tv CNN Newsroom With John Berman and Poppy Harlow CNN August 7, 2018 6:00am-7:00am PDT
top of the hour, good morning everyone, i'm poppy harlow in new york and we are minutes away from what is sure to be many more hours of dramatic and testimony for the star witness of the prosecution of the backs fraud and tax evasion trial of paul manafort. rick gates returns to the stand telling jurors he helped his boss hide foreign bank accounts from the irs and helped himself to vast sums of cash. that's not the only big story we're watching. voters in ohio are deciding the outcome of the last special election before the midterms. that's why it's so important. we start at the u.s. district court in alexandria, virginia.
joe johns is outside. we're half an hour from this trial getting under way. what are we expecting today? >> i think at first we're expecting more of the game. gates was on the stand for about 45 minutes before they wrapped up late last night. he'll continue on direct testimony answer questions of the prosecution about what the government alleges is a whole pattern of illegal conduct that stretched out over years and years and years. rick gates became his deputy campaign manager. . it's important to remind people who this guy is. gates was a long time personal confidante, if you will, of paul
manafort and is believed to know basically all of the inner workings of the manafort organization. i think it's extremely important to point out that the allegations against mr. manafort include dealings in ukraine with hidden bank accounts and gates is alleged to know everything about that, poppy. >> and i mean i was reading that it's going to be something like they expect three more hours of direct examination. >> we have the cross-examination that could come as early as today and they'll try to tear down the whole house that the prosecution has built up. so what happened yesterday
probably the most key and important point was about the 15 foreign bank accounts. of course that's part of the indictment that is alleging wrongdoing by paul manafort. 15 foreign bank accounts mr. gates said existed. they concealed the evidence of those from the united states government from the tax collectors, the internal revenue service. also important to say that rick gates has admitted to stealing hundreds of thousands of dollar s from. >> with me crime and justice reporter and our legal analyst and former federal prosecutor laura coates. so much to go through and we're not done with the direct examinatio
examination. >> here you've got paul manafort who's being accused of all these different crimes, even with his opening statement through his defense counsel said listen, you cannot believe this person rick gates. he's got a plea deal, he has every incentive to not tell you everything that is true because he wants to get a good prison sentence or none at all so we have this battle right now. while they have framed this in a battle of credibility, birds of a feather flock together and a jury will look at this and say we have somebody here who's admitted to lying, who has been in on this conspiracy to try to evade having pay his taxes to uncle sam unlike the rest of us and he's admitted to stealing from paul manafort. but wouldn't you expect somebody who is doing the criminal activity that manafort has been accused of to have associates who also do criminal activity?
>> he has not been granted immunity. it's up to the judge. he has every incentive to say what the prosecution wants him to say, right? >> he has every incentive to tell the truth because the prosecution would like that person testifying even with the cooperation deal to give all the information that they told them they would in the earlier meetings. you first meet with the prosecutors before you get a plea offer that says here's what i'm going to say. it will be corroborated by various mechanisms and you have to stick to that truthful story. if you don't. if you withhold information, remember, he has not been sentenced. they have not guaranteed. they will argue in court for his plea and hiss prison sentence to be a small amount of time so he has to cooperate to the very end but the defense, you're right, poppy, will try to say you can't believe somebody who has every incentive to tell the government what they want to hear, whether it a test truth or not. >> shimon, we know the defense strategy because they laid it
out in the opening statement and that is that manafort's an innocent victim, gates ran this whole thing and he's a liar. how much do you think the admission from fates purpogates purposefully in the direct examination by the prosecution that he did steal and was committing crimes may help the defense here? >> i think it's going to help them tremendously. but you have to think of it this way, poppy. the prosecution it appears has a ton of other evidence against paul manafort right now and they've already laid that out within an accountant and what you see in these cases, usually, is you bring in all these other witnesses to corroborate everything that perhaps your key witness, your star witness which rick gates is at this point. rick gates has all sorts of credibility issues. he lied to investigators about
his deals with the ukrainians so all of that is going to help the defense and i'm sure knowing this defense team there is going to be other indications of -- issues with his credibility, perhaps other bombshells that are yet to come under cross-examinati cross-examination. this is typical of what prosecutors do, they get everything that may be negative out ahead of a cross-examination obviously so that it doesn't appear like they're hiding anything. but the idea -- we couldn't believe it when we heard yesterday that rick gates said that he had been stealing, essentially, from paul manafort, making up expense reports. that is going to help the defense. >> laura, do you believe that this testimony that we got yesterday and more of to come this morning from rick gates ups the pressure and the heat on manafort to take the stand? >> it does.
