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Trump breaks silence on Stormy Daniels. TRANSCRIPT: 04/05/2018. The 11th Hour with Brian Williams

Guests: Catherine Lucey, Barbara McQuade, Philip Bump, Shannon Pettypiece, Jon Meacham

Show: 11TH HOUR WITH BRIAN WILLIAMS Date: April 5, 2018 Guest: Catherine Lucey, Barbara McQuade, Philip Bump, Shannon Pettypiece, Jon Meacham

LAWRENCE O`DONNELL, MSNBC HOST: Up next, Catherine Lucey, "The Associated Press" Reporter on Air Force One today who you heard ask President Trump for the very first time about Stormy Daniels and get an answer. She is the first guest in "THE 11TH HOUR WITH BRIAN WILLIAMS" and that starts now.

NICOLLE WALLACE, MSNBC ANCHOR: New tonight, President Trump breaks his silence on Stormy Daniels and that payment to keep the porn star quiet. The reporter who finally got him to answer the question joins us.

And breaking tonight, late developments in the Mueller probe. New scrutiny of the President`s lawyer, Michael Cohen, and The Trump Organization.

Plus, the hits keep coming for embattled EPA Chief, Scott Pruitt. So you might be surprised to hear what this President had in mind for him. A promotion. "The 11th Hour" begins now.

Good evening once again from our NBC News Headquarters here in New York. I `m Nicolle Wallace in for Brian. Day 441 of the Trump administration and President Trump has broken his silence on porn star Stormy Daniels.

On his way back from West Virginia, the President denied knowing about the $130,000 payment his Attorney, Michael Cohen, made to Daniels just days before the 2016 election.


CATHERINE LUCEY, WHITE HOUSE REPORTER, "THE ASSOCIATED PRESS": Did you know about the $130,000 payment to Stormy Daniels?


LUCEY: Then why did Michael Cohen make it if there was no truth to her allegations?

TRUMP: You would have to ask Michael Cohen. Michael`s my attorney and you`ll have to ask Michael.

LUCEY: Do you know where he got the money to make that payment?

TRUMP: No, I don`t know.

LUCEY: Did you ever set up a fund of money he could draw from?


WALLACE: The President did not answer that last question about whether he ever set up a fund from which Cohen could draw. In just a moment, we`ll talk to Catherine Lucey of "The Associated Press" who asked those first two questions of the President.

Stormy Daniels has said the payment was hush money to keep her silent about an alleged sexual affair with Trump in 2006. As we`ve reported, Daniels is now suing President Trump to invalidate a nondisclosure agreement on the grounds that the President never signed it.

The White House has repeatedly denied that President Trump had an affair with Daniels. Michael Cohen has said the payment came from his own personal funds and not the Trump campaign or the Trump organization.

Cohen`s attorney commented on the President`s remarks tonight, saying, "This is an accurate assessment of the facts. This is exactly what I`ve been saying all along. Michael Cohen made the payment to protect reputation, family, and businesses. It had nothing to do with the election."

Meanwhile, here`s what Stormy Daniels` Attorney, Michael Avenatti, told Lawrence O`Donnell about the President`s remarks.


MICHAEL AVENATTI, ATTORNEY FOR STORMY DANIELS: We think this is basically game over as it relates to our claim. We`ve heard, Lawrence, for the better part of a month now that this was a rock-solid, airtight agreement. You`ve got David Schwartz out there talking about what an excellent lawyer Michael Cohen is and how this was a model. This was a model NDA. It`s a lot of things, but there is no way in hell it`s a model NDA.

This thing is a piece of trash in reality and everybody knows it and any legal analyst that looks at it will tell you the same thing, who`s not biased. But that`s what we`ve been hearing. And now what we have is, we have a principle party to the agreement, who admits on camera that supposedly he didn`t know anything about a principle term of the agreement. Well, that means he didn`t know anything about the agreement, which means there is no agreement.

So all of this chest pounding and these threats about how we`re going to bury my client and they were going to seek $20 million and they were going to go on an extended vacation with the money and all of this other buffoonery that we`ve heard for the last few weeks, that all goes out the window.


WALLACE: Let`s bring in tonight`s lead-off panel, Phil Rucker, White House Bureau Chief for "The Washington Post" and an MSNBC Political Analyst, the aforementioned Catherine Lucey, White House Reporter for "The Associated Press," who asked Trump questions aboard Air Force One, and Barbara McQuade, Former U.S. Attorney for the Eastern District of Michigan.

Let me start with you, Catherine, since you put those questions to the President. I`m not sure when you were growing up you thought you would come to the day where you would ask the leader of the free world about an alleged affair with a porn star, but talk to us about that exchange and the revelations from the President`s responses.

LUCEY: Yes, thanks, Nicolle. Great to be here.

Yes, we had the President come talk to reporters on Air Force One today. Sometimes he does come back and visit with reporters, talk a little bit about the events or what`s going on that day. He wanted, obviously, to chat after his event on taxes in West Virginia.

But the situation with Stormy Daniels is something that he has not spoken about previously. And so that was one of the things that I wanted to put to him. And so, as you said, I asked about the $130,000 payment, did he know about it. He pretty flatly said "no."

