'This Week' Transcript: Reince Priebus, Sen. Rand Paul, and Sen. Claire McCaskill

Priebus, Paul, and McCaskill will appear on "This Week."

ByABC News
December 11, 2016, 9:16 AM

— -- ANNOUNCER: Starting right now on THIS WEEK WITH GEORGE STEPHANOPOULOS, democracy hacked -- did Russia want Trump in the White House?

The latest details on the secret CIA findings.

And, after downplaying Russia's role...




ANNOUNCER: -- Trump now lashing out at the CIA.

Plus, the secretary of State search -- what could an oil executive mean for U.S. foreign policy?


TRUMP: He's much more than a business executive. I mean he's a world class player.


ANNOUNCER: And Team Trump defending ties to his reality TV show and his empire -- will Trump's efforts to untangle potential conflicts of interest go far enough?

We take all the tough questions to incoming Chief of Staff Reince Priebus, Senator Rand Paul and top Democrat senator, Claire McCaskill.


TRUMP: I am asking you to believe once again in America.


ANNOUNCER: America in transition -- can a divided nation unite under Donald Trump?

From ABC News, it's THIS WEEK.

Here now, chief anchor, George Stephanopoulos.


We have two big stories breaking this weekend, both zeroing in on America's critical and fractious relationship with Vladimir Putin's Russia.

Reports the CIA has concluded that Russian hacking of Democratic emails was aimed at helping Donald Trump defeat Hillary Clinton, a step beyond the intelligence community's earlier finding that Russia was simply trying to cast doubt on the integrity of our elections.

The Trump team hit back with a swift and stunning rebuke of the CIA. Quote, "These are the same people that said Saddam Hussein had weapons of mass destruction."

And hours later, word from the Trump transition that the president-elect is likely to name a close ally of Vladimir Putin from the corporate world to be secretary of State.

There you see Exxon CEO Rex Tillerson closing a deal with Putin in 2011. Two years later, he received one of Russia's highest civilian honors, the Order of Friendship.

Senators from both parties are already raising questions about the pick. But in an interview on "Fox News Sunday," Trump called Tillerson a world class player running the world's largest company.


TRUMP: It's been a company that's been unbelievably managed and to me, a great advantage is he knows many of the players and he knows them well. He does massive deals in Russia. He does massive deals for the company, not for himself, for the company.


STEPHANOPOULOS: Lots of news, lots of questions this Sunday for the president-elect's incoming chief of staff, Reince Priebus.

Mr. Priebus, thank you for joining us again this morning.


STEPHANOPOULOS: Let’s begin with that shot across the bow, the CIA, from your transition. It kind of startled intelligence officials.

How is a President Trump going to work with intelligence agencies if he doesn’t trust their work?

PRIEBUS: Well, he trusts the CIA. Look, George, this is about 17 or so unnamed agencies in an unnamed report that based the report on something that is totally false.

The RNC was not hacked. And so the report is basically trying to make the case that the RNC was hacked, the DNC was hacked, and the only e-mails that came out were DNC e-mails, so therefore, this is the conclusive report that the Russians or whoever was doing the hacking wanted to unfairly change the election.

STEPHANOPOULOS: You say he trusts the CIA, then why did your (INAUDIBLE)...

PRIEBUS: But the problem is...

STEPHANOPOULOS: -- then why did your transition...

PRIEBUS: Of course we do.

STEPHANOPOULOS: Hold on a second.

Well, then why did you put out a statement questioning the CIA?

PRIEBUS: Well, no, I mean the report was -- excuse me, George. The entire report is based on unnamed sources who are perhaps doing something they shouldn’t be doing by speaking to reporters or someone talking out of line about something that is absolutely not true.

The FBI can -- we contacted the FBI months ago, when the DNC issue came about. They’ve reviewed all of our systems. We have hacking detection systems in place. And the conclusion was then, as it was again two days ago, when we went back to the FBI to ask them about this, that the RNC was not hacked.

So here we are now debating and talking about a story based on something that isn’t true. And we’re just...

STEPHANOPOULOS: Well, that's...

PRIEBUS: -- we’re in this circuitous...

STEPHANOPOULOS: That’s only one aspect of...

PRIEBUS: -- fiasco...

STEPHANOPOULOS: Hold on a second. That's...

PRIEBUS: -- about something that’s not true.

STEPHANOPOULOS: -- that’s only one element of the story. I mean, that’s what the -- perhaps the FBI told you the RNC wasn’t hacked.

But do you know where all of your data was stored?

It could have been stored in other archives.

And are you confident that other intelligence agencies haven’t reached the conclusion that some of your data was, indeed, hacked, perhaps personal Gmail accounts?

PRIEBUS: I’m telling you, as an actual source to you and the press, because you have no source otherwise, other than an unnamed source that also concluded that everything else was inconclusive -- I’m telling you as a source that, to the best of my knowledge, and based on conversations that the RNC has had with the FBI, that there -- I know of no instance that you’re describing involving the RNC or the RNC’s data. So I -- it’s hard for me to have a conversation about something that I have no evidence to the contrary to talk about.

STEPHANOPOULOS: Do you know where all your data was stored?

PRIEBUS: We know where our data is stored, George. We do. And we have reviewed all of that data, along with security experts, along with folks at the FBI, and they’ve told us that we have not been hacked. And when the story hit in "The New York Times," our folks went back to -- not me personally, our chief operating officer -- went back to his contact at the FBI and again was assured that we were not hacked.

So I -- you know...


PRIEBUS: -- we're talking about this story -- which, by the way, the story itself said was inconclusive, it’s -- I don’t know what to tell you. It is unbelievable that the press would run with unnamed sources about something, that they agree was inconclusive, but ignore the fact that the actual people involved on the other side of this story are telling you it’s not true.

