president. He was abdicating his responsibility and not wanting to do that. But I also think, again, it was kind of Nancy Pelosi who is so excellent at shades, so excellent at poking this president.

At some point, she was saying, you know, we really want to give the President an opportunity to sort of have his Mount Rushmore moment, his historic moment, where he could be in the company of great presidents like Roosevelt, but, you know, he lacked the confidence to get it done. So, yes, I think we're going to see more of this, sort of the Chuck and Nancy show.

TOOBIN: Is that what she was saying?

(LAUGHTER)

TOOBIN: I thought what she was saying is this guy is bonkers, and I'm praying for him and I'm praying for the country.

(LAUGHTER)

TOOBIN: That's the shade I got.

HENDERSON: Well, it's not -- I mean, yes.

BORGER: I don't know.

HENDERSON: I mean, that's sort of what "bless your heart" means, right? It's sort of -- sort of pity.

BORGER: All I can say is it always happens during infrastructure week.

HENDERSON: Yes, yes, yes.

BORGER: Infrastructure week.

SIDDIQUI: Every week is infrastructure week.

HENDERSON: No more infrastructure weeks, please.

BLITZER: How are those roads and bridges coming along?

SIDDIQUI: Right. BLITZER: All right, everybody, stand by. There's more news we're

following, including Stormy Daniels' former lawyer charged with stealing hundreds of thousands of dollars from the porn star who said she had an affair with President Trump.

Plus, Kim Jong-un slams a potential Trump challenger. So what's behind North Korea's swipe at Joe Biden?

[17:39:25] (COMMERCIAL BREAK)

BLITZER: More breaking news now. More trouble for celebrity lawyer Michael Avenatti. A federal grand jury indicting him for allegedly stealing from former client Stormy Daniels and with trying to extort millions from sportswear giant Nike.

Let's go to our national correspondent, Sara Sidner, who's working the story for us. Sara, update us on the very latest.

SARA SIDNER, CNN CORRESPONDENT: Yes, Wolf. So federal prosecutors have indicted Michael Avenatti in two separate indictments, one we all knew about. That is the case against -- involving Nike, which involves extortion of more than $20 million that prosecutors say he was trying to get out of Nike after trying to expose wrongdoing at the company involving recruitments for college athletes.

Now, the other indictment was a bit of a surprise to the public, at least. It involves his financial dealings with his, perhaps, most famous client, Stormy Daniels. And you see her there.

The two have been working together for many, many, many months on the case that they brought against the President. She sued the President. He was her attorney representing her.

[17:45:04] Well, they both got very famous off of this case, of course, and she intended to write a book. Michael Avenatti, according to prosecutors, brokered that book and in so doing, they say, defrauded her of advance money. Money that the literary agent was going to pay her in advance of the book that eventually published called "Full Disclosure."

They say that he took about $300,000 from Stormy Daniels in advance money to use for his own extravagant lifestyle, money he was supposed to be giving to her. And they say that he actually forged documents, signing her name to documents, saying that that money was fine to be put into his account.

He eventually, according to prosecutors, paid her back about half of that, $148,000, but failed to pay her the other half as well and, in the meantime, was using that money for his own personal and business use in other cases or for other things.

So, certainly, we expect to be hearing at some time from Stormy Daniels herself, but we have heard from Mr. Avenatti. And he has said that he has not done any of this, that no moneys were misappropriated from Stormy Daniels. He expects to be fully exonerated, that she has not -- that he has not

received anything but $100 and that he has given her millions of dollars' worth of legal services, Wolf.

BLITZER: Sara Sidner, reporting on the very latest on that, thank you.

Coming up, North Korea lobs a Trump-like insult at Joe Biden. What is Kim Jong-un up to?

Plus, breaking news. A federal judge upholds House subpoenas for the President's financial records. I'll speak live with the chairman of the House Intelligence Committee, Adam Schiff. He is standing by.

(COMMERCIAL BREAK)

[17:51:15] BLITZER: He has traded insults in the past with President Trump, but now Kim Jong-un seems to be going after the Democratic presidential front-runner.

Brian Todd has been looking into this for us. Brian, what is this all about?