WALLACE: So the significance of that, Barbara, seems to be, according to Mr. Avenatti, Stormy Daniels` lawyer, who says, "Our case just got that much better. We very much look forward to testing the truthfulness of Mr. Trump`s famed lack of knowledge concerning the $130,000, as he stated on Air Force One." What is the significance of Donald Trump alleging or claiming that he had no idea about the agreement in terms of the case Avenatti is making to invalidate the NDA?

BARBARA MCQUADE, FORMER U.S. ATTORNEY: Well, this is a great example of why lawyers tell their clients not to speak publicly about matters in litigation, because this statement can be used as an admission by President Trump that if he didn`t know about the agreement and he is one of the principle parties to the agreement, then that feeds right into Stormy Daniels` theory that this agreement is null and void. You can`t enter into a contract you don`t know about. And so that`s their whole goal, to invalidate the contract so that she can sell her story free of any legal consequences.

So I think he very badly damaged any argument that this is an enforceable contract.

WALLACE: So you`re our straight shooter on all legal questions here. This seems like a very bad day legally for the President on at least one front. And later in the program, we`ll get to the Mueller probe.

But on the Stormy Daniels front, is this a clear setback for the President`s lawyers representing him in the Stormy Daniels affair?

MCQUADE: Well, I think it could be, because not only does it affect the enforceability of the contract, but it also suggests that Michael Cohen may have done some things that are unethical. It is a lawyer`s duty to keep a client reasonably apprised of all matters. It is a lawyer`s duty to discuss settlements with their clients and not to enter into settlements unless they`re so authorized by their client. And so, these statements could also get Michael Cohen into some ethical trouble with the state bar of New York.

WALLACE: Phil Rucker, in the good old days, when the White House and campaigns had messages of the day, you wouldn`t have made unethical actions the message. But if you look at the day in total, between Scott Pruitt`s antics, between Barbara`s assessments of Michael Cohen`s conduct as a lawyer, unethical seems to be a pretty good way to wrap up the day. What story -- what part of the story do you think irks the President the most?

PHIL RUCKER, WHITE HOUSE BUREAU CHIEF, "THE WASHINGTON POST": It`s probably a few things. I think he`s feeling a lot of personal pressure because of this affair, because it happened right around the time that Melania, his new wife, had given birth to their son, Barron. This is clearly something that we know just from our reporting that has bothered the President for a while.

WALLACE: What, that he had an affair just months after his wife had a baby or that we know that he had --

RUCKER: That we know about it. That the public knows about it. That Stormy Daniels is telling her story and that we`re talking about it.

And, frankly, the President has not given satisfactory answers. This is the first time really in more than a year that he`s addressed this issue directly. And as you saw in the tape there from Air Force One, he`s not answered all the questions.

His spokespeople have denied Stormy Daniels` account of events, but Trump himself has not addressed the American people at all about what happened, what didn`t happen, what is she saying that`s true, what is she saying that`s not true? And we still don`t have answers to those questions. WALLACE: You know, Catherine, one of the things I thought of when I watched that tape come in was of all the statements that Sarah Huckabee Sanders has made from behind the podium, when peppered by all of you about this topic. She said that he prevailed in arbitration. That doesn`t seem to be consistent with the President`s responses that he knows nothing of the payment.

If Sarah Huckabee`s statement from behind the podium was, one, there was no affair, two, there was an arbitration in which our side won. You had the President walk to the back of Air Force One where reporters sit. I assume there were press aides listening in. I wonder if anyone audibly gasped or if there were any sort of conversations about how he, you know, once again put his press staff in the position of being way over their skis once he came back and offered his to cents.

LUCEY: Well, I`m sure there were conversations about this, which seemed like an impromptu decision to come back. And I doubt that he had prepped to talk about this. But certainly we have seen, time and again, especially in recent weeks, this President doing things his way. I mean, we have heard from a lot of folks inside the White House. He is feeling increasingly confident that he is the best person to decide how he speaks, his decision making on policy, on hiring, and we are really seeing sort of an emboldened President or as some people say, an unshackled President, perhaps, trying to do things his way.

WALLACE: Unshackled is the word Sarah Palin used when the 2008 campaign ended. So it elicits all sorts of reactions in me.

But, Barbara, pretty quick, let me ask you about an unshackled President in the context of his legal exposure in the Stormy Daniels sort of back and forth. And let me ask you about Sarah Huckabee Sanders` contention that the President had prevailed in an arbitration. That seems inconsistent with what the President said today, which is that he had no knowledge of any agreement with him. If he had no knowledge, how can a spokeswoman claim that he had prevailed in an arbitration about an agreement that the President claimed he know nothing about?

MCQUADE: Yes. And I think that that arbitration decision is not going to hold up. You know, we`ve got a matter now pending in court where the position of Stormy Daniels is to invalidate this agreement altogether. And so I think in light of this admission, and even the position that Michael Cohen has taken, that they`re likely to get a different decision.

The arbitration will only prevail if there`s a valid and enforceable contract, because it is a provision of the contract that it shall been enforced in arbitration, not in court. If the contract is not valid, then the arbitration clause is equally invalid. So, I think that Stormy Daniels is going to have her day in court. And of course, what, I think, she may really want is an opportunity to take President Trump`s deposition, which could happen in the future.