STEPHANOPOULOS: Well, this comes on the heels of another report from the intelligence community -- all 17 intelligence agencies did come to an agreement that Russia was trying to influence the elections without describing a motive. When I spoke to President-elect Trump about that back in October, he said he hadn’t gotten a briefing.

Has he been briefed now on those findings?

PRIEBUS: I -- listen, I’m not -- by the way, George, as you know from working in the White House, it takes a long time -- I’m not the president, so the president, you know, has top secret clearance immediately. I don’t. It takes time. So I’m not in those top secret meetings, nor would it be appropriate -- the president can’t tell me what’s hap -- what’s being said in a top secret meeting unless I have top secret clearance. I will eventually be in those meetings.

But, look, the Russians didn’t tell Hillary Clinton to ignore Wisconsin and Michigan, OK?

I mean, I know it’s -- this is this insane analysis. She lost the election because her ideas were bad. She didn’t fit the electorate. She ignored states that she shouldn’t have, and Donald Trump was the change agent, OK?

So this is all very interesting, but Donald Trump won in an electoral landslide that had nothing to do with the Russians...

STEPHANOPOULOS: Nobody here is...

PRIEBUS: -- or whoever else...

STEPHANOPOULOS: -- nobody here is...

PRIEBUS: -- is concluding that.

STEPHANOPOULOS: Nobody here is questioning the victory. I want to know President-elect Trump doesn’t believe the conclusions of 17 intelligence agencies.

PRIEBUS: But you don’t have a source. I mean, you’re claiming that an unnamed -- an unnamed report -- this is what I can’t understand. Look, I think that when the...

STEPHANOPOULOS: No, but a hold a second.

PRIEBUS: -- if there's ever a report...

STEPHANOPOULOS: No, Mr. -- I’m talking about...

PRIEBUS: If there's ever a report...

STEPHANOPOULOS: I’m talking about...

PRIEBUS: Look...

STEPHANOPOULOS: -- the finding in October that is public now of 17 different intelligence agencies saying Russia tried to meddle with our elections. That’s before this weekend.

PRIEBUS: That’s not true. George, you don’t know -- you don’t know that conclusively. The report also said that there wasn’t agreement among the 17 agencies. When the FBI came out -- they came out -- when there was a conclusion on the DNC, their conclusion was very clear and they made it public. Now, if the CIA...

STEPHANOPOULOS: That’s what I’m talking about,

PRIEBUS: -- or whoever else comes out...

STEPHANOPOULOS: -- that's precisely the conclusion I’m talking about, but the president-elect says he doesn't...

PRIEBUS: But they didn't...

STEPHANOPOULOS: -- accept that either.

PRIEBUS: -- but they didn’t conclude that it was Russia. George, but they didn’t conclude it was Russia. I’m not -- I don’t care -- listen, I don’t care if it’s Russia or whoever, they shouldn’t -- we’re going to protect Americans. We don’t want these countries or whoever else these people are hacking our country, our parties, our -- we protect our Americans. We don’t like it. We’re against it.

But what I can’t do is have an intelligent conversation with you about a report in "The New York Times" that is unnamed, inconclusive, and based on something that isn’t true.

STEPHANOPOULOS: I’m asking you about the conclusions...

PRIEBUS: We were not hacked.

STEPHANOPOULOS: -- that were made public back in -- back in October.

But let’s move on now. There’s a statement just out this morning from several members of the Senate, both Democrats and Republicans, including the Democratic leader, Charles Schumer; John McCain, the chair of the Senate Armed Services Committee; and Lindsey Graham, also a member of the Senate Armed Services Committee.

He -- they write that recent reports of Russian interference in our elections should alarm every American. They say Democrats and Republicans must work together to investigate this.

Do you support that investigation in the Senate right now?

PRIEBUS: I support anything that we can do, including investigations or otherwise, to protect Americans from foreign interference in all of our good work that we need to do in the United States, whether it be our elections, whether it be our businesses, whether it be our electronic -- you know, electric grids. We have to protect America. So I’m all for finding out how in the world this stuff is happening and so that we can put systems in place to protect Americans. Again, we don’t like this.

But I also want to make sure that when we debate these things, that we actually have the facts that are very clear in front of us to have this debate.

STEPHANOPOULOS: I do think we have those -- those facts. But you’re saying you’re now supporting this further investigation.

So let’s move on to your -- the president-elect...

PRIEBUS: I’m not saying -- I'm supporting anything that we can do to find out how this stuff is happening. I -- and I would -- and I think the president-elect also supports anything we can do to put an end to these sorts of incidents from taking place in our country.

STEPHANOPOULOS: And if it turns out that this investigation and the review order by President Obama conclusively determines that Russia was behind this, will President Trump retaliate?

PRIEBUS: Look, you're going to have to talk to President-elect Trump about that. But certainly we're going to do whatever that loaded word retaliate is, we're going to do everything we can in order to prevent all of this stuff from happening ever again.

And I'm sure appropriate measures will be explored as to what to do if that is concluded to make sure that number one, it doesn't happen again and make sure that we put systems in place that protect Americans.

STEPHANOPOULOS: Let's talk about the president-elect's likely pick for secretary of state Rex Tillerson, if that is indeed true. The New York Times is reporting that your colleague Steve Bannon and Jared Kushner think Tillerson is, quote, in a different league from the other candidates. Is that your view, too?

PRIEBUS: Certainly, I think he's an incredible businessman and American patriot and somebody that I think has experience across the globe that very few people have. I also think we have got other great choices to make. The conclusion has not been made. There's no announcement that's coming today, George, as far as Secretary of State is concerned.