you'll have documents to corroborate the testimony of rick gates to say this is largely documented. either you had $3 million or you were a million dollars in the hole which is part of the testimony that's come in. either you knew about the tax obligations or didn't and you tried to evade time. documentary evidence can speak for itself. what gates is providing people is the insight into what manafort knew and whether or not he intended to do this. and what is most interesting about the strategy here, poppy, if i may just say, shimon is right. if i was the prosecutor in this case, i would have been very angry to have called my witness yesterday and allowed for for defense to build a case based on what he said and have a whole night to think about it. on the other hand, the jury now has the big bombshell there their minds and they can be dismissive of it overnight going to the meat of the matter about what paul manafort knew. on the one hand, it's frustrating to have your witness have this bombshell and the defense can dissect it overnight. now the jury says okay, he lied about something, he embezzled
funds, now tell me what the person who's on on trial has done wrong and they have because to do all that. >> shimon, remind us of the charges here. really not just charges, what rick gates has pled guilty to because he faces almost a decade in prison? >> he does. but he said on the stand yesterday that prosecutors have indicated that-to-his attorneys that they wouldn't impose a lighter sentence. he's likely to get probation because he's cooperating. he's told the juror he met with prosecutors and investigators 20 times so we don't know on everything. they this may be only a small part but it's all charges to paul manafort with an additional charge of lying because when he met with investigators initially he lied to them about his contact with ukrainians and business dealings which is something that helps the defense as well.
his correct is going to be an issue at this trial. prosecutors know that and usually what happens these kinds of witnesses who plead guilty tend to face a substantial amount of time in jail. we've seen these in mob case, terrorism cases, witnesses are important to helping prosecutors bring cases and investigations. this is what's really i think for all of us what we don't know about rick gates' full cooperation because there have been indications that he's not needed in this case because they have this overwhelming ed. >> shimon, thank you. laura, good to have your expertise. ahead, president trump's big test. can republicans hang on to a typically reliable republican seat in ohio or will democrats pick up another congressional seat in the last special election before the midterms? the polls are open in ohio. cnn will have extensive coverage of the results as they come in. of course much more on that race
tonight in prime time. plus, put down the phone. key advisers now urging the president to stop tweeting about that trump tower meeting. will he follow that advice? and in california, more than a dozen wildfires are burning out of control. now the largest wildfire in california's history paving a path of historic instruction. i don't keep track of regrets. and i don't add up the years. but what i do count on is boost®. delicious boost® high protein nuritional drink now has 33% more protein, along with
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the democrat is danny o'connor. he's a young man, not a ton of experienced running against an established state senator by the name of troy balderson. balderson has the support of president trump. that's the key element to this race and one of the reasons that's getting so much national attention. this is a district in the hands of republicans for 30 years. it'sing? governor here john kasich who once held this seat believes that it should be a slam dunk for republicans. but the fact that it's so close could have something to do with president trump. even though that is the case troy balderson accepted the president's support and this morning president trump tweeted his support of balderson. the results could end up being a foreshadowing for these races in november. will republicans stick by the president or run away from him? the results could tell us about what happens in the fall. poppy? >> ryan, thank you so much.
let's listen to something troy balderson told voters that has everyone talking this morning. listen. >> my opponent is from franklin county and franklin county has been challenging. we don't want somebody from franklin county representing us. >> with that he wrote off a third of the voters. why? joining me now, cnn congressional correspondent phil mattingly and cnn politics senior writer and analyst harry anton. you caught my attention when you said this is analogous to someone running in new york city and writing off the entirety of brooklyn. why would he do this? >> if you were to look up in the dictionary "gaffe" and then there would be a picture beside it or an audio rolling that is what you do. the reason he did that is because he recognizes his votes will come mostly from outside of frankl franklin.