WALLACE: Phil, I`ve interviewed Michael Avenatti and on that day, he was focused -- it was in the aftermath of the "60 Minutes" interview where Trevor -- where former election law expert was out saying that one of the most serious legal threats to the President in the whole Stormy Daniels escapade, while it may not be the sexiest detail, is the campaign finance violation aspect. How much of that part of the story concerns the White House?

RUCKER: It concerns the White House --

WALLACE: I`m sorry, Barbara, go ahead. You go first.

MCQUADE: I was just going to say, I think that could be a significant black-and-white law, you know. Even those who don`t care about the sex scandal I think care about compliance with the law. And even today, we had Mr. Schwartz, the lawyer for Mr. Cohen, say that the reason that the amount was paid was to protect President Trump`s reputation. That suggests that it could be related to the election when it comes right on the eve of election, as it did.

WALLACE: Go ahead, Phil. And let me ask -- let me pile on a two-part question for you. The first one about the level of concern about potential campaign finance violations and the second about the assessment in sort of people who are expert in this area of law, that this is so much more flagrant than things that have brought down other politicians, like John Edwards, whose trespasses were many, many, many months before any election. This was, I think, days before election day.

RUCKER: -- on days before the election. It`s a big concern for the professionals in the White House. It`s not a big concern for President Trump, who I think views the Stormy Daniels story as sort of a frivolous story that he wishes were not dominating the headlines, but he doesn`t really kind of grapple with the magnitude of the legal peril that he could potentially be in. But his White House officials do.

They see it as a serious story. They get why we`re covering it every day and they get how this could potentially be really problematic for him.

And, you know, based on his denial today on Air Force One to Catherine`s question about knowing about the contract, it just doesn`t make any sense. How would your personal lawyer spend $130,000 in hush money for someone who had a relationship with you and you not know about it? It just -- it doesn`t add up.

WALLACE: Catherine, I want to ask you about John Kelly, who I`m sure all of his time in the military, he never thought that he`d be convening meetings to discuss a response strategy, legal and communications, to an alleged affair with a porn star and the commander-in-chief. But I heard from a Trump confidant today who I asked about Kelly`s job security, I said, is he safe, is he OK? He said, nobody is safe, nobody is OK.

You and your colleague, our friend, Jonathan Lemire, have some new reporting out about John Kelly. What is the status at this hour? And I know in this White House, it changes hour to hour, but what is the status of John Kelly tonight?

LUCEY: Certainly, it does change hour to hour, but what we discover from talking to a lot of people inside and outside this White House is, his status certainly has diminished some. And some of that goes back to this idea that the President is increasingly going it alone, flying solo, and isn`t consulting Kelly the way he used to.

And so, on certain key decisions recently, Kelly was not as looped in on, you know, the hiring of John Bolton, for example, the phone call the President made to Vladimir Putin, congratulating him on his election results. These were things that, you know, Kelly was not a part of. He was not down at Mar-a-Lago over the recent weekend, when the President spent a lot of time talking about to people about immigration policy, which seems to have set the tone for what we`ve seen this week.

So he`s -- he`s certainly still there, and folks close to Kelly will say, well, he now, he now is -- has a better understanding of this President, is giving the President more rope. He doesn`t need to be as involved as he once was. But certainly, his profile has lowered and there is speculation about just how much longer he is going to be in the role.

WALLACE: Let me give you a quick last word. That syncs up with a lot of your reporting

RUCKER: That`s absolutely right. It was a great story by John and Catherine and they`re right, Kelly`s stature has diminished. His power is less inside the White House. He`s not around the President as much and the President isn`t turning to him for advice as much.

He sees him more and more as a functionary, as a staffer who just operates the government, but not the trusted right-hand that he was in his early months.

WALLACE: And I know he`s drawn like a magnet to all of his exes, Corey Lewandowski, you know, the old gang.

RUCKER: Exactly, Exactly.

WALLACE: All right.

RUCKER: He loves it.

WALLACE: Phil Rucker, you`re stuck with us for a little longer. Catherine Lucey, congrats on getting those brazen questions in today. We`re grateful to have you on that plane asking those questions for us.

Barbara McQuade, thank you for keeping us honest and making us smart. Thank you.

Coming up, as more stories emerge about Scott Pruitt`s rocky tenure at EPA, we`re also learning what Donald Trump had in mind for him as recently as last week.

And new breaking developments just tonight on the Mueller front. "The 11th Hour" just getting started on a Thursday night.



TRUMP: I think that Scott has done a fantastic job. I think he`s a fantastic person. I just left coal and energy country, they love Scott Pruitt. They feel very strongly about Scott Pruitt. And they love Scott Pruitt.


WALLACE: I bet they do. The President standing by his man tonight, publicly expressing confidence in the EPA Administrator, Scott Pruitt, now under fire amid mounting ethics scandals, including his $50-a-night condo rental arrangement, courtesy of a top energy lobbyist. That comes at the same time that "The New York Times" reports certain EPA officials were penalized for questioning Pruitt`s spending and management. According to that paper, some of those officials had very close ties to the Trump White House and to Republicans on the Hill.

