Trump Brands Clinton, Obama As Founders of ISIS; Clinton Slams Trump's Economic Plans; Top Clinton State Dept. Aide Involved in



Trump's Economic Plans; Top Clinton State Dept. Aide Involved in

Clinton Foundation; RNC Chief Voices Concern About Trump's Campaign;

Televangelist Opens Up About Donald Trump's Faith. Aired 7-8:00p ET - Part 1>

[19:00:12] ERIN BURNETT, CNN ANCHOR: OUTFRONT next, Donald Trump digs in saying President Obama is the founder of ISIS literally. Will he back down tonight?

Plus, new details about the relationship between Hillary Clinton's State Department and the Clinton Foundation. Did it cross the line? An exclusive investigation.

And Donald Trump's spiritual adviser on how he battles his inner demons. Our interview. Let's go OUTFRONT.

And good evening. I'm Erin Burnett. We begin OUTFRONT tonight with the breaking news. Donald Trump about to take the stage at a rally in Florida expected to attack President Obama calling him literally the founder of ISIS, not simply responsible for its rise, the literal founder. Here's some of what he said today.


DONALD TRUMP (R), PRESIDENTIAL NOMINEE: President Obama, he is the founder of ISIS. He is the founder of ISIS.

HUGH HEWITT, RADIO TALK SHOW HOST: Last night you said the President was the founder of ISIS. I know what you meant, you meant that he created the vacuum, he lost the piece.

TRUMP: No, I meant he's the founder of ISIS. I do. He was the most valuable player. I give him the most valuable player award.

Barack Obama and Hillary Clinton, these are the founders of ISIS. These are the founders of ISIS.


BURNETT: But not long ago right here on CNN, Trump had a very different opinion about who created ISIS.


TRUMP: But here's the problem. So, we make all bad deals. The war in Iraq started the whole destabilization of the Middle East. It started ISIS.


BURNETT: That, of course, a clear indictment of George W. Bush.

We begin our coverage of Jim Acosta who is at the Trump rally. And Jim, Trump is not backing down from these attacks on President Obama tonight.

JIM ACOSTA, CNN SENIOR WASHINGTON CORRESPONDENT: No, he is not, Erin. He used that accusation last night, he used it this morning, he used it earlier this afternoon and we expect him to do it once again this evening at this rally in Kissimmee, Florida, he'll be out here in just a few minutes. But not only is that accusation that Barack Obama and Hillary Clinton are the founders of ISIS. Plus, it also creates a problem for Donald Trump and then it opens up a criticism that he's being hypocritical.


ACOSTA (voice-over): It's fast becoming a go-to line of attack for Donald Trump. That President Obama and his former Secretary of State Hillary Clinton gave birth to ISIS.

TRUMP: I call President Obama and Hillary Clinton the founders of ISIS. They're the founders. In fact, I think we'll give Hillary Clinton, you know, if you're a sports team, most valuable player. MVP. You get the MVP award.

ACOSTA: Trump's rationale is that the President's withdrawal from the Iraq war created the conditions on the ground for terror group's rise to power.

HEWITT: He hates them and he's trying to kill them.

TRUMP: I don't care. He was the founder. The way he got out of Iraq, that was the founding of ISIS.

ACOSTA: The problem is Trump once advocated a speedy pullout from the war, too.

TRUMP: You know how they get out? They get out. That's how they get out. Declare a victory and leave because I'll tell you, this country is just going to get further bogged down.

ACOSTA: Trump first called Mr. Obama an ISIS founder at a rally last night in Florida where he also referred to the President by his full name and slamming the White House over its handling of Russia.

TRUMP: And we'll find out. But this was taken during the administration of Barack Hussein Obama, OK?

ACOSTA: Continuing that soft on terror theme, Trump also alleged that the Clinton campaign was aware that the father of the Orlando night club shooter was at a rally to Democratic nominee this week.