i think that this is a guy feeling a lot of pressure, recognizes the polls are closing in a district he should be winning easily and the pressure got to him. >> he said he's trying to clean it up and he said of course i'd represent the whole district. but he's carried the district over 20 points in 2012. you have spending near is five times on the republican side outside of republican spending five times that of outside democratic spending and it's still 43-44. what does that tell democrats? should it be a warning to republicans, even if balderson pulls it off? >> it's a warning. you can talk to any republican involved with campaigns and they recognize this for a couple reasons. the first is you look at this district and i will note some people are overlooking the fact there are rural areas in this district that are big trump supporters. >> that's who he was talking to last night. >> and that's why president trump came in saturday. this election is about turnout -- as they all are -- but especially a general election. those counties, those areas
matter but it's heavily suburban. very highly educated, highest educated district in the entire state of ohio. those are the voters that have trended far away from the president in 2016 and since then and that presents an opportunity. you add the fact that it's in august, august 7 when people are in final vacation before school, a special election, you don't get huge turnout anyway and you have enthusiasm driven bin the president. it's kind of a perfect storm where a district that pat teaberry won is now very, very much in play. >> everyone is talking in these august vacations? >> who takes them? >> i want one. >> when it comes to how either party is going to spin this depending on who wins tonight, why is this race so important in terms of a sign for november nationwide? >> i think for a number of reasons. it's a well-educated district as phil was talking about and
democrats want to target well-educated districts that have been republican. two, it's in the industrial midwest that democrats want to pirg up seats there and special elections in general we have seen a sign throughout this cycle of democrats outperforming the partisan baseline and they would like to do that one more time. >> let's talk about -- this is not the only race today. i would be remiss not to mention kansas, not to mention michigan but talking about kansas, the president's endorsement of kris kobach. he ran the president's short-lived voter fraud investigative team, if you will but this is a big deal that the president has supported him and it could cost. >> i mean, look, he has gone against the kansas state republican part yy. this is incredible to me that you have the republican president of the united states coming in and not endorsing the republican sitting governor and
kris kobach is the least popular major politician in the state. >> is this just a loyalty play to say thanks? >> and that he lines up more ideologically with him but if you look at kris kobach's numbers and the polling for the general election, even though kansas was won by donald trump by a little over 20 points, kris kobach could lose that seat for republicans in the fall. >> let's talk about michigan, the odds are tough but you have the democrat abdul el-syed vying for the governor's race. if he wins, he would become the country's first muslim governor. he had support from big names, bernie sanders, alexandria ocasio-cortez. what are his odds? does he make history? >> it would be history. he had a long road to climb and even though he was very much resembling a bernie sanders like campaign, bernie sanders came in late but there is the boost and
it's there and worth remembering bernie sanders worn michigan when nobody thought he had a chance. it's one of the things where at this time of year with racings where people aren't motivated, the candidate with the most motivated voters will come in. but he wasn't raising the none heavyweight was supposed to raise but over the course of the last two weeks -- and you can correct me if i'm wrong, in terms of name i.d., attention and getting his message out and attaching to a grass-roots that's real inside the state of michigan, he's had momentum. >> and you think about dearborn, michigan, i think people don't know the major arab american population in dearborn. >> i would point out witmer, this is the year of the woman and that's why she should be favored. >> thank you both. you guys have had a long day. phil, you've been here since like 2:00 in the morning. thank you very much. the president's team has a new message to their boss. stop tweeting about that trump
tower meeting. is their audience too little too late? we're moments away from the opening bell on wall street looking like stocks are set to rise in the green this morning after futures are pointing. why? because of strong corporate earnings, overall profits up more than 23%. the second best since the the second best since the recession.
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this morning, president trump out of the public eye and so far no mention of that infamous 2016 trump tower meeting on twitter, or at least his twitter feed. why? maybe because his legal team urged him to stop as they are weighing an interview too the president and the special counsel. abby phillip, you're close to where the president is. why are his advisers reportedly so worried about the president's tweets from this weekend? >> it might not come as a lot of surprise to people that lawyers don't like their clients tweeting about an on going investigation but his advisers are telling him something different in this case. don't tweet about this because it's fueling a media narrative. even if we believe you did nothing wrong, his adviser ares saying it's only restarting all these conversations about this issue of obstructions.
it launched a slew of conversations about whether the president lied about that meet ing so their advice is don't tweet about it and for now he's taken that advice, at least for the last day or so, poppy. >> but will he take their advice when it comes to doing an interview? he said repeatedly i want to do this interview, i have nothing to hide. his team has been adamant they don't want him to. what's the status? >> we were told yesterday by right that they' rudy giuliani that they'll give a response today or tomorrow about the status of their interview. we don't know what they will say but it will be another volley in the back-and-forth they've had for weeks but then giuliani told the "washington post" that they are going to say they have a lot of concerns about the issue of obstruction, about allowing the
president to answer any questions at all about obstruction so it seems we are back where we've always been. the president's lawyers trying to push back on the issue. we'll see how mueller responds back to them. >> abby, thank you for the reporting. let's talk to my panel about it. ron brown steen is with me, and renato mariotti. let's hear what anthony scaramucci had to say about this. >> when you're protesting you don't have to be a shakespearean scholar, but when you're protesting and the words "doth protest too much" why are you protesting? if you're right on the facts the facts will unfold in a way that's favorable to you and you'll be better served not talking about it. >> doth the president protest too much?