Also new, "The Washington Post" reporting tonight two EPA officials confirmed that Pruitt endorsed the idea last month of giving big pay raises to two close aides. NBC News has also learned that President Trump as recently as last week had been considering replacing Attorney General, Jeff Sessions, with Scott Pruitt. But administration officials tell us that`s unlikely now, given recent reports about Pruitt`s conduct.

And today, when he was asked about it on Air Force One, Trump said, "Scott is doing a great job where he is."

This morning, The White House deflected when asked about what it plans to do, if anything, about him.


HOGAN GIDLEY, WHITE HOUSE DEPUTY PRESS SECRETARY: I can`t speak to the future of Scott Pruitt. I can just talk about where we are now and that is that the white House is aware of these reports. We`re obviously looking into those."


WALLACE: The Pruitt situation is the latest to test Donald Trump`s promise to drain the swamp, a slogan that`s changed in meaning since the 2016 campaign.


TRUMP: When we win on November 8th, we are going to Washington, D.C., and we are going to drain the swamp.

We have begun to drain the swamp of government corruption.

Washington is full of people who are only looking out for themselves.

Regulatory reform is a crucial part of our drive to drain the swamp.

By ending excessive regulation, we are defending democracy and draining the swamp. Truly, we are draining the swamp.


WALLACE: Back with us, Phil Rucker and joining us at the table is Philip Bump, National Correspondent for "The Washington Post." We call this a little "Washington Post" staff meeting, right. I love having you both here.

All right. So, drain the swamp. He`s filling the swamp, but Pruitt seems like the swampiest swamp monster of all.

You have a piece where you detail all of the reasons EPA Administer Scott Pruitt is in trouble and it is stunning. Let me tick through a few of them. He demanded 24-hour-a-day security. What is standard, for people who don`t know, is door-to-door where you transport a Cabinet secretary, but then largely leave them alone. He wanted round-the-clock supervision.

He installed a $25,000 sound-proof phone system in his office. And once you built it out, it cost the taxpayers $43,000. He flew first class at a cost of more than $100,000. Plus, they looked into NetJets, which is a private plane membership club, like Costco for private planes, I guess, right?

All right. The EPA explored -- looked around for a house for him. They found a room or a place in a town house that belonged to an energy industry lobbyist. I mean, if you wanted to write a script called "revenge of the swamp monster," you would find all of these things and stick it in the script and they would say, implausible.

PHILIP BUMP, NATIONAL CORRESPONDENT, "THE WASHINGTON POST: Yes, I mean, it`s sort of the -- it`s like a greatest hits of all of the bad news from the Trump administration. It`s, you know, spending tons of money on furniture like Ben Carson did, yes, did that. It`s taking big charter flights and military flights at high cost, yes, Pruitt did that.

But then on top of that, he has this weird living arrangement. He was paying $50 a night for this housing on Capitol Hill that was owned by a woman whose husband had business pending before the EPA. And actually it was something that was approved by the EPA, according to "The New York Time."

Under all these ways in which Scott Pruitt, were this any other administration, any other moment, we would have learned about this stuff after Pruitt had already left his position.

WALLACE: Just how bad it was.

BUMP: Exactly. I mean, but for I think two reasons, that hasn`t happened yet. One of those reasons is what Donald Trump just said. People who are -- the conservatives love Scott Pruitt as much as liberals hate Scott Pruitt because of how active he`s been in undercutting environmental regulations, and I think that that has made this a more politically polarized decision for President Trump than it would be for another Cabinet member.

WALLACE: This would be an obvious decision for any other President and any White House that values ethics. I have to say, these question crosses, though, the right/left divide for me when you look at who is upset inside the EPA. It`s not just the career officials.

"The New York Times" has some excellent reporting out this afternoon that actually broke during our hour at 4:00. I think there are four career officials quoted in that article, essentially whistle-blowers who asked to be reassigned, who spoke out about Pruitt`s abuses, about what is flagrant corruption.

There are also two political appointees. One is the chief of staff to the EPA, who is very much in line with all of the annihilation of the regulations that keep our air and water clean. So this is someone who`s upset about his policy choices. This is someone who`s only concern with Scott Pruitt is the annihilation of any sort of ethical standards of conduct.

The other person is someone who came from the Trump campaign. Again, not an ideological opponent. So he`s not just being questioned by people who are career employees, there are two political appointees who are at the EPA, who are sounding the alarms about Pruitt`s conduct. How does he survive that? And how does this not become a White House story?

Those two people seem to take this right to the doorstep of 1600 Pennsylvania Avenue.

RUCKER: And it is a White House story. What you have right now is the President is not -- or his staff is much further ahead on this than the President. I think if it were up to John Kelly, Pruitt would have been gone a long time ago.

The White House staff is exasperated with how Pruitt has handled this with these revelations that are diametrically opposed to President Trump`s campaign message of "drain the swamp" and with the way he`s managed it from a P.R. perspective.

The Ed Henry interview on Fox News was a disaster. Pruitt has not been forthcoming with the White House staff about what other shoe is going to drop, and yet the President is standing by him.

WALLACE: Do you survive botching a Fox interview for the reality T.V. President?

BUMP: I mean, I guess we`ll see, right? I mean, you know, I think that -- look, the thing that I have paid a lot of attention to over the course of the past however many days it`s been since the revelations broke about his condo is what the reaction has been within the conservative talking space, right? And so, yes, Ed Henry gave a tough interview on Fox News that the administration said, "Hey, don`t go and give your interview, Scott Pruitt," which he apparently ignored.

