Full Episode: President Trump rattles global markets and cracks down on immigration, EPA chief’s future remains uncertain

ROBERT COSTA: President Trump rattles global markets after threatening China with billions in new tariffs. I’m Robert Costa. U.S. troops head to the border and the embattled EPA chief fights to keep his job, tonight on Washington Week .

Trade war.

PRESIDENT DONALD TRUMP: (From video.) You have to go after the people that aren’t treating you right.

MR. COSTA: President Trump calls for an additional 100 billion (dollars) in tariffs on Chinese goods, escalating the dispute between the world’s two largest economies. Plus –

EPA ADMINISTRATOR SCOTT PRUITT: (From video.) This president has shown tremendous courage to say to the American people that America is going to be put first.

MR. COSTA: Will EPA Administrator Scott Pruitt’s unwavering support for the president help him weather a storm of ethics controversies?

ED HENRY (Fox News): (From video.) Are you embarrassed?

MR. COSTA: Questions keep mounting about his housing arrangement, first-class travel, and staff management. And President Trump returns to his campaign pledge to crack down on undocumented immigrants.

PRESIDENT TRUMP: (From video.) We cannot let people enter our country we have no idea who they are, what they do, where they came from.

MR. COSTA: And orders the deployment of National Guard troops to the U.S.-Mexico Border.

PRESIDENT TRUMP: (From video.) Until we can have a wall and proper security, we’re going to be guarding our border with the military. That’s a big step.

MR. COSTA: We discuss it all with Kayla Tausche of CNBC, Michael Scherer of The Washington Post , Geoff Bennett of NBC News, and Susan Glasser of POLITICO .

ANNOUNCER: This is Washington Week . Once again, from Washington, moderator Robert Costa.

MR. COSTA: Good evening. Another volatile day on Wall Street after President Trump stood by his threat of new tariffs on $100 billion in Chinese imports. The stock market, it plunged on these trade fears and a weaker-than-expected jobs report. Despite the unrest, Mr. Trump defended his decision during a radio interview on Friday.

PRESIDENT TRUMP: (From recording.) We’ve already lost the trade war. We don’t have a trade war; we’ve lost the trade war. But the easiest thing for me to do would be just to close my eyes and forget it, and if I did that I’m not doing my job. So I’m not saying there won’t be a little pain, but the market’s gone up 40 percent, 42 percent. So we might lose a little bit of it, but we’re going to have a much stronger country when we’re finished.

MR. COSTA: The standoff comes after China proposed 50 billion (dollars) in tariffs on a variety of U.S. goods, including beef, pork, and soybeans and wheat, as well as airplanes and cars. Kayla, the administration, in spite of all what happened today with the market – we watched it all day, watched your reporting – they’re still standing by their position. Why?

KAYLA TAUSCHE: Well, they believe that this is what will bring China to the table. The president’s Cabinet and his economic advisors have defended the president and said he’s the first president to actually stand up to China, to do what no one else has. But then other people – outside advisors, corporate executives – are saying we don’t really see how there’s an endgame here. We don’t see how this gets resolved. And you had – you had a couple people – Larry Kudlow, Steve Mnuchin, the Treasury secretary – today talking about potential negotiations with China, but saying that they’re not going on right now, that they refuse to actually say when they are happening, what they are talking about, where things stand. And that’s something that the markets didn’t like, because they want this to get resolved behind the scenes. They don’t want these tariffs to come into effect.

MR. COSTA: That’s a good point, Geoff, because when I talk about the administration I should probably be careful. The president says one thing, Larry Kudlow, the White House’s new economic director, he says another thing. Who actually is speaking for the administration? Is it Kudlow with this reassurance to the markets that it’s not really tariffs yet, or is it the president?

GEOFF BENNETT: Good question. I mean, there appears to be sort of a good cop/bad cop strategy here. I was at the North Lawn of the White House when Larry Kudlow this morning was giving interviews to all the big cable networks, just as the markets were opening, doing his level best to really – to sort of tamp down fears of a trade war, suggesting that these tariffs might not ever take place.

But I was talking to somebody who’s known the president for a while and says that the way the president is approaching these negotiations reflect the way he’s approached negotiations his entire adult life. He talks tough, he starts negotiating from an extreme position, he expects the opponent to ultimately give in. But in this situation, it’s not clear how or whether China will ever give in. It’s not entirely clear what a win looks like. And in Chinese President Xi Jinping you have someone who’s effectively president for life. So he could continue this rhetorical trade war indefinitely.