TRUMP: They knew, but how did you like that picture? Him sitting, 49 people killed and that guy is sitting back there and of course he likes Hillary!

ACOSTA: Top Trump campaign surrogates blame unfair media coverage. But former New York Mayor Rudy Giuliani insists Trump will still take part in all three presidential debates despite his battles with the press.

UNIDENTIFIED MALE: You don't buy it?

RUDY GIULIANI (R), FORMER NEW YORK CITY MAYOR: All three debates, the negotiations which the federal commission is always allowed between the candidate --


GIULIANI: -- Is going to happen.


ACOSTA: Now, Erin, just a few moments ago we had an incident unfolding inside this arena here in Kissimmee, Florida. There were three men sitting in the stands here who were flying the confederate flag and it took about 15 minutes for the Trump campaign and local security to convince these men to take that flag down. As a matter of fact, they took it down once, they put it back up again. And then finally security went over and had them take it down for good, they're right now flying the American flag. But as Donald Trump would say in one of his tweets. It was sad -- Erin.

BURNETT: All right. Jim Acosta. Thank you.

And Jeff Zeleny is travelling with Hillary Clinton tonight, OUTFRONT in Warren, Michigan.

Jeff, Democrats had been quickly responding to the charges that Donald Trump has been making against Barack Obama and being the founder of ISIS.

[19:05:12] JEFF ZELENY, CNN CORRESPONDENT: They have indeed, Erin. And Hillary Clinton once he was campaigning here in Michigan did not mention it herself. But she did tweet about it saying, no, he is not the founder of ISIS. But it was the statement from the Democrat National Committee that raised questions about Donald Trump's sanity. Let's take a look at this. It said, "Donald Trump should apologize for his outrageous unhinged and patently false suggestion on the founding of ISIS. This is yet another out of control statement by a candidate who is unraveling before our very eyes."

And the top foreign policy adviser to the Clinton campaign also has said that Donald Trump is trash talking America here by saying things like this. So, Erin, we are seeing an increasing pattern here that really started with Mike Bloomberg at the Democratic convention in Philadelphia talking about Donald Trump's sanity and you know, if he's all together here, really continuing this argument here. But across the board a condemnation of these ISIS comments here from Democrats today -- Erin.

BURNETT: All right. Jeff, thank you very much.

And OUTFRONT now, Kayleigh McEnany, Donald Trump's supporter. Mike Rogers, retired FBI special agent who is now advising Donald Trump's transition team on national security issues. Retired Major General Spider Marks who advised Mitt Romney in 2008 saying tonight though, you're going to say you're voting for for the first time and I'm going to get to that in just a moment. Hillary Clinton supporter Basil Smikle is also with me.

Let me start with you, General. President Obama the literal founder of ISIS. He was given an opportunity in that interview. It was Hugh Hewitt the radio host who said, you mean they came in and filled the vacuum and he said no, that's not what I mean, I mean, he is the founder of ISIS.

MAJ. GEN. JAMES "SPIDER" MARKS, RETIRED U.S. ARMY: Yes. It's crazy talk. This president is not the founder of ISIS. Clearly, there's culpability. There's a lot we could have done in Iraq. Our departure in 2011 was premature. The conditions were not set. We went into the negotiations. We wanted a status of forces agreement so that we could retain a presence and so we could continue to grow the Iraqi government, help with governance, help grow a military and that didn't happen and we marched out way too soon. But the President is not the founder of ISIS.

The core of ISIS are a grieved former Saddam military folks who guys like me when I was in Iraq put those guys in jail because we broke their military down. Big mistake, we should not have done that. A bunch of those dudes ended up to jail, they became aggrieved, they now are the leaders of ISIS. This is an organize military with a focus that is operating with some degree of impunity.

BURNETT: And of course, and Donald Trump by the way, walking to the podium and we expect he's going to say more about this, Mike. That you obviously are advising the transition team. You know, there's obviously blame on this to go around and there's the whole discussion over whether it's George Bush for wanting troops out or Obama for continuing to take them out. Who is responsible? But again, he was given the choice to say that what he meant was nuance and he very specifically said, no. I meant he's the founder.