But conservatives have rallied around him as a symbol of the finger in the eye to liberal America, right?


BUMP: Environmentalists are legitimately furious at Scott Pruitt and what he has done. And conservatives see that as a victory in and of itself to a large extent. And so, there are a lot of conservatives who are saying, it doesn`t matter, you need to stick by him. If the liberals get his scalp on this thing, then they`ve essentially won a key battle.

It has become this incredibly partisan, polarized issue. So, yes, all of this is true, but it`s hard for me not to see what Donald Trump said today defending Scott Pruitt as not being a reflection of that conversation in the conservative sphere.

WALLACE: We`re out of time, but real quickly. Do you think that the President is willing to sacrifice his brand for someone who`s going to drain the swamp for someone who obviously has no ethics if he`s doing all of these good things?

RUCKER: That`s the question for Trump tonight. And the truth is, everything that Philip just said, Trump could pretty easily, I think, find somebody else in the government or outside the government who would execute the same agenda and have the same success as Scott Pruitt, if he got rid of Scott Pruitt.

WALLACE: Without a bulletproof desk and NetJets. They`re out there.

RUCKER: And going to the French restaurant.

WALLACE: They`re out there, Mr. President, I promise. Phil Rucker, thank you so much for spending some time with us and being in New York. Philip Bump, we`ll see you again later. You`re coming back.

Coming up, with all the chaos out of the Trump White House, a reminder that Robert Mueller was hard at work today. "The 11th Hour" back after this.


WALLACE: Breaking developments tonight in the Russian investigation. The McClatchy Washington Bureau is reporting exclusively tonight that Special Counsel Robert Mueller`s investigators are tracking down Trump business partners with Michael Cohen, a focus of their questioning. Cohen as we`ve been talking about tonight is President Donald Trump`s personal attorney and the one who paid off the porn star.

According to tonight`s report, "Armed with subpoenas compelling electronic records and sworn testimony, Mueller`s team showed up unannounced at the home of the business associate, who was a party to multiple transactions connected to Trump`s effort to expand his brand abroad." Investigators were particularly interested in interactions involving Michael D. Cohen.

Among other things, Cohen was involved in business deals secured or sought by the Trump Organization in Georgia, Kazakhstan and Russia. We`re also getting new information tonight as to the scope and status of the Mueller investigation into former Trump campaign manager, Paul Manafort.

Court documents obtained tonight reveal that a search warrant was issued that was tied to Manafort as recently as March 9th, just a few weeks ago. That makes it the seventh search warrant. The filing doesn`t say what the warrant was for.

Joining us for more, Shannon Pettypiece, White House Correspondent for Bloomberg, and from Chicago, Jill Wine-Banks, former assistant Watergate Special Counsel and an MSNBC Legal Analyst.

Jill, let me start with you, the significance of these two new glimpses into Robert Mueller`s investigation.

JILL WINE-BANKS, MSNBC LEGAL ANALYST: It`s a clear sign that he is expanding his investigation and that it isn`t going to be over anytime soon. He`s looking at business arrangements that Trump says he didn`t have in Russia, that he apparently did have and in other countries that are close to Russia.

He has also said that he is thinking about issuing some reports about the President`s conduct and his relationship to Russia, so this is going to be a very busy time for the special prosecutor and a very distressing time for the President.

WALLACE: And, Shannon, it could be a busy and distressing time for Michael Cohen, as soon as he be at the center of the Stormy Daniels story and the Mueller reporting. Let me ask you, the McClatchy report seems to build on "New York Times" reporting from last month that subpoenas had been issued to the Trump Organization as well as Washington Post reporting that Mueller`s team was looking at the Moscow hotel deal for Trump Tower in Moscow, with Michael Cohen in the middle of that. Do you have any reporting that suggests that Michael Cohen could be a subject or target of Mueller`s probe at this hour?

SHANNON PETTYPIECE, WHITE HOUSE CORRESPONDENT, BLOOMBERG: I mean, our reporting definitely indicates that the Trump Organization has been asked for documents, that they have turned over documents, that they`ve been cooperating. Our reporting also indicates that they are looking at Trump`s business. Michael Cohen, obviously, is a very integral part of the Trump Organization and the Trump business.

I can`t say whether or not at this point, he is a subject or a target or anything beyond a witness. But I can say one thing that I have heard from people. And I`ve been wondering this whole time, is there some connection between Stormy Daniels and Russia. It doesn`t seem like there is one, you know, this affair back in 2006.

But a point that was raised to me by a former prosecutor was that, to the extent that Michael Cohen did anything illegal with this payment to Stormy Daniels, violated an election law, violated an ethical rule, could be disbarred over this. It could give Mueller some leverage in some way to get Michael Cohen to either flip or to be more cooperative than he is now. So, if there is any connection between these two stories, it`s possible in that.

And so, if the noose is starting to tighten around Mueller, we could see potentially happen what happened with Flynn, what happened with Gates, where Mueller gets a little in on him and is able to pressure him into becoming, if not a cooperating witness, certainly more cooperative than he has been to this point.