>> the scaramucci era. look, i think to me the core -- it's fascinating watching this debate within the president's camp because the idea that a sitting president would refuse to talk to a special counsel investigating a foreign government's attempt to influence the 2016 election seems politically incredible by historical standards. the issue hasn't been litigated but in the past bill clinton sat down with ken starr in part because they recognized that the signal it sends to the american public if you refuse to answer yeses about your behavior is dramatic and as republicans brace for what's happening in ohio today win or lose this kind of thing reinforces the doubts among the white collar voters that trump has been driving away from the republican party so while there's a legal debate
about whether it makes sense, the politics of this seem to me very somes now and dangerous for the president to refuse. >> but don't forget his win was politically incredible. his win went against the polling, right? so this may continue to be different territory. when you look, renato, legally at this, the president's story changed about why the trump tower meeting was taken, what is your read on why his legal team is worried about these most recent tweets. >> well, this is a matter, kate, that is under investigation by the special counsel and i will tell you now that i'm on the other side and represent clients under investigation i would not want them saying anything about matters represented by
prosecutors, you have to be careful because those tweets can be used against him, robert mueller can print them out and put them in his exhibit bient r -- binder. when you have a situation where you are seeking aid and accepting aid from foreigners in connection with an election, if you agree to that, that is a federal crime and so those e-mails between donald trump jr. and the promoter saying hey, this is part of the russian government's effort to help your campaign, that's dangerous territory. so whenever you have a client that is connected to people involved in criminal activity, you have to be careful about what you have that person say. >> ron. an interesting thing we're seeing is that the russia tweets no collusion, et cetera, et cetera, talking about the intent of the meeting are pom ing ing
between tweets of the candidates he's chosen in michigan and kansas. and i wonder what you think from republican candidates trying to win tough races, balderson in oh ohio, it's interspersed. i wonder what you think their read is? >> i think there's a thematic consistency in the tweeting that is part of the broader political strategy of the president in the midte midterm. the tweets are aimed at the republican base to undermine the credibility of the mueller investigation. they're not designed to reach swing voters or sway people in the president's camp. it reinforces an electoral strategy that's aimed at the base which is emphasizing cultural and racial disputes around issues like immigration or attacking lebron james so it is all in one piece. but if you are running in the
franklin county part of the 12th district of ohio, you look at this and see the potential for moving away from the party voters who have been more comfortable with republicans than democrats and any republican that doesn't have the rural side of ohio 12 has to look at this with alarm. >> gentlemen, thank you both. we'll have more time next time around. i need to jump to california, though, and these raging wildfires, appreciate you being with me. they are burning out of control right now, an area nearly the size of los angeles. the biggest wildfire in california's history keeps growing. a live report ahead. today's fluctuating interest rates can increase your anxiety when buying a new home. that's why quicken loans created our new, exclusive
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details about gates' testimony so let's go back outside the courtroom wlav courtroom. what are you hearing about, joe johns? >> well, it has to do with the plea agreement signed by gates as he pled guilty to a variety of charges including false statements and agreed to cooperate with the government so among the things we learned in the testimony yesterday is that he's met 20 times with the government to talk about this case. that's a lot of meetings as they try to dissect what testimony he would give in court today. he did admit to other crime wes didn't know about until
yesterday. that would include lying on a mortgage application. lying on a credit card application and as well there's been a lot of talk about rick gates essentially stealing hundreds of thousands of dollars from paul manafort by inflating his expense accounts. the defense has asserted without providing any proof that that that number could be in the millions but it has yet to be discussed on direct testimony. it could be discussed on cross-examination, poppy. >> which we will see later today. before you go, joe johns, clarify what appears to be an an important part of the deal that the government gave him in response to his testimony. it agrees prosecutors have agreed not to seek new charges
against him, is that right? >> that's an important thing to point out. they have agreed not to bring new charges against gates. he is waiting to be sentenced and that will come after this trial so the question, of course will be whether he gives truthful and useful testimony and they can calculate in what they'll do with the sentence. it's not clear he's going to get a more lenient sentence though that has been suggested publicly. to california where a wildfire is burning in northern kra that california that is the large nest the state's history. the largest of all california wildfires burning in california. you have firefighters on the front lines trying to stop it from spreading even more. there are 16 major fires burning across the state. by far the largest is the mendocino complex fire. the blaze is made up of two