MIKE ROGERS, CNN NATIONAL SECURITY COMMENTATOR: You know, I worked in a factory in Michigan for years and we built convertibles. I cut the roofs off of those cars. That talk is a little bit tongue in cheek, I think. When you hear that talk, I could have had that very conversation in the cafeteria at break in that factory floor. I think he's trying to make a point here. I think he's trying to say, he's having a hard time cutting through on the national security space.

If you look at Hillary Clinton's record as secretary of state, they failed in Russia. They failed in Egypt. They failed in Iraq, they created an environment that allows and this is a conversation we're all having including Spider Marks who is talking about this environment. I think that's what he's trying to do. I don't know that. I don't talk to him and that's not part of the question and those failures are something he needs to highlight. I think that's the way he's doing it.

BURNETT: OK. But to this point, though, he has -- this is an issue of who is more responsible for the rise of ISIS. He though Kayleigh at other times has repeatedly suggested that President Obama at the least sympathizes with Islamic terrorists and perhaps much worse, OK? Let me play it.


TRUMP: He doesn't get it or he gets it better than anybody understands. It's one or the other. Maybe he doesn't want to get rid of the problem. I don't know exactly what's going on.

I don't know what's wrong with Obama. He wants to close his eyes and pretend it's not happening. Why is he so emphatic on not solving the problem. There's something we don't know about. There's something we don't know about.


KAYLEIGH MCENANY, DONALD TRUMP SUPPORTER: None of those comments suggest to me that he's actually implicating Obama with ISIS. When he says Obama doesn't get it, maybe he doesn't want to get it. In fact Obama's own words suggest that he doesn't want to get it. When he calls ISIS jayvee, when his Secretary John Kerry.

BURNETT: He said maybe he doesn't want to get rid of the problem. What is he saying there?

MCENANY: Maybe he doesn't get rid of the problem because he doesn't even want to acknowledge that a problem exists. When you have the sitting Secretary of State, John Kerry stand before the world and say climate change is as dangerous as ISIS, they don't want to acknowledge the problem. It's insulting to 49 people who died in Orlando. A hundred and eighty four people who died in Paris, 14 who died in San Bernardino and the list goes on and on. It is absolutely insulting. They did found ISIS. They did establish it. Their names might not be on the Founding documents but they lay the groundwork and that is certain and four-star General Jack King back that up today when he said they contributed to the rise of ISIS.


[19:10:16] BASIL SMIKLE, HILLARY CLINTON SUPPORTER: You and I, all of us here could agree to disagree and we can have an intellectual conversation about the merits of ISIS today and how it's, you know, where we are, but I'll take it a step further. It's not just crazy. His language is disgusting to me. This is completely irresponsible to call the sitting president of the United States a founder of ISIS. He also called Hillary Clinton a co-founder of ISIS.


SMIKLE: That is incredibly, not only disrespectful, it's disgusting. And to me, I've felt for a long time that Donald Trump just wanted to sort of tap into the sentiment that the system is rigged. I think it's well beyond that right now. This man is a nihilistic in his approach. He is not going to be content until every political institution and indeed, most political leaders of this country have been, completely discredited.

MCENANY: Basil, your candidate called Donald Trump an ISIS propagandist. So, we went again to semantics and which titles worst, we can do --

BURNETT: That's true.

MCENANY: But the fact is --

SMIKLE: Because in part -- because he's going around telling people that the President, the President of the United States founded a terrorist organization. That's completely irresponsible.

BURNETT: And General, all of this is in part because you did something that you have not done before which is take a political stand.

MARKS: Yes, I have.

BURNETT: And you are going to vote for Hillary Clinton?

