Special: Rep. Chris Collins charged with insider trading

ROBERT COSTA: Hello. I’m Robert Costa. And this is the Washington Week Extra , where we pick up online where we left off on our broadcast.

Joining me around the table, Sheryl Gay Stolberg of The New York Times , Kimberly Atkins of The Boston Herald , Philip Rucker of The Washington Post , and Jake Sherman of POLITICO .

Republican Congressman Chris Collins of New York was indicted on insider trading charges Wednesday. The charges allege he was heavily invested in a drug company with a single product and he got information that had – that an experimental drug had just failed a scientific trial. And according to the indictment, the congressman quickly contacted his son and set off a chain reaction of friends and relatives who were also heavily invested, all of whom sold their stock before that failed test was made public and the stock prices dropped. Congressman Collins did not sell his stock and has pleaded not guilty to breaking any laws.

REPRESENTATIVE CHRIS COLLINS (R-NY): (From video.) The charges that have been levied against me are meritless, and I will mount a vigorous defense in court to clear my name.

MR. COSTA: Collins sat on the House committee overseeing health care companies and was also a member of the board of the drug company in question. The case raises, as you would expect, many questions about the ethics of such practices. And the bigger picture: it could give ammunition to Democrats ahead of the midterm elections. Collins was the first member of Congress, if you remember, to support Donald Trump in 2016, and he’s also up for reelection. Jake, I remember you were reporting on hearing Collins talk about insider trading months ago.

JAKE SHERMAN: He talked about, to be clear, how many millionaires he had made in Buffalo, where he –

MR. COSTA: What was he talking about there?

MR. SHERMAN: He could explain that. I’m sure he’ll have ample opportunity. Listen, this is a really dangerous situation for Collins. It’s very clear that he was on the board – everything seems plausible. Obviously, he has indicated he’ll hire very good attorneys to fight it, but on the political angle there’s no question about it: Democrats are going to use this against Republicans writ large. And there are serious questions that have nothing to do with the insider trading angle, which is should members of Congress be serving on boards of public companies, which seems – and we reported this morning he was on four other boards as well. So it would seem to be some sort of corporate misconduct. I mean, he has a full-time job as a member of Congress; how could he devote time to being a director of public companies? It seems – seems off.

SHERYL GAY STOLBERG: Right. So in the Senate this is actually barred under the ethics rules, and there are already a couple of House members – I talked to one of them, Congresswoman Kathleen Rice from New York, today, who is preparing a resolution to bar lawmakers from serving on corporate boards, and she thinks it’s a clear conflict of interest. And I think, frankly, that’s almost the – it’s equally shocking as the insider trading charges are that you can sit on a board that –

MR. COSTA: Why is that?

MS. STOLBERG: You’re asking me? I don’t – I didn’t write the rules.

MR. SHERMAN: And he did regulate –

MR. COSTA: It’s a surprise to a lot of people.

MS. STOLBERG: It is a surprise to a lot of people. And I tried to find out how widespread this is, and it’s not a very easy thing to find out. You’ve got to look at the financial disclosure records of each House member one by one. There’s no searchable database, so it’s a very time-intensive endeavor. But we do know that at least we have an N of one – one congressman did this, and it’s raising a lot of questions.

MR. COSTA: Is there pressure on Collins to resign?

MR. SHERMAN: There aren’t many tools at the Republican leadership’s disposal. I was talking to a leadership aide over the last couple days who said, yeah, I mean, eventually he probably will have to go, but there is precedent. Many Democrats have served in Congress, even have run for reelection, and even have won under federal indictment. Bob Menendez comes to mind.

MR. COSTA: And he survived – Menendez survived, the New Jersey senator.

MR. SHERMAN: He did. And Chaka Fattah, a congressman from Philadelphia, was under indictment, now is in prison, no longer in Congress. So there is precedent for this. But the politics of it are quite bad and there are these lingering questions, which is how could somebody who’s overseeing the pharmaceutical industry – how could that person then serve on a board of a pharmaceutical company that trades on public equity markets? It’s a big question.