So, it's a little premature to be claiming that this is a done deal, but certainly Rex Tillerson is American icon and businessman that I think is a pretty incredible guy.

STEPHANOPOULOS: Is this the right time for a secretary of state who has close ties to Vladimir Putin?

PRIEBUS: Well, look, I mean, he's in the business of exploring and finding oil across the globe. And so you have to go where the oil is at, and the fact that he actually has a relationship with people like Vladimir Putin and others across the globe is something that shouldn't be -- we shouldn't be embarrassed by it, it's something that I think could be a huge advantage to the United States.

Look, it doesn't mean we're not going to be tough across the world, it doesn't mean that we're not going to always put America first in everything we do. But we have big problems in this world. And I don't think we can solve these big problems by making believe that people don't exist. They exist. We have to talk to people.

Reagan talked to people across the world and he was very successful in communicating and treating people with dignity and respect, but putting America first in every single we do.

STEPHANOPOULOS: Senators like Ed Markey on the Democratic side, John McCain and Lindsey Graham on the Republican side promising tough questions. Any concerns about confirmation?

PRIEBUS: No. First of all, the pick hasn't been made, so I'll say that again. But no, we don't have -- we don't have concerns about confirmation.

One of the biggest companies in the world. But again, we'll find out whether it's him or someone else on the list and so, listen, it's not a done deal. And it's premature. But I will tell you that I think this person is incredibly talented and could do a very good job as secretary of state.

STEPHANOPOULOS: Finally, late this week, we learned that President-elect Trump intends to keep his executive producer title on Celebrity Apprentice. We know he's going to come out later this week and talk about how he's going to handle the overall conflicts of interests, perhaps, with his businesses in the White House.

Newt Gingrich said that this executive producer is weird and it raises -- does raise questions about possible conflicts. The FCC regulates NBC corporations can try to curry favor with the president by placing their products on the show, buying advertising. Isn't that an issue?

PRIEBUS: I don't think it's an issue.

Look, it's not going to be sitting there producing The Apprentice. I can assure you of that. It's something that he owns. It's a title he owns, but I'm telling you he's going to be 100 percent focused in the White House. He's not going to be sitting in studio acting as the executive producer of The Apprentice. I think that's Mark Burnett and that's the way it's going to be.

STEPHANOPOULOS: But he has decided to reject the advice of the office of government ethics to divest from all of his businesses?

PRIEBUS: No, that's not true. You'll have to wait and see when he has this -- when he concludes the very complicated ethics review and puts up the walls that he needs to put up for the family and the businesses and they're working through that diligently, George, I can assure you of that. But isn't just some easy weekend project.

I mean, when you have hotels and businesses and retail space across the entire world, it takes time to unpack that and to put this in a place that makes sense for him and the family.

STEPHANOPOULOS: Mr. Priebus, thanks for joining us this morning.

PRIEBUS: You bet, George. Thank you.

STEPHANOPOULOS: Let's get more on this now from Senator Rand Paul, republican member of the foreign relations committee in the Senate. Senator, thank you for joining us.

SEN. RAND PAUL (R), KENTUCKY: Good morning.

STEPHANOPOULOS: Let's begin with this issue of Russia.

We have President-elect Trump out there this morning calling the CIA assessment that Russia was trying to help elect him ridiculous. He also questions -- says he doesn't believe the earlier findings of all 17 intelligence agencies that Russia was trying to get involved in our elections.

You just heard Reince Priebus there as well. What do you make of all that?

PAUL: You know, I think we need to get to the bottom of it. And I think there should be an investigation because in order to defend ourselves against other adversarial countries, we have to protect our information.

But one of the things that came out of the campaign, as I recall, was a high ranking Clinton official, I believe, sent their password via email. We also need to learn how to protect our own information. And I think that's important as well.

But the government does need to learn from this and see if we can do a better job.

But I will tell you, though, that Donald Trump got 70 percent in eastern Kentucky and I don't think it had anything to do with the Russian. He got 70 percent because in eastern Kentucky we didn't like what President Obama or Hillary Clinton wanted to do to our coal jobs. It didn't have anything to do with the Russians.

STEPHANOPOULOS: Again, they weren't making any conclusions about whether or not it affected the outcome of the election. They weren't drawing that conclusion at all.

But what do you do -- and you're a member of the Senate foreign relations committee -- what do you do as you continue to investigate this if the evidence continues to pile up that Russia was trying to influence our elections? How should the U.S. respond?

PAUL: You know, I think it's a little premature to talk about response until we know exactly what happened, but we should know what happened. And we should know how to defend ourselves without question. This is an ongoing threat from a variety of sources around the world. And actually I think it works both ways. I'm not privy to it, but I think all of the various country that have the ability are invading each other's computers all the time. But we have to protect our data. It's very important.

STEPHANOPOULOS: How about this likely pick for secretary of state, Rex Tillerson. Again, we heard Reince Priebus right there talk about his business experience. You have got your colleagues like Senators McCain and Graham saying they want to ask him a lot of questions in these confirmation hearings. You're sitting on the senate foreign relations committee. Do you have any concerns?

PAUL: You know, I'm going to reserve judgment on Tillerson. But I'll ask him the same question I've asked the others: do you understand the historic lesson that the Iraq war was a failure, a strategic mistake, that's what Donald Trump says.

I don't know about Tillerson, but I do know that John Bolton doesn't get it. He still believes in regime change. He's still a big cheerleader for the Iraq war. He's promoted a nuclear attack by Israel on Iran. He wants to do regime change in Iran. So, I think John Bolton is so far out of it and has such a naive understanding of the world. If he were to be the assistant or the undersecretary for Tillerson, I'm an out automatic no on Bolton. He should get nowhere close to the State Department if anybody with the same world view is in charge.