wildfires burning close to each other covering the 283,000 acres. that's as big as the city of los angeles. last night the fire was 30% contained. 30% containment on the biggest wildfire in california's history. what are you seeing? >> this fire sums up wildfire season. it's about the size of the city of los angeles, as you said ig bigger than all five boroughs in new york. 30% contained. this is one of the structures destroyed. this fire is burning in a remote area. you can see the landscape behind me, this is very rugged, steep terrain. this is where the fire is burning. not really burning in populated areas so while this is the biggest wildfire in state history, it's not the most
destructive but when you talk about the weather, the hot temperatures, triple digit temperatures today and windy conditions there's a concern% push into those more populated areas, poppy? >> dan simon please keep us posted. the images are striking to say the least. the u.s. has reimposed the sanctions on iran, at midnight, just a few hours ago. the administration claims they are already working. here what the president of iran is saying. ...that's just my favorite boat. boom. (laughs) make summer go right with ford, america's best-selling brand. and get our best deal of the summer: zero percent financing for sixty months on f-150. right now, get this special offer on f-150: zero percent financing for 60 months - during the ford summer sales event.
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president trump is out ttou the sanctions on the iran saying they were the most biting sanctions ever imposed. there are stricter up withes coming, the president notes, he also said i'm asking for world peace, nothing less. now iran's president is vowing to make america regret these sanctions. he says he's willing to sit down and talk to president trump and national security adviser john bolton who told jake tapper just yesterday he is skeptical about iran's true intentions here. list listen. >> if the iranians are willing to talk about their malign behavior they'd find the president willing to do it but this is a question less about their propaganda and what their intentions are. >> let's talk about the tehran bureau chief from the "new york times." thank you for being here. i think the quote that stood out to me the most was from the "times" on this and they quote a man in tehran, an average citizen who sells fruit and
vegetables at a stand and he said the economic anxiety in iran is so high that, quote, people think twice about even buying an ice cream. you've been reporting for a decade. how are iranians reacting? decade, how are iranians reacting? >> they feel the country has been devastated economically. first and foremost by the decisions of their leaders. there have been many corruption cases, they have made wrong decision when was it comes down to investments for policies, ideolog ideology, if you will. also because of sanctions being imposed against by the united states, iranians have already gone through a period of sanctions that led actually to the nuclear talks, that ended in the nuclear deal in 2015. and now again, they could see the devaluation of their currency.
the iranian money has lost over 80% of its value. if you take your bank account and deduct 80%, it shows what happened to the purchasing power of iranians. milk, rice, have gone up, houses, cars, have gone up. people feel as if they're caught between the two mammoths, if you will. on one hand the iranian system that right now rick gates is the
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he said this on fox news this morning and with jake last flight, as well. it's significant to hear from him. >> it's about time we heard somebody say that. he appears to be one of the first in the administration to admit that all is not well following the big summit with kim jong-un that the president had not very long ago. and north korea hasn't taken the steps necessary. just yesterday bolton was saying that the u.s. is still waiting for north korea to begin the process that it committed to. listen -- >> they were waiting for the north koreans to begin the process of denuclearization which they committed to in singapore and which they've not yet done. >> we have the administration now talking about north korea not doing enough when it was only days ago the secretary of state, mike pompeo, was testifying on the hill before a bunch of senators. he seemed to be saying, yes, there's progress, progress, progress, but he would not talk about it. now bolton is saying, no, north korea needs to do something. he's using the words again
"maximum pressure" to maintain that on north korea, that's a phrase the president himself said he would not use anymore because he thought things were going well. >> michelle, thank you for the reporting and the update. it's important. top of the hour, good morning, everyone, i'm poppy harlow in new york. right now the former business partner, former protege and co-defendant of president trump's former campaign chief rick gates -- >> he is the prosecution's star witness in the bank fraud and tax evasion trial of paul manafort and likely faces several more hours of direct examination after what is sure to be a withering force. he said he and gates together had 15 foreign bank accounts from the irs and admitted to stealing hundreds of thousands of dollars from his