MR. COSTA: He was a major ally – is a major ally of President Trump.

PHILIP RUCKER: He is. He was the first congressman to endorse President Trump. He’s been close to the Trump campaign during the campaign. He was close to the Trump orbit during the transition. He’s not been as close to the White House in recent months, perhaps because people in the administration knew something might have been afoot; I don’t know. But we have not seen him in the White House. You’ve not seen his sort of allies taking jobs in the administration. But he was a very clear supporter and, importantly, he represented a part of New York where a lot of Trump voters were. There was strong support for Donald Trump there.

KIMBERLY ATKINS: Yeah. I mean, and look, will this backfire on President Trump in some way? Perhaps, perhaps not. I mean, President Trump’s campaign chairman is on trial right now, so I don’t know how much that is going to stick to him. It’s really not going to –

MR. RUCKER: It’s not going to.

MS. STOLBERG: We haven’t seen a lot backfire on President Trump.

MS. ATKINS: No, we have not, so –

MS. STOLBERG: Or candidate Trump, for that matter.

MS. ATKINS: That’s the one –

MR. COSTA: That’s a good point. The Manafort trial is ongoing, and we’re wondering does Collins play. You would think the campaign chairman would matter more than someone who had endorsed the candidate.

MS. ATKINS: Right, and that hasn’t seemed to erode at least not his core base support yet.

MR. COSTA: But as we talked about in the show, it feeds into this idea, whether it’s Pruitt or Collins or Wilbur Ross, the commerce secretary, getting in some hot water for his own trade, it feeds a certain narrative.

MS. ATKINS: It does, and it helps Democrats if they want to push that story. And we don’t know what the tipping point may be. That is an awful lot of people in President Trump’s orbit. Perhaps when they start perhaps going to jail that might change things.

MR. COSTA: Candidates and potential candidates flock to state fairs in election years in every state. The Iowa State Fair has launched many a presidential campaign, and this week there were a few names at the event, and one name in particular who we’re paying attention to. Michael Avenatti, he is known to many Americans as the lawyer representing adult entertainer Stormy Daniels in her case against President Trump. Now Avenatti says he’s exploring a run for the presidency of the United States. People chuckled when President Trump, then-candidate Trump, a reality TV show star, got in in 2015. A lot of chuckles about Avenatti this week, but in an age where populism is rampant, celebrity matters, a Democratic Party that’s divided, should we be giving it a serious look or at least a consideration?

MR. SHERMAN: Yeah, I think that we probably should. He could catch fire. One thing that he said that was in the Des Moines Register this morning in an interview he did with the Des Moines Register in Iowa – one thing he said really caught my ear, which was the Democratic Party is looking for a fighter; we don’t have a fighter. I don’t think he said we don’t have a fighter, but he – the implication was that he’s a fighter, and I think that’s an attractive message for somebody.

MR. RUCKER: Absolutely.

MR. SHERMAN: I really do. And clearly he’s being taken seriously because he has a former Hillary Clinton top aide escorting him around Iowa, so. (Laughs.)

MR. COSTA: Matt Paul.

MR. SHERMAN: Matt Paul, who ran Hillary’s campaign in Iowa. So you have to think that this guy is for real.

MS. ATKINS: And with a – with a race so wide open at this point and what very well could look like the Republican primary last time, with, you know, more than a dozen people in the sphere of 2020 speculation, if he comes out early with that kind of a message, why wouldn’t he catch fire? No longer is the fact that he represents porn stars – (laughs) – something that would have been political poison just a few years ago – I don’t think that’s the case anymore.

MS. STOLBERG: I was going to say the other thing that’s really interesting about Avenatti is he has a masterful command of the media and the news cycle.

MR. SHERMAN: Like someone else we know. (Laughter.)

MS. STOLBERG: Exactly, like someone else we know. So he is somehow able to game out when he should do an interview, when things are popping, when will he have an opening. He’ll monitor Trump’s tweets. And look, that’s a quality that President Trump has shown can work on the campaign trail.