STEPHANOPOULOS: So, automatic no on Bolton as deputy secretary of state. He is also the likely pick on that.

But open mind on Tillerson. What about Mr. Tillerson's ties to Vladimir Putin?

PAUL: I don't know that yet. And to me the most important question is are you an advocate for the Iraq War? Do you think that was a good idea? Do you think regime change? Because see these questions keep recurring. You know, Bolton was an advocate for regime change in Libya, so was Hillary Clinton actually. And Donald Trump said it was a mistake. I agree it was a mistake to do regime change in Libya. We became more endangered and actually worse people took over afterwards.

I also think regime change in Syria is a bad idea. And that's an ongoing question. It's one of the things I like about Donald Trump, one of the reasons I endorsed him is he thinks regime change is a mistake. But John Bolton thinks completely the opposite. They are diametric opposites.

So I'll do anything to try to prevent John Bolton from getting any position, because I think his world view is naive. He believes we're going to spread democracy. We're going to topple governments everywhere and they're going to elect Thomas Jefferson. That's not the way it works in the Middle East.

STEPHANOPOULOS: It's clear where you stand on that right now.

On another subject, how about the budget. We heard President-elect Trump say this week that he wants a trillion dollar infrastructure program, also repealing Obamacare, and according to the CBO repealing Obamacare is going to add billions to the deficit.

You have been a real hawk on government spending. Can you support a budget right out of the box that adds to the federal debt?

PAUL: No. In fact, I won't support any budget, whether it's a Republican or a Democrat budget, that doesn't lead to balance.

The current budget that the Republicans are looking at never balances. How can that be fiscally responsible? And how can we look at the public with a straight face and say yes we ran on balanced budgets. We're for the balanced budget amendment and yet the budget we're going to introduce, that we're going to repeal Obamacare with never balances.

So I'm a no vote right now. And all it takes is a couple of us. If there are few conservatives in the senate wing of the Republican Party that will say no to a budget that never balances, we could have the power to say to the leadership, you know what, need a better budget.

I don't know if it will happen, but I know that I will be one that won't vote for a budget that never balances.

STEPHANOPOULOS: Do you have others ready to join you?

PAUL: We'll see. I'm working on a few that are close allies in the Senate. And we'll see what happens.

But I don't think it's known yet. Also, they haven't put all the numbers into the budget, so we're going to have to see.

But the budget they're contemplating is a budget that never balances. And I won't support that.

STEPHANOPOULOS: Finally, how about this question of conflicts of interest. We saw President-elect Trump's decision on Celebrity Apprentice earlier this week. He's going to make a major announcement later this week on how he's going to handle his overall businesses.

If he keeps the businesses in the family, do you have any concerns that foreign interests, foreign organizations might be trying to curry favor by doing deals with the Trump family?

PAUL: You know, I think when people voted for Donald Trump, they realized he owned a lot of stuff with his name on it. I think the concern over conflict of interest seems to be higher in the media than the public. People saying, oh, he has to sell all of his stuff.

How would you possibly sell 700 companies in a fire sale and hope to get what they were worth?

It's just an unrealistic sort of standard they're trying to hold him to.

So yes, I think he has to do everything he can to set up a firewall between him and his businesses. But I think it's unrealistic for people to be saying, oh, he should just sell all of his businesses.

It's not like stock. We've had presidents that have put their stock into account and they didn't know what their stock mix was and I like that. And I think Donald Trump has agreed that he would do the same on his stock. He's either sold it or will do it.

But it's a little different when you spend 30 years developing all these companies that we just ask him to sell them. So I don't think that's a fair request.

STEPHANOPOULOS: Senator Paul, thanks for joining us this morning.

PAUL: Thanks, George.

STEPHANOPOULOS: Let's get a Democratic perspective now from Senator Claire McCaskill of Missouri.

Senator McCaskill, thank you for joining us this morning. Let's pick up right there where Senator Paul left off.

Do you think it's unrealistic for Donald Trump to divest?

MCCASKILL: Well, I just think it's weird that he wants to be an executive producer of a TV show while he's President of the United States. I agree with Newt Gingrich. He doesn't have to do that.

And I think he can take major steps towards reassuring the American people that there can't even be appearance of impropriety for pay-to-play schemes under his administration.

STEPHANOPOULOS: How about this issue of Russian involvement in the American election?

We saw these reports over the weekend. We've been talking about them, of the CIA saying they were trying to tip the scales for Donald Trump. You have now got these bipartisan calls for an investigation.

Do you support that?

MCCASKILL: Yes, absolutely. And by the way, this should be not only about protecting us going forward but this is a form of warfare for Vladimir Putin, who is a thug and a bully and has the friends around the globe that we don't want to be friends with.

For him to be trying to impact our elections, that -- we have to -- there has to be -- he has to be held accountable.


MCCASKILL: And that's why this has to -- well, that's -- some of that's classified, I believe. And I don't think that's something that we can discuss on TV.

But I've had briefings just this last week that indicate that this is a very serious issue for the American people to understand. And for Donald Trump to dismiss out of hand the intelligence community's fact gathering is, frankly -- doesn't bode well for him protecting our country.

I think he needs to not immediately react and wait until he gets all the facts.

STEPHANOPOULOS: It appears that Rex Tillerson is going to be the pick for secretary of state, even though, as Reince Priebus said, it's not a completely done deal yet.

What kind of questions do you have about that?