MARKS: I am. I made that decision. You know, I'm an Intel guy. My view and I have lived in this world. I have had my fanny chewed so many times. I have been wrong so many times. I was a senior Intel guy when we went to the war in Iraq. There was a lot that we did not get right and I did not get right and I raised my hand and I said, you know, I simply don't know. And I was ripped apart many times for that. You have to embrace what you know and what you don't know and then you have to be able to move forward and say, you know what, I got that wrong.

No intent to deceive and not trying to lie to anybody, I just screwed this up and we need to move forward and I don't see that level of humility in this candidate. That's what bugs me. That's what bugs me. I'm not a big fan of where we are right now with this current administration at all. It bothers me greatly. I'm the guy who sat around the table and I've had to bury soldiers for mistakes that we've made in combat in this administration and the previous administration.

I want to move forward with somebody and what I care about is national security first and foremost. There are a thousand things we all need to be passionate about. This is first and foremost. It's the job of our president of the United States, of our commander-in-chief to support and defend the constitution. I want that done right, and I think that Hillary Clinton will do that better than Donald Trump.

BURNETT: And Mike, a chance to respond.

ROGERS: No. Again, the failures are just unbelievable and she's already the former secretary. As again, backed the wrong candidate in Egypt and got it completely wrong on Russia and now we're paying a price for expansionism there. Didn't deal with China expansionism, we've got a problem. MARKS: The pivot.

ROGERS: Which hasn't happened, by the way and you know that and they're saying we're going to continue the same policy. The policy on ISIS really has been a disaster and dangerous. My argument here is, listen, he has already said and certainly, I'm obvious of this, he said we're going to put the best national security people we can around him to make good decisions and it will change. I argue if we don't change, if we continue the same path which Hillary Clinton has said we're going to do, we are going have real national security and defense problems.

Secondly, the budget, you know this when you were there. They said the number one problem and threat to national security was the budget. She plans to spend a trillion extra dollars and she hasn't explained how to pay for. Pretty soon, the national debt, the interest on the national debt will be a larger budget item than the Department of Defense. That is a huge problem. When you add all of that up, it just doesn't make sense for national security people.

BURNETT: All right. Well, both of them, both of them by the way are going to be increasing deficits, let's just be honest about that. But we're going to take a break, we're coming back in just a moment. Next, Donald Trump is under pressure, we're going to talk about the economy here and also his tax returns.

Plus, new details about a secret meeting between Hillary Clinton's top aide at the State Department and a Clinton Foundation job applicant. This is an exclusive CNN investigation and you will see it this hour.

And a popular televangelist, Trump's spiritual adviser opens up to OUTFRONT about their relationship.


UNIDENTIFIED FEMALE: He was watching Christian television and he called up and said hey, you're fantastic and repeated almost verbatim three of my sermons on value and vision.



[19:17:40] BURNETT: Tonight, Hillary Clinton bashing Donald Trump's plans for the economy. She says his tax plan will add to the struggles of the middle class. In fact, she said Trump's plans puts him and his wealthy friends first at the expense of others.

Pamela Brown is OUTFRONT.


HILLARY CLINTON (D), PRESIDENTIAL NOMINEE: It's wonderful to be back in Michigan.

PAMELA BROWN, CNN JUSTICE CORRESPONDENT (voice-over): Hillary Clinton is drawing a sharp contrast with Donald Trump on the economy.

CLINTON: When he visited Detroit on Monday, he talked only of failure, poverty and crime. He is missing so much about what makes Michigan great!

BROWN: Speaking at a manufacturing plant outside Detroit, Clinton charged that Trump's economic proposals would benefit the wealthy at the expense of middle-class Americans.

CLINTON: He hasn't offered any credible solutions for the very real economic challenges we face.

BROWN: Her speech comes three days after Trump addressed the Detroit Economic Club where he accused Clinton of backing trade agreements that have hurt Michigan's manufacturing industry.

TRUMP: Hillary Clinton has supported the trade deals stripping this city and this country of its jobs and its wealth.

BROWN: Clinton responding to Trump's criticism today.