MR. RUCKER: And Jake mentioned he thinks Democrats want a fighter, and I think he’s right about that. But he’s – Avenatti is not just any kind of fighter; he is a – he is a unique brawler. He knows how to manipulate Trump and he understands the Trump psychology better than I think a lot of the other Democratic potential candidates. He gets Trump, he knows how he thinks, and he knows how to get under his skin as you were saying, Sheryl. And I think that in a field of potentially, you know, 10, 15, 20 Democratic candidates, where most of them are senators or governors and doing talking points, if he’s up on that debate stage you could really see him popping and standing out with something a little different.

MR. COSTA: President Trump, Phil, has opinions about almost everyone, yet he’s pretty quiet about Avenatti. Why?

MR. RUCKER: I don’t think he’s said anything about Avenatti, certainly no nicknames that we know of. What could it be?

MS. STOLBERG: Yeah, what’s the nickname going to be? (Laughter.)

MR. COSTA: Is it just because of the legal proceeding, or?

MR. RUCKER: You know, I don’t know. He certainly has paid attention to Avenatti. He’s been bothered, clearly, by his clients and by this campaign to bring Stormy Daniels into the public consciousness. But I really don’t know. It might be a little bit of trepidation, sort of not really sure how to handle Avenatti because he’s such a character.

MR. COSTA: I spoke to the head of the Iowa Wing Ding – that’s the event where Avenatti spoke Friday – and he said, look, Tim Ryan, a congressman trying to maybe run for president, he’s there; John Delaney, congressman, Democrat, also trying to think about running – or he’s actually already formally running, John Delaney.

MR. RUCKER: The first candidate.

MR. COSTA: First candidate. Yet, Avenatti’s the headliner. And it makes you wonder, where is Vice President Biden, who’s thinking about it too? Where is Senator Warren? Why aren’t they in Iowa right now?

MR. SHERMAN: That’s a good question. I think Vice President Biden feels like he could take his time because top-tier candidates typically feel like they could take their time to announce and kind of see where the field is and see where the openings are. I don’t think that’s the reality – the reality anymore, and I’ll tell you why. As somebody who spends a lot of time in the Capitol I hate to say this, but members of Congress are not the most enthralling people. They’re not really that exciting. (Laughter.) Tim Ryan, nice guy, I’m not – you know, he’s not anything – he’s not a bad person, but I don’t – Michael Avenatti’s far more exciting than a member of Congress, has a lot more interesting of a story potentially than a member of Congress who’s been toiling away on the Ag Committee or toiling away on the Energy and Commerce Committee.

MR. COSTA: It’s interesting, you see Tim Ryan trying to get some traction. He’s talking about legalizing marijuana. He talks about meditation as a way to reach out to Millennials.

MR. SHERMAN: Yoga, right.

MS. STOLBERG: Yeah, yoga. He’s going to get the yoga voter. (Laughter.)

MR. COSTA: They’re out there.

MS. STOLBERG: Yeah.

MR. RUCKER: And Democratic activists, I think right now they want somebody leading their party who’s taking it to Trump every day, who’s fighting Trump right now. There are some lawmakers who are doing that. You see Senator Kamala Harris do it a little bit. But I don’t think there’s a lot of appetite or patience for someone like Vice President Biden, who’s been kind of hanging back and observing from home and waiting to pick his shots. They want somebody in the ring trying to discredit the president today and every day.

MR. SHERMAN: Next generation, too. Can’t discount that.

MR. COSTA: Another tell-all book’s coming out about President Trump. It’s about to hit shelves pretty soon, in the next few days. Omarosa Manigault Newman, who met Mr. Trump when she was a contestant on The Apprentice , has written Unhinged – that’s the title – an insider account of Trump’s White House. In it, Omarosa depicts Mr. Trump as a racist. White House Press Secretary Sarah Sanders released this statement. Quote: “Instead of telling the truth about all the good President Trump and his administration are doing to make America safe and prosperous, this book is riddled with lies and false accusations. It’s sad that a disgruntled former White House employee is trying to profit off these false attacks, and even worse that the media would now give her a platform, after not taking her seriously when she only had positive things to say about the President during her time in the administration.” And my colleague Josh Dawsey at The Washington Post broke the story Friday that after Omarosa was fired she was offered a $15,000-a-month job in exchange for her silence. A long statement, Phil, from Sarah Sanders. Where is the White House right now as they react to this book? Do they fear it’s explosive or something they can shrug off?