MCCASKILL: Well, first of all, his cabinet or -- I call it the 3-G cabinet, Goldman, generals and gazillionaires. And I think it's one of the things that for someone who has worked around the world for profit, it is different than working around the world to make sure we have strong alliances and to make sure that we are in the strongest position to protect our country.

And I worry about the lack of experience that he has had on the diplomatic front and, frankly, I think that's true for many of the appointments to Trump's cabinet. They haven't had experience in the areas that they're being asked to manage in a very complicated world and a very complicated government.

STEPHANOPOULOS: You mentioned the concerns about the generals as well. You, of course, are on the Homeland Security Committee. General Kelly has been named as the new secretary, the nominee for Homeland Security.

You have concerns about him?

MCCASKILL: Well, I'm going to wait for the confirmation hearings. I'm familiar with General Kelly because of my work on the Armed Services Committee. I think he is a fine general and I want to make sure that he has a handle on some of the complicated issues that are contained within Homeland Security.

They have a lot of contractors. We have had a lot of whistle-blowing going on out of the Department of Homeland Security, low morale. I want to make sure he understands the agency he's stepping into. So I'll reserve judgment until after confirmation hearings.

STEPHANOPOULOS: On another matter, your outgoing leader, Senator Harry Reid, thinks that the FBI director, James Comey, should resign because he underplayed information that Russia was involved in these elections.

Do you agree with that?

MCCASKILL: Well, I know this, that there were thousands and thousands of hours given to Hillary Clinton's e-mail server and Benghazi. It seems to me we need bipartisanship now to look at exactly what happened in this election and exactly the things that people like James Comey did and put it in context to make sure we have all the facts, because I don't think anyone is comfortable with how this election played out.

I'm not questioning that Donald Trump won the election. But there's nothing more sacred than our democratic process in the United States. And we have got to make sure that -- put aside partisan politics and make sure that we're getting to the bottom of all of this.

STEPHANOPOULOS: One of the things we know for sure in this election -- and Rand Paul just talked about it -- Hillary Clinton got decimated in rural and small-town America, not only in Kentucky, but in places like Michigan, Wisconsin and Pennsylvania.

How do Democrats get their act together, win back those rural, small-town voters that they have lost?

MCCASKILL: Well, I think it's important that we show up. I think it's important that we communicate directly with all those working people.

You know, I was really shocked this week that, after all of this talk about coal miners and all of this talk about Buy America, the Republicans and the House of Representatives gutted health care and pension protections for coal miners and removed the Buy America provision that had been put in the bill in a bipartisan basis.

So I think we have got to call out the Republicans, where their walk doesn't match their talk, and I think we also have to make sure that we communicate clearly that we are the party that cares deeply in our core about working people in this country.

STEPHANOPOULOS: Senator McCaskill, thanks for joining us this morning.

MCCASKILL: Thank you.

STEPHANOPOULOS: Coming up, as we heard, President-Elect Trump will say this week what he intends to do with his businesses once he enters the White House. We're going to ask ethics lawyers for Presidents Obama and Bush what they think he should do. And our Powerhouse Roundtable ahead on another head-spinning week in politics.


STEPHANOPOULOS: There you see Donald Trump taking a break from the campaign trail to open his new hotel in Washington. And that pride and joy is just one of the businesses that could create a conflict of interest in the Oval Office.

As the president prepares to address these conflicts in a press conference this week, our chief investigative correspondent, Brian Ross, reports on Trump's global business empire and what it means once Trump enters the White House.


BRIAN ROSS, ABC CORRESPONDENT (voice-over): For Donald Trump's business partners around the world, including the developers of this luxury golf course in Dubai, what some in the U.S. may see as a conflict of interest is, for them, money in the bank.

UNIDENTIFIED MALE: His brand has become stronger, more global. We're definitely benefiting out of that.

THOMAS: During the campaign, Trump pledged to leave his business interests behind.

TRUMP: If I become president, I couldn't care less about my company.

THOMAS: But since the election, Trump, from his penthouse office in New York City, has used the power and prestige of the presidency to promote his business interests. He took time to meet with the Indian developers of two Trump Towers in their country, who posted this picture and then took it down.

He complained to a British politician about wind turbines near his Scottish golf course. And the president-elect made sure to include his daughter Ivanka in a meeting with the Japanese prime minister, just as she is in talks to expand her clothing line in Japan.

With Trump investments or deals in at least 18 countries around the world, even those whose advice has been sought by the transition office say the president-elect is leaving himself open to serious conflicts.

PETER SCHWEIZER, AUTHOR, "CLINTON CASH": You're going to have foreign entities, foreign governments offering sweetheart deals in the hope of favorable action from the president of the United States.

THOMAS: That may already be happening. At the new the luxury hotel in Washington, DC, which seems to be the new in spot, the place for foreign governments and special interests to show loyalty to Donald Trump.

Earlier this week, the kingdom of Bahrain rented out the presidential ballroom at an estimated cost around $100,000 to celebrate its national holiday. So we showed up to ask why here?

(on camera): Last year, you were at a different hotel.

Is this because Mr. Trump is the president-elect?

UNIDENTIFIED MALE: I have no comment.

THOMAS (voice-over): The wealthy kingdom of Bahrain certainly has good reasons to court the incoming Trump administration. Its human rights record has been harshly criticized by the U.S., accused of torture, even threats of rape and other violence against political opponents.

Outside, as Bahrain diplomats left, they still weren't talking.

(on camera): You don't want to say anything at all about...

(voice-over): And security men blocked our cameras.

Trump says the hotel will become even more valuable, since he's going to be in the White House.


All you have to do is follow the money and if you follow the money, it leads right back to Donald Trump's pockets.

THOMAS: And this coming week, as Trump announces his plans to resolve conflicts of interest, the government of Azerbaijan will be spending big money here to throw its own holiday party.