MR. COSTA: What to make of China’s position here? They called the U.S. arrogant today in a statement from the ministry of commerce. They’re not pulling any punches.

SUSAN GLASSER: Well, that’s right. I think it’s super significant that there are not actually any negotiations already underway, first of all. Second of all, the Chinese, it seems to me, are playing this pretty savvy when it comes to American politics, right? They have tried to – in their response to President Trump’s initial round of proposed tariffs – they’ve tried to go into the United States and respond with things that are maximizing pressure on Trump from within his own party. The American farm belt, the Chinese have, I think smartly calculated, voted overwhelmingly for Donald Trump. Their hope and calculation is that the potential pain hitting American food producers, hitting the American farmers will cause them to put pressure on Donald Trump.

You saw that already happening, by the way, with Republican Senator Joni Ernst from Iowa. Not known as a big opponent of Donald Trump, coming out yesterday saying: I called up the president. I said: This is not a good idea. And I think it’s really interesting. The Chinese are learning to play American domestic politics.

MR. COSTA: Well, you reported on this, Michael, this week. Are the congressional Republicans actually going to push this administration around?

MICHAEL SCHERER: You know, they’re not just going after the farm belt. They’re microtargeting some of these tariffs on specific congressional districts. You look at the middle of Washington state. They make cherries, pears and apples. That was on the initial list of tariffs. You look at the central valley, almonds big business. You know, the prices are going to be set in a few weeks. They went after almonds. Iowa’s huge and the whole Midwest – pork, soybeans. You know, the politics of this domestically are rather complicated. You have Chuck Schumer coming out saying: I actually think this is a good thing. We have to stop being pushed around by China. You had Mitt Romney today, you know, traditional conservative running for Senate in Utah, say also that he thinks this is a good thing as an opening gambit.

Everybody’s just playing this as a bluff though at this point. No one knows who’s going to blink. The Chinese have two big advantages. One, it’s an authoritarian regime. They don’t have to worry about these political factors, whereas Trump does. And, two, they’ve – Trump has yet to sort of rally the world around his cause. The U.S. is sort of acting unilaterally here. And China keeps dressing itself in the language of the international order, which is going to make it harder.

MS. TAUSCHE: I think Congress feels a little powerless as well, because last year they were able to focus singularly on tax reform, take the president’s mind off trade. They called a truce on the hardline on trade rhetoric during that time so that they could get everyone rallied around that one issue. After tax reform got passed, you saw GOP senators and members of the House coming to the White House in droves to try to lobby the president not to do exactly what he’s doing now. And the president sat there, and he listened. And you had people like Chuck Grassley, like Joni Ernst, like Pat Roberts of Kansas, saying: Please don’t do this. This will come back in revenge that is exacted on my district, on my state. And the president did it anyway.

MR. COSTA: What’s next, though, Kayla? Is it going to be a bilateral negotiation between the U.S. and China? Or does the World Trade Organization step in and try to mediate?

MS. TAUSCHE: Well, we have a few weeks here. I mean, the Office of the U.S. Trade Representative has left an open window here. Ambassador Lighthizer has been very careful to say nothing’s in effect and won’t go in effect for at least a couple of months at this point. So we’re looking at late May that the administration has to either meet with China or figure out a way to resolve this through appropriate global trade channels. But China has a lot of very powerful tools in its tool chest that it hasn’t used yet. And so if the U.S. continues talking tough, China won’t back down.

MR. COSTA: It’s not just talking tough, in a sense. That’s part of it, on the trade aspect. Politically, though, the president just keeps wanting to go back to his campaign pledge.

MR. BENNETT: It’s a great point. And I think Kayla makes a great point, that we’re going to hear the president talk more about trade. I spoke with someone who’s familiar with the president’s thinking in this midterm election year. And this person said: Expect to hear the president talk a lot about the tax cuts, of course, trade, and immigration – in part, because the omnibus bill that he signed, I guess two weeks ago now, was the last big legislative item that this Congress will probably pass in this election year. And there’s no – there’s nothing left on the Trump legislative agenda. So in many ways, there’s this vacuum here and he’s filling it with talking about the very same things that made him effective as a presidential candidate.