MR. RUCKER: Well, they were hoping to ignore the book, you know, try not to give it too much oxygen, but clearly they’ve decided they can’t do that. That’s why Sarah put out that statement. We’ll see if the president reacts at all. But the allegations in the book which Dawsey and other reporters have read are really troubling for Trump. They can try to discount her as a fabricator, as somebody who’s not credible, but you know, we should share with the listeners that Dawsey actually heard some of the recordings that Omarosa had that form the dialogue in the book, and that is verifiable, some of it, and it is true, and so this could be potentially a problem for the president.

MR. COSTA: How do you – how do we think about this credibility factor? This book has a lot of material in it, yet Omarosa comes out of the reality school TV area, but she has – as Phil said, she was a White House staffer, a senior advisor to the president.

MR. RUCKER: Highest level salary.

MR. COSTA: Highest level salary.

MS. ATKINS: Yeah, but she is somebody who has a lot of credibility problems. I mean, the last job she had even after leaving the White House was back on reality television. We’ve seen her say one thing to the cameras while she was a part of the Trump campaign and the White House, and now she’s saying things that are completely different. Now, to the extent that there are tapes and there are recordings those will speak to themselves, but it depends on what else comes out in this book. If the biggest allegation is, well, the president said things that are racist, I don’t think that’s going to surprise a lot of people given the way he’s treated NFL protesters or LeBron James or other people, saying that there are good people on both sides. So I think it really depends on what’s in this book, how damaging it is to the president. I think just saying that he has bad things to say about African-Americans won’t be enough.

MR. COSTA: So, Jake, maybe if you’re a Republican running in the midterms this fall you’re not really worried about the book, but maybe if there is an Access Hollywood type moment where a tape comes out.

MR. SHERMAN: You’re taking the thought out of my mind. If a tape comes out, it could be – I’m not saying it’s going to end his presidency, but it could be very damaging. The Access Hollywood tape Trump was able to say, ah, I was a different person then; I was a television star joking around with a guy on a bus, yeah it was locker-room talk but it could be forgiven because a lot of people talk like that, whether you believe that or not; some people did. If this is – these are tapes of him in the Oval Office that are construed as racist, that’s a big problem for him.

MR. RUCKER: She actually makes clear in the book that the allegation about racism is that he used the N-word in tapings of The Apprentice , but she doesn’t actually have those recordings and she says she hasn’t heard them; she’s just heard about them. So those aren’t – those are not the allegations that are –

MR. SHERMAN: But these are – OK, if there are –

MR. COSTA: So maybe it’s about his conduct. There could be tapes about his just conduct, not race necessarily.

MR. SHERMAN: it’s the content of the tapes. And the tapes will be – if the tapes come out, they will be – everybody will listen to them and they’ll have a chance to hear for themselves.

MS. STOLBERG: I don’t know. I hate to cast doubt, but I just feel like nothing sticks with this president. If the Access Hollywood tape did not bring him down as a candidate, you know, I don’t know what it would take. Trump has said he could go out in the middle of Fifth Avenue and kill somebody and his base would still be with him, and I think to a certain extent that’s true. When I talk to voters, Trump voters, what I hear from a lot of them is, you know, I don’t like his behavior, but I like his policies, and I’m going to be looking at his policies. And they seem to be able to sort of compartmentalize and separate the man from, you know, what he does in office, the personality from the policies. So –

MR. COSTA: It’s a good – it’s a good final point. We all encounter that on the trail. Things that are the headlines in Washington aren’t always causing a ruckus back in different races.

We’re going to leave it there for this edition of Washington Week Extra . While you’re online, check out the latest Washington Week­ -ly News Quiz.

I’m Robert Costa. See you next time.