WALLACE: Jill, Shannon said Mueller, I`m guessing you mean the tightening around Cohen.

PETTYPIECE: Around Cohen, yes.

WALLACE: So, Jill, I have about 47 questions off of that. Let me narrow it down to two. One, is it your guess, or hunch, or instinct that Michael Cohen could have moved from simply a witness to something more troubling for him, a subject and/or a target? And my second question, this is picking up on what Shannon said. I asked months ago what Stormy Daniels could have to do with the larger Russia question, and a former prosecutor said to me, if a porn star could blackmail him, imagine what Vladimir Putin has done.

WINE-BANKS: Well, the answer to your question is, you`re quite on target I would say. That has been a concern from the very beginning about what does Russia have that has caused the president to go so easy on them and not attack Putin or Stormy at any point. So there`s definitely a connection between them. And there`s no way that Cohen is going to walk out of this free.

It does show why the president can`t get a lawyer for the Russia case, because he throws his lawyers under the bus. That`s what he did to Michael Cohen today. So aside from the fact that he`s known for not paying people, he now is absolutely throwing them under the bus and causing them to be probably disbarred. What he did, if the President`s word is true, would clearly be illegal, but we don`t have any reason to believe that it`s true. We know that the President has a loose affiliation with truth telling, anyway. And the story doesn`t make any sense. So that may be the connection between Russia and Stormy Daniels.

WALLACE: Let me hit you, Jill. I`m so glad we have you right now, because I was just handed some breaking news from POLITICO. Let me read the headline to both of you. Mueller moves to seize bank accounts in Manafort probe. Special Counsel Robert Mueller`s office moved to seize bank accounts at three different financial institutions last year just one day before former Trump campaign Chairman Paul Manafort was indicted, prosecutors disclosed in a court filing Thursday.

The previously unknown move against the bank accounts was revealed in a list of search and seizure warrants, prosecutors submitted to a federal court in Washington after Manafort`s defense team complained that the government was withholding too many details about how the warrants were obtained.

Jill, explain this. I understand that we`re learning some of these things because Manafort is essentially, and his attorneys, are challenging the legitimacy of the scope of Mueller`s probe. But tell us if that`s the case and the significance of these revelations?

WINE-BANKS: Well, Mueller has -- not Mueller. Manafort has asked for his indictment to be dismissed and for him not to be tried because he says that the special counsel, Mueller, was appointed improperly and beyond the scope of anything that could have been properly done by the Department of Justice.

And in arguing against that and showing that he is well within the authority, given to him by the Department of Justice and specifically by Rosenstein, he has had to reveal certain authorities that he relied on. And that was the search warrants and the sources for those warrants, which have now been revealed. And they do indicate that there are a number of ongoing investigations that are not yet subjects of indictment. And they seem to be against Manafort.

So he may be in for even more indictments and a longer life sentence in jail, if he doesn`t start cooperating. So, I`d say it`s all part of a power play to get him to cooperate, and I think that you are right in saying that Cohen may be the next to flip, because of the pressure on him. And he`s going to lose his law license. He is going to lose his biggest client. And so he may have to start cooperating too.

So it`s really interesting, if you look at the answer and the case was argued yesterday in court, and the judge seemed very skeptical of Manafort`s arguments for dismissing the case. I do not think there`s any way it`s going to be dismissed and that Mueller`s authority will be upheld.

WALLACE: All right. Shannon is staying with us. We have lots more questions for her. Jill, we really needed you tonight. Thank goodness you were here. Thank you for joining us.

WINE-BANKS: Thank you, Nicolle.

WALLACE: Up next, out of Washington and unhinged, the President at an event on taxes airs all of his grievances, when "THE 11TH HOUR" continues.



DONALD TRUMP, PRESIDENT OF UNITED STATES: You know, this was going to be my remarks. It would have taken about two minutes, but, what the hell. That would have been a little boring, a little boring, right? Now, I`m reading off the first paragraph, and I said, this is boring.


WALLACE: Heaven forbid. President Trump ditched his prepared remarks today at what was supposed to be a roundtable discussion on tax reform. Instead, he bounced around from topic to topic, including immigration, voter fraud and opioids. Here`s a sampling.


TRUMP: Remember my opening remarks at Trump Tower when I opened. Everyone said, oh, he was so tough. And I used the word "rape." And yesterday it came out where this journey coming up, women are raped at levels that nobody`s ever seen before. They don`t want to mention that. These ICE guys are so much tougher than them. And they`re grabbing them by the necks and throwing them into the paddy wagons. And the town -- the people are clapping and screaming. Their towns have been liberated. It`s like it`s a war.

In many places, like California, the same person votes many times. You probably heard about that. They always like to say, oh, that`s a conspiracy theory. Not a conspiracy theory, folks, millions and millions of people.

And we got $6 billion approved towards the opioid crisis. You know, I have a friend, he goes to the hospital, he had a bad arm. He comes out, he`s like a drug addict. You get hooked and you get hooked fast.


WALLACE: So that was this afternoon. And then tonight, President Trump threatened an additional $100 billion in tariffs on imports from China. U.S. stock Futures tumbled on the announcement. Philip Bump and Shannon Pettypiece are back with us.

Shannon, I don`t really know where to start. Jeremy Bash said something on our program at 4:00, that`s as good as a weigh-in on this story as anything. Let`s watch it.