CLINTON: Mr. Trump may talk a big game on trade, but his approach is based on fear, not strength. Fear that our country has no choice, but to hide behind walls.

BROWN: Clinton also attacking Trump today not only on his tax proposal but for his failure to release his tax returns.

CLINTON: He refuses to do what every other presidential candidate in decades has done and release his tax returns.

BROWN: Trump still refusing to release his returns while they're under audit. Instead today slamming Clinton's record on taxes.

TRUMP: Hillary has supported tax increases on the middle class for her entire career.

BROWN: When it comes to the handling of the economy, the latest CNN/ORC poll shows Clinton with the narrow advantage over Trump. Fifty percent of voters trust her while 48 percent say they trust Trump. Clinton is hoping to expand that by undercutting Trump's core message on the economy.

CLINTON: Now, there is a myth out there that he will stick it to the rich and powerful because somehow he's really on the side of the little guy. Don't believe it.


BROWN: And that campaign adviser tells CNN, Hillary Clinton will release her 2015 tax return as early as tomorrow and Tim Kaine, her running mate, will release ten years of tax returns as well. Of course, according to the -- to keep the pressure on Trump to release his own tax returns according to this campaign adviser. Back to you.

BURNETT: All right. Thank you very much, Pam. And OUTFRONT now senior adviser to the Trump campaign, Boris Epshteyn, former spokesperson to the Reagan White House Doug Elmets, Hillary Clinton supporter joins me along with Basil and Kayleigh who are back as well.

Boris, you just heard Pam reporting. Okay, we're going to get Tim Kaine ten years, we're going to get Hillary Clinton's tax returns. Bloomberg poll shows about 70 percent, 68 percent of voters say that it bothers them that Donald Trump hasn't released his returns.

BORIS EPSHTEYN, SENIOR ADVISOR, DONALD TRUMP CAMPAIGN: Seventy percent of voters don't trust Hillary Clinton. Right? So, his tax returns, he's a private individual and it is up to him if he wants to release those returns, he has released 104 pages of a financial disclosure is much more inclusive, much more extensive that any tax, they'll not tell you that as a business owner, tax returns only give you a snapshot and not that deep, that financial disclosure form that really goes deep into someone's finances and it's all out there.

BURNETT: Buy it, Doug?

DOUG ELMETS, HILLARY CLINTON SUPPORTER: Not at all. I mean, what does he have to hide? Honestly, I wonder if maybe he's got international dealings, maybe he's paid zero in taxes.


No, interestingly, "The New York Times" has an article that's just been posted online saying, you know, how much has Donald Trump paid in taxes? Maybe zero. Maybe he's not made charitable contributions.

EPSHTEYN: The key word there be maybe --

ELMETS: Well no, you should read the article because he really gets into it in quite a bit of detail.

EPSHTEYN: It's hyperbole though.

ELMETS: The question is, what does he have to hide, though?

BURNETT: But even if he didn't pay any taxes --

EPSHTEYN: What is she hiding in her e-mails?

BURNETT: Even if he didn't pay any taxes, he's been able to turn these things into his advantage. He say, you're right because I can afford the lawyers to get around the system and our tax law allows it. That has not hurt him with voters before. So paying zero wouldn't seem to be a fear for him.

SMIKLE: It doesn't hurt him with his core supporters but I think it does undermine his rationale for running which is, I'm a businessman, what I've done in my business enterprise. I can use as a framework for what I can do for America and if you -- if he which he has said that he's taken such advantage of the bankruptcy laws and such advantage of the system, what I think releasing those tax returns does is it sheds light into just what kind of games he was playing. And the fact of the matter -- and the fact is, he is not a private person anymore. He is a public official. He is the nominee of his party.