MR. COSTA: There’s a lot more filling the vacuum this week. We have trade, but we also have more turmoil inside of the administration. President Trump said today on Twitter that EPA Administrator Scott Pruitt is doing a, quote, “great job but is TOTALLY under siege.” That statement left Pruitt – embattled by a barrage of reports on potential ethics violations over his housing, travel, and security expenses – hanging on to his Cabinet post, for now. Pruitt, has been scrutinized daily this week amid a flurry of headlines about his conduct, from his $50 a night condo deal from an energy lobbyist spouse, to first-class travel, and unrest on the EPA staff. As all these stories piled up, Pruitt took to Fox News to defend himself.

MR. HENRY: (From video.) President Trump said he would drain the swamp.

MR. PRUITT: (From video.) I don’t –

MR. HENRY: (From video.) Is draining the swamp renting an apartment from the wife of a Washington lobbyist?

MR. PRUITT: (From video.) I don’t think that that’s even remotely fair to ask that question.

MR. HENRY: (From video.) OK, so why did you then accept $50 a night to rent a condo from the wife of a Washington lobbyist?

MR. PRUITT: (From video.) Well, let’s talk about that. That is something that, again, has been reviewed by ethics officials here. They’ve said that it’s market rate.

MR. HENRY: (From video.) You’re renting it from the wife of a lobbyist.

MR. PRUITT: (From video.) Yeah, who has no business before this agency.

MR. COSTA: Pruitt also reportedly bypassed the White House and used an obscure rule to secure tens of thousands of dollars in pay raises for two senior advisors, advisors he has known for years. And The New York Times reported the he asked a security detail – no joke – to flash the lights last year to get through traffic in Washington on the way to dinner at Le Diplomate, one of those French restaurants on 14th Street. Susan, amid all this, he survives.

MS. GLASSER: Well, that’s right. Listen, if anybody would be immune to firing somebody because they overly enjoyed the perks of their office, it might be Donald Trump. But there’s a substantive issue as well. Pruitt has a lot of defenders among Donald Trump’s conservative supporters. He is perceived as really carrying out the ideological agenda of the administration. He has been a particular favorite of the right, even predating his tenure in Donald Trump’s Cabinet. And so I think Trump is reluctant on substantive grounds to fire him.

He’s also – he’s got that contrary streak in him. Remember a few weeks ago when The Washington Post reported that H.R. McMaster was on his way out. Donald Trump was already planning to fire H.R. McMaster at this period of time. But he didn’t like The Washington Post revealing that before he was ready to do it. He still did it, right? He went ahead and dumped him anyways. But he didn’t want to do it right away.

So are we looking at a situation where perhaps the coverage of this and the burgeoning scandals around Pruitt have just extended his life in the Cabinet by a few additional days? Or is it a situation where Trump really just doesn’t want to get rid of him? Reading the Kremlinology, I actually found it fascinating today, there were not one but two stories – one in The New York Times and one in The Wall Street Journal – saying that White House Chief of Staff John Kelly had urged President Trump to dump Pruitt. And Trump was still resisting. To me, that seemed like really undercutting John Kelly. So maybe his is the job that’s on the line.

MR. COSTA: Everyone says their job’s on the line in this White House when you’re up at 1600 Penn.

MR. SCHERER: And very often there are reports of your demise multiple times before your demise finally comes. So I don’t think Scott Pruitt’s quite sleeping well having gone through this week. And it’s also possible that more stories come out. You know, there are a lot of reporters working on stories about Scott Pruitt now because there is obviously so much there to dig into. And I don’t think we’re done with that.

The other thing, though, the president has to worry about is how do you replace probably the most controversial head of an agency, the EPA? He got through with 52 votes when he was first in the Senate, when he was first confirmed. But you’ve lost one of those Republican senators. Another Republican senator –

MR. COSTA: Do they even have time? Do they even have time in the Senate?

MR. SCHERER: Well, that too. And another Republican senator, John McCain, isn’t voting right now. So they may not be able to confirm somebody, which may be something that extends his life as well.

MR. COSTA: Business likes Pruitt. When you talk to people on Wall Street, because of all the regulations he’s cut away there’s not only support among the movement conservatives, as Susan was talking about, but the business community.