For THIS WEEK, Brian Ross, ABC News, Washington.


STEPHANOPOULOS: Thanks to Brian for that.

I'm joined now by ethics counsels for our last two presidents, Norm Eisen for President Obama, Richard Painter for George W. Bush. Welcome to both of you.

And Mr. Eisen, let me begin with you. You've -- it's pretty clear that Donald Trump is not going to divest. You've heard Rand Paul say that they think it's unrealistic. Why do you think he must? Norm Eisen.

AMB. NORM EISEN, FORMER OBAMA CHIEF ETHICS LAWYER: Donald Trust -- Trump must divest, George, because of his web of domestic and international business relationships that create a conflict of interest for him.

He's moved to admit that there is a conflict of interest now and he needs to do something.

STEPHANOPOULOS: Even though the law does not -- says the president does not come under the conflict of interest laws?

EISEN: George, "The Constitution" has something called The Emoluments Clause. That's just a fancy, 18th century word for no foreign government payments. And Donald Trump is collecting foreign government payments and other benefits throughout his business.

It is a direct violation of "The Constitution" and unless he divests, not just operations, he must divest from all business interests or he will be in violation of "The Constitution" from day one.

STEPHANOPOULOS: Even if he turns it over to the family -- his family and executives?

PAINTER: If he retains the ownership of the businesses and those businesses take money from foreign governments, in transactions with foreign governments or corporations controlled by foreign governments. He will be in violation of "The Constitution," regardless of who's managing the businesses. It's about who owns them.

STEPHANOPOULOS: But what -- but what's the -- what's the remedy here?

It's only -- only the Congress can take this on, correct?

EISEN: Well, there's going to be a lot of remedies. He's also subject to other conflicts laws, George. The bribery laws are intended to prevent conflicts, for example. He's subject to criminal law. He's subject to civil law. He's going to be subject to litigation. He's already in a lot of cases. This is going to come up in existing litigation and there's going to be new litigation.

People are studying whether there's a cause of action that competitors, for example, would have if they're harmed by these foreign government payments.

He's going to be tainted by scandal. Congress hangs by just three Republican votes. If he loses three Republicans, you're going to see investigations, subpoenas.

So he faces a lot of problems.

Why go there?

STEPHANOPOULOS: Immediately, you've got this issue of the hotel in Washington. The lease is held by the General Services Administration.


STEPHANOPOULOS: The president will pick the head of the General Services Administration. So he's both tenant and landlord at the same time?

PAINTER: Well, yes, and that's one of the many situations where there are going to be conflicts of interest. There are National Labor Relations Board cases involving Trump properties. And then we have the broader conflicts of interest. He owes hundreds of millions of dollars to banks.

How do we expect the Trump administration to regulate the financial services sector?

Are we going to have another bubble where real estate prices go up, along with bank stocks for a while, until there's a crash, and everybody suffers because of it?

He needs to focus on being president. The president is not an inn keeper. He is not a celebrity talk show host or reality star host. Let somebody else do those jobs.

I think Bush is looking for a job. Maybe he could take over "The Apprentice."

EISEN: And George, there's a Russia angle to all this, because remember, we don't have Donald Trump's tax returns. He did a very -- relative summary, 104 page campaign financial disclosure. One year of tax returns, reportedly -- we've seen the pictures, 12,000 pages. And tax returns are replete with his foreign interests, including, perhaps, his Russian interests. That may be the reason he doesn't want to turn over his taxes.

You've got to disclose partnership information, names of partners, custodians, foreign accounts.

So with the new Russia allegations coming to the fore once again, the conclusion of the intelligence agencies, we've got to have those taxes to evaluate whether these conflicts go to the heart of our most pressing national security interests.

STEPHANOPOULOS: It appears that the direction he's heading, as we talked about, is turning over the operations to his children, to other executives, and setting up some kind of a mechanism, a board, perhaps within the White House counsel's office, to review any possible conflicts as they come up, deals that his children may have.

Why can't that work?

PAINTER: Well, George, the problem with that is that if he owns the businesses, all of the conflicts remain with him, regardless of who is managing the businesses. He owns the company. The foreign government pays money into the company pursuant to any type of contract or a loan from the Bank of China and he benefits from that, we have a violation of "The Constitution." It doesn't matter who's running the companies.

And these firewalls aren't going to work. That isn't going to be an appropriate function for the White House counsel's office, to be policing firewalls within the Trump business organization.

It won't work. The focus for him needs to be on being a good president. He can take these companies public or find private buyers. He can covert these companies to cash. He'll have a couple of billion dollars. He can give some of it to his kids, give them a good start. And he can focus on being a good president. and that's what he ought to do.

STEPHANOPOULOS: We will be watching the announcement this week.

Gentlemen, thank you both very much.

EISEN: Thanks, George.

PAINTER: Thank you very much, George.

STEPHANOPOULOS: And we'll be right back with our Powerhouse Roundtable.


STEPHANOPOULOS: Trump cabinet filling out. His clash with the CIA. A whole lot to talk about with our Powerhouse Roundtable.



DWIGHT EISENHOWER, FORMER PRESIDENT OF THE UNITED STATES: In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex.

The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes.


STEPHANOPOULOS: The farewell address of President Eisenhower right there. A lot to talk about on our roundtable, including Rich Lowry, editor of the "National Review;" "Washington Post" columnist E.J. Dionne; Democratic strategist Jamal Simmons and Republican strategist Sarah Huckabee.

And, Rich, let me begin with you.

Donald Trump's top appointments so far, I think you have got eight CEOs and bankers, three generals.

So is this what Ike had in mind?