[19:22:28] MCENANY: And that's what we know about -- what we know about the nominee is that he's been acting lawfully. He's been audited nearly a dozen times, he came out of those audits unscathed, he's acting in a lawful manner. And he's paying his taxes. He'd be in jail otherwise. But Hillary Clinton on the other hand, an obligation to retain those e-mails under the federal record acts and she did not do that. So, I'm more interested in the missing e-mails that have suggested of --

BURNETT: Kayleigh, one thing though on this issue of the tax returns though, the longer he doesn't put it out the more speculation you get about why. That can be damaging. Here are people speculating, some of whom in his own party about what's in these returns.


UNIDENTIFIED MALE: Either he's not anywhere near as wealthy as he says he is or he hasn't been paying the kind of taxes we would expect him to pay or perhaps he hasn't been giving money to the vets or to the disabled like he's been telling us he's been doing.

SEN. TED CRUZ (R), FORMER PRESIDENTIAL CANDIDATE: Maybe it is the case that Donald -- there have been multiple media reports about Donald's business dealings with the mob, with the mafia.

GEORGE WILL, COLUMNIST, WASHINGTON POST: Perhaps one more reasons we're not seeing his tax returns because he is deeply involved in dealing with Russian oligarchs and others.


BURNETT: He could put all that to rest if he just put them out there, Kayleigh.

MCENANY: Right. I'm glad you brought up Mitt Romney because more Mitt Romney did is, he always liked to play into the hands of my liberal friends over there. He played right into their hands throughput the whole election campaign because you guys were prodding him to release the taxes.

BURNETT: Which he did and he got slammed for it.

MCENANY: He got slammed for it and that was the beginning of the end of the Romney candidacy. Even though --

SMIKLE: So the point --

EPSHTEYN: Mitt Romney said very different thing about Donald Trump.

BURNETT: That's a fair point.

SMIKLE: So the point is don't release your tax returns so you don't get slammed on it. EPSHTEYN: Why not release the 33,000 e-mails Hillary is hiding?

BURNETT: OK. What about -- there is one thing.

EPSHTEYN: I'd love to know. Do you know?

BURNETT: Separate from the e-mails, he is aware of the transcripts for her Wall Street speeches? Isn't that equivalent? Why not release those? If she has nothing to hide about what she said with Wall Street and her relationship with Wall Street, where are the transcripts?

ELMETS: I think that if you're running for president, you've got to be transparent, I think that she should release whatever transcript maybe, need to be released and I also think that Donald Trump probably has something to hide and he's reluctant --

EPSHTEYN: It's irresponsible to do what you're doing, you're guessing.

ELMETS: Well, I may be but maybe I'm not. But I think a lot of people as Erin said, 70 percent of the people said they want to know where it is.


BURNETT: If Kayleigh, he puts out these audits with no problems then what is there to be ashamed of or worried about?

EPSHTEYN: Listen, he said he is going through an audit and he will do when an audit is complete. Again, he has complied with all of the rules and regulations. Something Hillary Clinton has not done and we know for a fact now, she lied to Congress when she said that she turned over all her e-mails. We know that just from the news that came out yesterday and the --

BURNETT: OK. On that point of the e-mails, I do want everyone to know, we have new details tonight about State Department's relationship with the Clinton Foundation. You have got to see this, this is a significant report and it's an exclusive investigation OUTFRONT next.

Plus, Donald Trump already talking about what would happen if he loses.


TRUMP: I'm going to have a very, very nice, long vacation.



[19:29:19] BURNETT: Right now. Donald Trump, as you can see, rallying supporters in Florida. He is speaking live and we were monitoring it just moments ago training his fire on Hillary Clinton's e-mails.


TRUMP: Aren't e-mails a wonderful thing? Right? Right? What a great invention and things came out just over the last two hours. When you go home -- I won't. I'm not going to do it. Because if I mention it, they'll play it down. So, I'm not going to mention it.


BURNETT: All right. Well, we're going to mention it. The e-mails are raising questions about the relationship between the State Department under Hillary Clinton and the Clinton Foundation. Tonight, we are learning much more about that relationship and Drew Griffin has this exclusive CNN investigation.