MS. TAUSCHE: And the president is in touch with executives from the oil and gas industry, the mining industry, the companies that are feeling the benefits from the deregulatory agenda that Pruitt is leading. The president talks to them a lot. He hears that those companies like what’s Pruitt – what Pruitt is doing and that’s what informs his view of Pruitt. If you look at the White House’s own dashboard on how agencies are doing in deregulating their own industries, the EPA is right up there with some of the highest-volume rollbacks of any agencies in the government, and that’s something that, you know, you hear the administration talking about quite often. But the White House said they’re investigating this and there could be a situation where whatever they find could be impermissible.

MR. COSTA: Geoff, you were at the White House all day. What did you make of the Pruitt visit to the West Wing for a meeting with the president and, as Susan mentioned, the advice from General Kelly last week to get rid of Pruitt?

MR. BENNETT: That’s right, General Kelly and other top White House aides, we’re told, have told the president that it’s time for Scott Pruitt to go. The president apparently thinks otherwise. And I think the implicit and perhaps troubling takeaway is that for all of these sort of ethical issues, as long as a Cabinet member stays in the president’s personal good graces, a lot seems to be overlooked. So the president will certainly have to account for that.

MR. COSTA: We’ve seen Ben Carson have trouble, the secretary of housing and urban development. A lot of these outsiders who come to Washington and they join the Cabinet, and they don’t realize – and reporters realize it because you cover an administration – everything that’s public information gets covered, but a lot of these officials come in at these – in these big jobs and they don’t realize every part of the budget is under scrutiny.

MR. SCHERER: Well, the other interesting thing is that, you know, a lot of times in government people take their cues from the person above them. And, you know, President Obama ran a pretty frugal, straightforward operation. You notice a lot of these scandals – first-class airfare, private planes, redecorating the office – I mean, those are the kind of things that echo the lifestyle, the life that the president lives. And so I think a lot of people came in thinking, well, look, I’m now the head of an agency, I shouldn’t have scuffs on my desk, I shouldn’t have a torn carpet; you know, if I have to fly overnight, I should be flying first class. And that’s what’s now getting them in trouble.

MS. TAUSCHE: But you don’t have those headlines from the members of the Cabinet who are independently wealthy. You don’t have those headlines about Betsy DeVos, about Wilbur Ross, about Steven Mnuchin. You only have it from the people who are either career government officials or who, you know, had perfectly affluent lives, but perhaps not to the level of some of the other people that they’re sitting around the table with.

MR. BENNETT: And don’t forget it was just a few weeks ago that Chief of Staff John Kelly brought together the group of misbehaving Cabinet members and basically told them to get their acts together and that they should, you know, be more responsible in the ways they run their agencies and with their travel expenses.

MR. COSTA: But the president is digging in on Pruitt, at least – it’s Friday night; we’ll check our phones after the show, maybe something has changed. (Laughter.) But for now he’s there. The president’s digging in on a lot of things this week – another front, immigration. Mr. Trump has ordered 2(,000) to 4,000 National Guard troops to secure the U.S.-Mexico border and beef up customs and border enforcement. The president literally threw out his prepared remarks at a West Virginia roundtable this week where he was scheduled to talk about his tax overhaul. Instead, he seized on illegal immigration.

PRESIDENT TRUMP: (From video.) And remember my opening remarks at Trump Tower when I opened? Everybody said, oh, he was so tough, and I used the word “rape.” Women are raped at levels that nobody’s ever seen before. They don’t want to mention that. So we have to change our laws.

MR. COSTA: Deploying the National Guard along the border is not unprecedented. President George W. Bush and President Barack Obama both did it in two operations that cost a total of more than 1.3 billion (dollars). Critics called those deployments costly and inefficient. Michael, you cover the president on the campaign trail, again this week coming back not only to the trade issue but to immigration. What is going on at this presidency at this time?

MR. SCHERER: I think, you know, when the president won election, if you actually go back and look at that first 60 Minutes interview and he’s talking about how he’s now going to be the president, you can almost see in his face that he was nervous about it. And I think it was very evident in those first few months that he wasn’t sure he knew how to do the job, he was worried about the burden that had been put on him, and he surrounded himself with a group of advisors he’s never been happy with. And now this latest generation has kind of gone out the door, and I think the president feels – as he’s felt all through his life and career – that in moments like this he should go back to his gut instinct, and that’s what he’s doing. And we’re, as you said, entering an election season. Legislating is done. He’s trying to get back on message. He has to get Republicans excited to vote if there’s going to be hope in the fall, and he’s taking a gamble here.