JEREMY BASH, NBC NATIONAL SECURITY ANALYST: You know, past presidents, when they kind of go off script, it kind of gives you an air of, OK, I`m going to tell you the truth. I`m going to be really straight with you. I`m not going to do what my speechwriters tell me to do.

With this president, when he goes off script, he just starts lying. The script is the only thing adhering him to anything resembling the truths. And with these, they`re not only conspiracy theorists, but they`re offensive downright lies.


WALLACE: Offensive downright lies. I wrote a quick list. He`s back to rape. He`s back to talking about the virtues of roughing up suspects. And he`s back to a conspiracy theory that was so bogus that his own White House had to abandon the investigation into the massive voter fraud that Donald Trump thought cost him the popular vote. Your thoughts?

PETTYPIECE: Well, and as a longtime business reporter, the remarks on trade, I mean, just kind of continue to drive my crazy. I mean these remarks about cars. Cars are made locally. The vast, vast majority of cars that are sold in China are going to be made in China. All of these talk about we should be shipping cars from the U.S. to China, not gonna to happen. But -- so anyway, there`s my trade tangent for you.

But -- well, let`s say --

WALLACE: Let`s stay on your tangent, because you know who agrees with you? Republican Senator Ben Sasse on the Trump tariff announcement said, hopefully the President just blowing off steam again, but if he`s even half serious, this is just nuts. China is guilty of many things but the President has no actual plan to win right now. He`s threatening to light American agriculture on fire. Let`s absolutely take on Chinese bad behavior, but a plan that punishes them instead of us. This is the dumbest possible way to do this." Do you agree, Shannon?

PETTYPIECE: Yes. The Republicans so desperately wanted this election to be about tax reform. The Republicans in the House and the Senate, they were so happy to get this tax reform bill passed. They had something to run on. They want to talk about tax reform, tax reform, tax reform. They do not want to talk about a trade war, about immigration, about election fraud and there is a faction in the White House, which includes the President, obviously, that wants to make 2018 about immigration, throw in entitlements in there too and a trade war.

And those are like the third rail of Republican politics. Nothing is going to divide the Republican Party more than immigration, for example, as we`ve seen. So the Republicans in Congress do not want the President going there but there he goes. So, you know, good luck to them, I guess.

WALLACE: And I`m guessing that the idea that the President is unshackled really is, in Jeremy Bash`s assessment, he`s simply free now to lie.

PHILIP BUMP, NATIONAL CORRESPONDENT, WASHINGTON POST: Yes. So, on the course of the campaign, there emerged this dichotomy where there was the Donald Trump we saw on Twitter and then there was the Donald Trump with staff to his telephone. And he sort of evolved into, he`d be teleprompter Trump for a while and then he grip a little bit and he comeback to the teleprompter. And that`s where he landed at the end of the campaign.

What we`re seeing now is straight Twitter Trump, right. I mean, you sit him down in front of a microphone that`s turned on and Donald Trump is going to talk about whatever Donald Trump wants to talk about. What he wanted to talk about today was anything but tax reform.

He was convinced that seems over the course of the weekend, he had dinner with Sean Hannity, sat down with Jeanine Pirro from Fox News. He watched a lot of Fox News. He became convinced that immigration for example is a key thing for him to do before the election.

Yes, the Republican Party thinks, let`s focus on tax reform. I`ll send you to West Virginia. We`re going to sit there and talk about tax reform and how good this has been for people. And not a single iota of news was made about tax reform today in West Virginia, except us saying it was at a tax reform thing that he said the rest of this.

WALLACE: Let me press you. If it`s such a good issue for him, why does he rely on lies about immigration?

BUMP: I mean, his entire campaign is predicated on the things he said about Mexican immigrants in Trump Tower, it really is. If you look at the structure of his campaign, he had his campaign launch, June 16th, 2015, made those comment about Mexico, was doing nothing for about two weeks, until Univision spoke up and said, "You know what, we`re not going to partner with you on Miss Universe anymore because of what you said." And it became this huge culture fight.

All of a sudden he had cameras on him all the time. He had this big rally in Arizona and all these people started paying attention to him. And he built up this core base of anti-immigrant Republicans that was enough to carry him through that field of Republicans, of 17 people, it carried him through. He got the nomination.

Then Republicans came home in November, that`s why he won. Because he has this core base of people who believes the things he says about immigration. And he has convinced himself, after listening to Fox News people and TV that this is the way he`s going to win again in 2018.

So let me add to your list, Shannon, of the things that the Republicans don`t want to fight about. And I think that would be while most Republicans are for -- or they used to be for comprehensive immigration reform, most of them are more comfortable sticking to the facts. It seems like the President`s hyperbolic, overheated, in my view, racist and xenophobic messages on immigration represent an even graver peril to the sustainability of the Republican brand than a trade war.

PETTYPIECE: And he does -- I mean, I certainly think immigration is a much more contentious, heated, emotional issue than a trade war, especially because a lot of these trade actions are going to take a while to shake out. And people might not necessarily feel the effects of them, you know, by November 2018, though, you know, kind of depends on how things go here.