BRIAN TODD, CNN CORRESPONDENT: Wolf, the North Koreans seem to be furious with Joe Biden tonight. Biden's been going after Kim and his relationship with Trump at recent campaign events. And true to form, the North Koreans are responding with personal insults that sound like playground jabs.

(BEGIN VIDEOTAPE)

TODD (voice-over): Tonight, Donald Trump's 2020 campaign has an unusual new surrogate. North Korean dictator Kim Jong-un. The man Trump once called --

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Little Rocket Man.

TODD (voice-over): -- blasted headlong into the U.S. presidential contest, his news agency tearing into Democrat Joe Biden. The insults, published as part of a commentary in North Korea's state-run newspaper, are classic Kim.

Biden is an imbecile, bereft of elementary quality as a human being, Kim's news agency says, calling the former Vice President a fool of low I.Q. That mirrors an insult President Trump leveled at Biden in March when he tweeted Biden is, quote, another low I.Q. individual.

FRANK JANNUZZI, PRESIDENT AND CEO, THE MAUREEN AND MIKE MANSFIELD FOUNDATION: It's not a coincidence. The North Koreans pay attention to President Trump's rhetoric very closely. They also pay attention to his political objectives very closely. They are playing to an audience of one. They know that he enjoys hearing his words parroted back to him.

TODD (voice-over): The North Koreans' insults of Biden appear to be in response to a comment the presidential contender made recently about the relationship between Trump and Kim.

JOE BIDEN, DEMOCRATIC PRESIDENTIAL CANDIDATE: He embraces Kim Jong-un in North Korea. This is a guy who had his uncle's brains blown out sitting across a table. This is the guy who is a thug. And he's writing love letters to him.

(LAUGHTER)

BIDEN: No, I'm serious.

TODD (voice-over): Tonight, Kim's regime is calling those comments slander and saying the idea that Biden could be the front-runner in the American election is, quote, enough to make a cat laugh.

PATRICK CRONIN, ASIA-PACIFIC SECURITY CHAIR, HUDSON INSTITUTE: This is part of Kim Jong-un trying to curry favor with President Trump, his main interlocutor, and to beat down criticism of his regime.

TODD (voice-over): This new barrage against Biden is ironic, analysts say, because Kim lobbed similar insults against Trump just two years ago after Trump issued this threat.

TRUMP: They will be met with fire and fury like the world has never seen.

TODD (voice-over): During that period, the North Koreans called Trump a mentally deranged dotard. Trump responded sarcastically, tweeting about Kim, quote, I would never call him short and fat. Since then, they've had a diplomatic breakthrough.

TRUMP: We fell in love.

TODD (voice-over): But given Kim's current relationship with Trump, some experts now wonder if Kim Jong-un is taking a page out of Vladimir Putin's playbook and trying to interfere in America's elections in favor of Donald Trump.

Experts don't believe Kim has the kind of intelligence network Putin had to pull that off, but one analyst believes Kim does want to interfere by striking a nuclear deal with Trump and then possibly trying to extort the President.

CRONIN: After that agreement is made, as the election starts unfold, Mr. Kim says, oh, Mr. President, I can't deliver on that. I need more money. I need more sanctions relief. Oh, you don't want this deal to go through? Do I have to tell the world and tell the American electorate that your deal is falling through? And Trump would say, no, no, give him what he wants.

(END VIDEOTAPE)

TODD: But Trump has actually not given any indication so far that he would be such a pushover. He's been firm with the North Koreans, keeping tough sanctions in place and walking away from a deal in Hanoi. Meantime, Wolf, responding to North Korea's insults, the Biden

campaign has sent CNN a statement saying in part, quote, Trump has been repeatedly tricked into making major concessions to the murderous regime in Pyongyang. It is no surprise that North Korea would prefer that Donald Trump remains in the White House -- Wolf.

BLITZER: Brian Todd, reporting for us. Thank you, Brian.

[17:54:57] Coming up, breaking news. Another legal loss for President Trump. A federal judge sides with congressional Democrats on subpoenas. I'll speak with House Intelligence Committee Chairman Adam Schiff whose committee won that fight.

And the President goes on a tirade, storming out on Democrats. We'll be right back.

(COMMERCIAL BREAK)

[17:59:57] BLITZER: Happening now, breaking news. Ruling against Trump. The President just lost another round in his legal battle against subpoenas from House Democrats.