MR. COSTA: And it’s about that core base voter, and when you think about it it’s also about the media that base watches. So much of this was driven by conservative media this week and the coverage of Central American migrants moving up through Mexico and the way that was covered on the right, the way the White House watched it. But it was – it was factually under a lot of the – under the spotlight this week as well.

MS. GLASSER: Well, that’s a very charitable way of putting it. I mean, let’s be real: Like, there was no crisis. This is a literally brought to you by Fox News crisis, OK? This is, you know, they covered a caravan of immigrants that was supposedly on its way to invade and rampage in the United States. Donald Trump is ordering troops to the border in response to a manufactured, not real, crisis. Now, in the past you talked about both President Bush and President Obama have had to at various points, in response to real events, order National Guard troops to temporarily go to the border. So this is – it’s ersatz in every possible way. So I find that to be – it’s basically a real metaphor for the politics that we’re living in right now. You know, you see President Trump throwing up the papers; to me, that’s like the signature visual of the presidency. Like, ah, this script is boring; OK, I’m going to offer you a new immigration-related plotline.

But I want to go back to this idea that he’s in campaign mode, which I think he really is. I mean, he feels untethered or he’s out there doing what he wants to do, having the Cabinet I’ve wanted to have, having the presidency I want to have. What I’m struck by is that he’s still treating it as a reality show or as if everything is a campaign. Actions do at some point or another have consequences. In Mexico this week, in response to this manufactured-on-TV crisis, you saw the president of Mexico, after two years of forbearance, actually give an address to the Mexican people and say enough is enough, basically: Donald Trump, if you want to talk about American domestic politics, you should do that and leave Mexico out of it. He may lose his job in the July 1st Mexican presidential election because of the American politics here.

MR. BENNETT: And to Susan’s point, the president – this crisis wasn’t just brought to us by Fox News – you’re totally right about that – it was also brought to us by the president’s friends and allies who were in his ear at Mar-a-Lago last weekend, folks like Corey Lewandowski, Judge Jeanine Pirro, Sean Hannity, conveying the message, we’re told, that the base was growing impatient and softening with the president’s perceived, I guess, giving in on immigration. Remember, he signed that omnibus bill that didn’t have the full funding for the – for the border wall, and he was very upset about that. And so that is what prompted what we’ve seen this past week in many ways.

MR. SCHERER: You know, he’s –

MS. GLASSER: By the way, Mexico is not going to pay for the wall.

MR. BENNETT: That’s right.

MS. GLASSER: You know that, right?

MR. COSTA: Are congressional Republicans going to back up the president here and change their tune to immigration, immigration ahead of the midterms, or they – were they – would they rather sell the tax cut?

MS. TAUSCHE: I think they’d rather sell the tax cut. I think that there is still confusion about exactly what type of immigration plan would pass Congress the White House would sign off on. And at this point there is the absence of a deadline, which as we know is what really lights a fire under Congress and causes them to act.

MR. SCHERER: The real problem the president has in the midterms is that the people who elected him in 2016 are not going to decide who controls Congress. These are different districts that matter in this election. They are moderate House districts in suburban areas. There are a couple rural red-state areas. But there are like 54, 50 districts that are not depressed working-class parts of Michigan or Pennsylvania that were the ones who delivered him the White House. So he has the same playbook, but he’s not playing the same game, and it’s not clear whether he won’t do more damage to a lot of – a lot of these candidacies if he pursues this path.

MR. COSTA: And he keeps talking about voter fraud as well with immigration, the president.

MR. BENNETT: He does, but again, his own commission that was formed to look into voter fraud disbanded finding no evidence that it ever existed.

MR. COSTA: So where do we – where do we see this president going next? Does this just become more campaign mode the whole time?

MS. GLASSER: Well, it’s a really good question if there’s not really a legislative agenda. First of all, Michael’s point is a really important one. What districts is Donald Trump going to be welcome in to campaign?

MR. COSTA: Well, he went to West Virginia this week, so at least West Virginia.

MR. SCHERER: He can always go back. (Laughter.)

MR. COSTA: He can always go back to West Virginia, wild and wonderful West Virginia. I love it. We’re going to have to leave it there tonight. Thanks, everybody.

We’ll discuss President Trump’s battle with Amazon – another battle – in the webcast. You can find that later tonight and all week long at PBS.org/WashingtonWeek.

I’m Robert Costa. Thanks for joining us.