RICH LOWRY, EDITOR, "NATIONAL REVIEW": Well, he -- clearly Trump likes the way business executives and generals think and talk much more than policy professionals.

And from where I sit, it's a superb cabinet so far. A lot of these choices could have been made by Ted Cruz. So you're going to have this shotgun marriage between a very orthodox Republican cabinet and a very unorthodox.


STEPHANOPOULOS: How does Rex Tillerson fit in there?

LOWRY: I would like to see someone with more traditional foreign policy experience and, obviously, his views and attitudes towards Russia will be a big part of the confirmation hearings. But ultimately he will reflect Trump's policy towards Russia, which will be friendly up right up to the point of time it isn't.

And it's worth remembering George W. Bush, Barack Obama also came in thinking they had the magic key to better, warmer relations with Russia; those efforts ended in tears. And I would expect the same here --


STEPHANOPOULOS: -- I take it you're not as reassured as Rich?

E. J. DIONNE, "THE WASHINGTON POST": I'm not somehow. First of all, thanks for playing that Ike speech. It's one of great speeches in American history. And I wish we had more Eisenhower Republicans in this Trump cabinet.

I mean, what's really striking here is that a candidate who ran as the Paladin of the working class who'd deliver them picks a guy who heads a fast-food company, Trump says he wants to bring back manufacturing.

Here we have Mr. Posner (ph), who doesn’t -- is not wild about labor protections. And you have this all the way through this cabinet so that I think there are a lot of other things to worry about Trump. But in conventional political terms, this is a cabinet that I think is going to have a very hard time delivering to the base that Trump courted in this election.

STEPHANOPOULOS: And that's what I want to ask you about, Sarah Huckabee, you do have all -- these are the kind of people that Trump actually attacked during the campaign, especially Goldman Sachs.

Is there a risk that his base is going to feel betrayed?

SARAH HUCKABEE, REPUBLICAN STRATEGIST: I don't think so at all. I think the big common denominator between all of these cabinet picks are that they're actually people that have gotten things done. These are executives; these are leaders; these are pragmatic doers.

They're not think tank theorists. They're not people that have sat around and come up with big ideas and talked about them. These are people that have turned around companies, put their lives on the line and really made big reform, big change and accomplished big things.

That's everything that Trump campaigned on was coming in, changing things, shaking things up and getting things done. And that's exactly what I think this cabinet says about the type of president we're going to have.

STEPHANOPOULOS: And, Jamal Simmons, even though the president-elect is talking a lot to President Obama, you look at some of these picks, especially Greg Pruitt (ph) for the EPA, the Oklahoma attorney general. They're coming in to overturn a lot of President Obama's legacy.

JAMAL SIMMONS, DEMOCRATIC STRATEGIST: They're going to come in and try for sure. I think the thing that -- what we don't know is there's a reason why people are successful who are in politics for a long time. There are skills you learn. There are ways you learn to behave.

Sometimes the shortest route between point A and point B is to go through C and D first, you got to go a little sideways before you can go forward. And I'm not sure that corporate CEOs and generals are prepared necessarily to do that.

And we talk about the cabinet; I think Democrats are going to face a choice. We can't fight every single one of these. And if we're outraged about everything, nothing will be outrageous. So we have got to figure out which one of these secretaries we're going to take a stand on.

My vote would be for somebody Jeff Sessions. I think Jeff Sessions in particular, say it's six months after the tragedy that happened in Tulsa or in Orlando, after that, Loretta Lynch, the attorney general, went to Orlando and said to the folks down there, the LGBT community, that I will stand with you, the Department of Justice will stand with you in the light.

Do we think that the Department of Justice will still be standing with those people with Jeff Sessions as A.G.?

I'm not sure that they will.

STEPHANOPOULOS: Let me press you on that.

Do you think there's any realistic chance of stopping Jeff Sessions when he's been in the Senate for a couple of terms?

SIMMONS: You may not be able to stop him. We got to raise the heat on that. I think that's the kind of thing that particularly Democratic forces want to see Democrats fight on, somebody who's said nice things about the KKK, somebody who's been against LGBT issues.

That's something that Democrats want to see them fight on.

LOWRY: The case against Jeff Sessions was threadbare three decades ago. It's based on hearsay and innuendo and a joke he made about the Klan.

I think likelier targets are Mnuchin, the Treasury pick. When you look at his dealings during the financial crisis, that's going to be a target rich environment, and Tillerson.

But I think just focusing on the wealth of these cabinet picks misunderstands Trump's economic strategy here, which is going to be equal parts traditional Republican economics. We're going to cut taxes, deregulate to try to create general pro-growth conditions, at the same time, much more than any other Republican ever before, he's going to focus on trying to tighten the labor market directly through discouraging outsourcing and tightening up on immigration, all towards the goal of actually increasing wages, that's a new focus for the Republican Party and a very important one.

DIONNE: But, you know, the idea that it's not just about the fact that these guys are billionaires, it's also the policies these billionaires happen to want to put in place.

And on the question of opposition, I think there are -- when you want to send a signal if you're on the Democratic side that this is a very right wing cabinet at odds with so much of what Trump said. And it's also going to be fascinating to see if your Republican Party in the congress actually goes along with those aspects of the Trump plan that are designed to raise wages.

LOWRY: He campaigned on repealing Obamacare. He campaigned on an enormous tax cut, and he campaigned on a deregulatory agenda.

STEPHANOPOULOS: Yeah, but you just see -- he's also talking about infrastructure, and you just heard Rand Paul say if the budget increases the debt or deficit there's one no vote to begin with.