But on immigration -- the thing is that, it`s not like he doesn`t have a good story to say about immigration. He could hammer away on immigration, talk about border crossings being down, talk about the wall, talk about, you know, employment up, you know, because there`s fewer immigrations.

I mean, there is a case we can make about immigration that doesn`t have to rehash the Mexican rapist comment. It`s like why go back there? But, I mean, his instincts are as they have been, where there`s a place where most people would not want to go back, and say that didn`t work out that well for me the first time. His instinct is double down on it.

And to Phil`s point, lot of people would say that wasn`t smart move but there was, you know, did light a fire under a lot of his supporters that, you know, propelled him in the last election, so right, why not do it again.

WALLACE: Why not. Shannon Pettypiece and Philip bump, thank you.

Coming up, the President continues his attacks on Amazon and its boss, Jeff Bezos, a reminder of just how far we are from normal with Jon Meacham when "THE 11TH HOUR" continues.


WALLACE: Donald Trump`s feud with Amazon continues. He repeated his accusations late today that Amazon is not paying enough in taxes and it is causing the U.S. Post Office to lose money.

The Washington Post which is owned by Amazon`s founder, Jeff Bezos, points out, quote, some of Trump`s aides and allies say his beef with Amazon stems from Trump`s lifelong rivalry with billionaires who surpass him on the list of planet`s richest people. But their reporting also identifies the bigger shift in America, besides how unusual it is for American president to attack an American company.

Writing, "Trump`s decision in recent days to zero in on Bezos and as his latest Twitter targets, has highlighted a severe fracture in American society. The divide between concrete and steel and zeros and ones, a split that is much philosophical as it is economy, as much about the fraying of communities as it is about the shape of commerce."

Joining us to talk about it, Pulitzer prize-winning author and historian Jon Meacham. His upcoming book, "The Soul of America: The Battle for Our Better Angels", must read in these days, the new chicken soup for your political souls.

Just weigh-in on how weird it is to be going after an American company that employs, I believe, more than 500,000 American citizens.

JON MEACHAM, PRESIDENTIAL HISTORIAN & AUTHOR: Well, presidents by and large, and large is the key word there, don`t target individual corporate entities. We have had moments were presidents have to deal with strikes, they had to deal with industry-wide crises, Truman and steel, Kennedy and steel.

But this is very different. And I think the other element to the whole story, obviously, is that the president either has confused or is willfully confusing the fact that Jeff Bezos owns the Washington Post. And in that sense, the analogy that immediately comes to mind and it`s been at the treater recently, is Richard Nixon, who went to Washington Post, began to get close both on the Pentagon papers and then later on Watergate, used to mused about threatening the Post company with yanking TV station licenses, trying to attack a free press by using the means of the market.

And that`s basically what`s going on here, and that`s why it`s even more pernicious, I think, than a basic kind of I`m a real estate developer. I want to build bricks and mortar stores and e-commerce is destroying that. I think this is about Trump`s belief that the Post that Silicon Valley. That this is part of at least an adjunct of the fabled deep state he believes is against him.

WALLACE: Let me put up this partial list of the companies that we found in a cursory look that the president has attacked, Boeing, ABC, CNN, Comcast, NBC, CBS, Delta, Facebook, the NFL, Nordstrom, I mean, the list goes on and on. Let me ask a question that I know Brian flips to you often, how far from normal is a list like that?

MEACHAM: How far can Boeing fly us? Are we under the Delta brand to mix it all up? You know, we`re just -- it`s -- we`re off on Prospero`s Island in "The Tempest". We`re just far away from civilization, and kind of hoping that some, you know, a band of civilized people shows up at some point.

WALLACE: Let me press you on the band of civilized people. I mean, Larry Kudlow is the brand new adviser, he comes from one of the companies on this list. Is it clear either that people like Larry Kudlow are completely impatent as White House advisers or do they become complicit in the takedown of American industries?

MEACHAM: You know better than I do, because you served in the White House, how difficult it is once you are actually in the West Wing, standing in the Oval Office, thinking you want to tell the president what you really think, and the cultural reality of that office, the cultural reality of speaking to the most powerful person in the world, checks even the most candid people.

I don`t know Mr. Kudlow well, I wish him well, but history does not suggest, to put it very mildly, that advisers going in to tell Donald Trump where he`s wrong and how he could do things better works out very well. I just don`t see how -- I think we tend to, little bit like Lucy and the football, we tend to think, well, Kelly is going to do this at last, right, or Priebus comes from RNC, maybe he can do it, or maybe now it will be Kudlow.

Here`s the problem. Problem is named Trump, kind of full stop, right there. And it`s -- and I don`t think it`s going to change.

WALLACE: I think you`re probably right. And that`s the perfect place to start. Jon Meacham, thank you so much for ending us on that note.

Before we go, though, a few programming notes. Tomorrow night a special MSNBC and Recode town hall event with special guest Tim Cook, the CEO of Apple. It`s called "Revolution: Apple Changing the World", start at 8:00 p.m. eastern on MSNBC. And on Sunday, join me for special edition of headliners featuring an in-depth look at man we talk about so many nights around here, Robert Mueller. I`m back tomorrow and every week here at 4:00 p.m. right here on MSNBC.

That`s our broadcast tonight, thank you for being with us, and goodnight from NBC News Headquarters in New York.