Let me move on to this question of Russia and the president-elect's dispute with the CIA. Pretty extraordinary what he's saying about the findings of the intelligence community, saying he doesn't believe them, doesn't trust them, saying he doesn't need -- he was doing this on Fox News Sunday this morning, saying he's a pretty start guy, doesn't need the presidential daily brief every day.

Is he on a collision course with the intelligence community?

HUCKABEE: I don't think so. I mean, look, and you had his soon to be chief of staff Priebus on earlier, said they have confidence in these agencies. I think that he is taking a lot of this information in. But at the same time when you have intelligence agencies leaking information and perpetuating a story that frankly isn't true and there's nothing to substantiate in terms of the RNC being hacked and things like that, there is cause for concern and questions.

STEPHANOPOULOS: But Rich Lowry, it's not just the leaking. I mean, you heard Reince Priebus there, back in October, this was a public statement by the intelligence agency saying Russia was behind it. President-elect says he just doesn't believe it.

LOWRY: Right, there's no point trying to sugar-coat this or get Jesuitical (ph) about it. Yes, Russia tried to manipulate our election. Yes, it's appalling. Yes, it should be investigated and taken seriously.

But I do think -- you look at actually what WikiLeaks came out with, most of it was just gossipy interest, except for like this Doug Band (ph) memo from a Clinton crony in black and white who explained the Clinton Foundation was a profit center for Bill Clinton and people around him.

The Russians didn't make that up, that was all Hillary's vulnerability her own.

DIONNE: But the Russians stole it from the Democratic National Committee with hacking.

I think this is a scary thing that does have to be taken out of a partisan context. And one of the best pieces of news this morning is a joint statement, Senator Schumer, Senator Reid for the Democrats, McCain and Graham from the Republicans, saying we have to get to the bottom of this.

And I think there are a lot of Americans who are very scared, scared that Putin manipulated us, worried about Rex Tillerson, the winner of Russia's order of friendship as the secretary of state. And very scared that Donald Trump and his campaign, or his future administration, is just in denial. They just want to say, no, no, no, Putin couldn't possibly have done this.

It sure looks like Putin did this. And we all need to take this seriously.

SIMMONS: And George, what's really concerning to me is it seems like we have somebody who is going to be the captain of our team, but he's spending more time going to pep rallies than he is going to practice. So, the problem here is you have got people like Susan Rice who says she's just meant her counterpart for the first time last week. Lisa Monaco (ph) on Friday said she had not met her counterterrorism counterpart yet from the Trump organization.

The president himself is not getting security briefings on a regular basis. I mean, at some point just an American, don't we want this team to be ready to take the handoff of the baton from the Obama administration and be able to protect the country from the threats that we face?

HUCKABEE: Absolutely.

And going back to what EJ said, it's not about denying that maybe there was an existence. I think the bigger question is the Democrats want to say the reason Trump won is because this happened, and that's frankly just not true.

It happened because Hillary Clinton was a terrible candidate and Donald Trump actually had an economic message.

SIMMONS: This is not about Hillary Clinton anymore. This is not about Hillary Clinton anymore.

HUCKABEEE: And that's going to bring me into my second point, whose fault was it? It wasn't like Donald Trump was in charge of cyber-security at the DNC, if anybody is to blame it's the Democrats, it's President Obama. His administration did not take cyber-security seriously. They did nothing to help stop this. They were in charge. And if there's anybody to blame, it's the Democrats, not Donald Trump.

DIONNE: ...candidate who said he has more confidence in Vladimir Putin's strength than in Barack Obama's strength. His closeness to Putin is a very scary thing for the country and the fact that the news was dominated for 33 days I think it was by WikiLeaks stories, that had an impact on states that were decided by a knife-edge.

STEPHANOPOULOS: Let me bring this back to Rich on this. I mean, and then you see this possibility of Rex Tillerson, going back to one of my questions, it seems like he could be in for the roughest ride of everyone?

LOWRY: Yes. Because you are going to have Republican hawks like John McCain and Lindsey Graham who are very skeptical of him. At the same time the Democrats will portray him as a climate criminal because he heads a big oil company. So, he'll be in for really tough confirmation hearings.

DIONNE: But the closeness to Putin will be one of the unifying issues between the Republican critics and Democratic critics.

SIMMONS: There's a real question, I think -- listen, we lived through a week when Fidel Castro died where everybody, every single Republican went on television and talked about Fidel Castro being a thug and a bully. But when you ask them questions about Putin -- you asked Reince Priebus questions about Putin, Priebus never said Vladimir Putin is a thug and a bully and we ought to do whatever we can to contest him. He never said anything that strong.

I think there's a real question about this administration. Is it going to be a pro-Putin presidency? And Rex Tillerson is going to have to face a lot of the questions about that.

LOWRY: I think all of us in the commentary business need to take a deep breath. And it can't be true that every single week the world is ending in some different way. And this presidency will be judged like all presidencies -- on the state of the economy and by events.

HUCKABEE: I couldn't agree with him more. And right now the state of the economy since Donald Trump has been elected is better than it's been in a long time. And so I think that we're moving in the right direction.


HUCKABEE: And let me be very clear, this is not a pro-Putin presidency, it's a pro-America presidency.

SIMMONS: We'll see.

HUCKABEE; That's been the number one priority throughout the campaign, through every decision, every appointment he has made.


LOWRY: Were you appalled by the reset? Were you appalled by Obama's reset?

STEPHANOPOULOS: Guys, you're not going to be able to answer that question, because we are out of time. We'll have that on the next one.

Thank you all very much. We'll be right back.


STEPHANOPOULOS: And that is all for us today. Thanks for sharing part of your Sunday with us. Check out "WORLD NEWS TONIGHT". And I'll see you tomorrow on "GMA".

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