robert: the economy rnd so does the trade war. president trump claims his policies are responsible for an uptick economic growth. and his critics wonder, is it sustainable. i'm robert costa. we talk trade, taxes, and have the latest on mr. trump's former lawyer, michael cohen, tonight on "washington week." ent trump: i am thrille to announce that the united states economy grew at the amazing rate of 4.1%. we're on track to hit the highest annual average gro rate in over 13 years. robert: president trump touts a surgingconomy that grew during the second quarter at the strongest pace in nearl four years.ls he took a victory lap over his recent trade discussions with the european union. president trump: as the trade

deals come in one by one, we're going to go a lot highe than these numbers. robert: some republicans on capitol hill are increasingly wary of the president's news, saying the just-announced $12 billion in aid for i farmerss a federal bailout that proves the president's policy has limits. >> i don't think tariffsri are e t answer. i don't support tariffs. robert: leaders of the house freedom caucus call for the impeachmt of deputyy attorne general rod rosenstei who oversees the ongoing russia probe, a move the attorney general doe not support. >> my deputy, rod rosenstein, is highly capable. robert: plus,'s mr. tru long-time attorney, michael cohen, accuses the president of having prior knowledge about 2016 meeting at trump tower that included his son, campaignvi rs, and russians who were offeringti incrimi information about hillary clinton. president trump: just remember,

what you're seeing and what you're reading is not what's happening. robert: we cover it all nt. announcer: this is "washington week." corporate funding is provided by -- newman's own foundation, donating all profits from newman's own food products to charity and nourishing the common good. koo d patricia yuen through the yuen foundation, committed to bridging cultural differences in our communities. the ethics and excellence in journalism foundation. the corporation for public broadcasting, and by contributions to your station from viewers like you. thank you. once again, from washington, moderator, robert costa. robert:good evening. president trump held up today's 4.1% growth report as vindication of his economic policies and the president insisted the second quarter numbers are not a one-shot

bounce. president trump: as the trade deals come in one by one, we're going to go a lot higher than these numbers.um thesers are very, very sustainable. this isn't a one-time shot. robert: but the administration's tariffs are sargt to -- starting to rattle some farmers in the midwest and elsewhere, who are seeing a decrease in international sales.ma republicans say the $12 billion assistance plan for the instry is not enough, or a long-term solution. >> this is coming from the effect of what the administration has done and it's aonition that tariffs are harming agriculture and harming farmers. so it's not what they prefer. robert: but the pre dent has pulled back from an all-out trade war with the european union, agreeing to adjust his proposals. president trump: tas a very big day for free and fair trade. we agreed today, first of all, to work together towards zero tariffs, zerof non-tar

barriers, and zerodi sub on non-auto industrial goods. robert: joining me tonight, ana swanson of "the new york times," welcome to "washington week." josh green of "bloomberg businessweek,"cbancy cordes of news, and vivian salama of "the wall street journal." ana, is great toave you here at our roundtable. the president took a lot of edit today f these growth numbers. can he take credit for this economic growth? ana: that's right, he did. in general, i think presidents tend to take too much cre tt in goes and in bad for the cycles that the economy goes through. we arey seeing v strong growth right now. 4.1% in this quarter, and g.d.p. erowth this year could rise to 3% for the first t in over a decade. so those are very strong numbers for theresident. on the other hand, the question is, how long do these numbers last. i think some of this is the

effect of the tax cut and economists see that fading somewhat into next year. and then also we had some very interesting numbers with trade, as well, with the trade tariffs increasing growth nowot butn the way that the president probably wanted. actually pulling forward purchases so people were trying oo buy goods ahead of those tariffs going iffect so that's likely to drop off, as well, in coming quarters. robert: you're saying maybe there's a frenzy of activity before next quarter.l so w this frenzy of economic , bevity, all this growth sustainable if people are buying now to do different deals before theariffs kick in? joshua: trump says yes. mostly economists say no. as ana alluded to, a lot of foreign buyers of u.s. agricultural goods like soybeans moved forward t purchasesy would have been made in the third quarter into the second

quarter in anticipation that the products will be hit by tariffs, as they were july 6. so thatit added ae bit over 1% to g.d.p. growth which gave us this b headline number today. but if you think forward to the next three months, those gone, they'venow already happened. so it's going to be tough for trump to figure out how to fill that gap and produce, as he says he will, a susta table number i 3%, 4% range. ngbert: we have been loo at reports from different campaign forecasts and democrats seem to be gaining momentum ahead of midterm elections but m republicant like this report as they try to tout the tax cut and rally ahead of november. rncy: they'll take it regardless of tson for the surge. they can get on the campaign trail, republicans heading hom for the five-week recess in the house. and they'll be -- talking about 4.1% everywhere they go. that's a great number for them and even if it doe fall off in the third quarter, that's only two weeks beforehe midterm

elections. many people have made up their minds by them. the problem for republicans is th people ten to vote more on whether wages are risg falling than what the overall g.d.p. looks like. that's aumber that people don't really feel. and wages have basically been stagnant if you think back to 2014, president obama had great g.d.p. numbers, even better in the second and third quarter. and democrats did terribly in those midterm elections. they lost control of the senate. happy: so the president out these numbers but he's also getting some pushback from publicans on trade. we saw some movement this week. you were at the white hse, vivian, reporting on the west oing, deep inside, about how the president seemse taking a few steps back on trade with his deal wit the e.u. vivian: unlike af meetings where they go into the meetings, a lot of details are already ironed out. this was touch-and-goil uhe end and it was fascinating to

watch and report on where literally as of tuesdayht n they started to say, wait, maybe we can come together and work something out. all through their meetings on wednesday, between president trumpnd the european commission president, jean-claude juncker, it was unsure until the end if theyold theyold -- they would really do it so president trump excited they were doing a deal, helping farmers. he didn't go into theex meetings cting that much. so the white house was really excited about that and, especial a, because they could deliver something to the republicans who are nowo going back t their home states, campaigning ahead of midterms, but also coming off o a really rough week last week, a lot of backlash after the president's meetings wit president putin in helsinki. they felt this turned things around for them so it was good momentum for them to go in and now g.d.p. numbers coming out today cap off the week for them. robert: what's actually in the deal with the e.u.?

it an actual deal? sometimes the details matter, not just about the president claiming credit for a broad roke agreement. >> both the americans and europeans called this a deal but i would characterize it as a deal to tk about a deal. the details were vague right now. the highlights were that the president said the european union had agreed to purchase more natural gas and more soybeans. we have toow seexactly that would work and when those purchases would go into effect. in addition, the two governments will talk about reducing tariffs on a varietyf goods, including industrial goods. and then the two sides also agreed to talk about reforms at the world trade organization, a lot of which seemed specifically aimednat c and many interpreted that as a good sign that the unitedndtates european union were on the same side with regard to china's unfair trade practices. robert: that's one high level,

josh, about where this trade debate's going and the president working with the e.u. but what about down where it matters for people day-to-da it's not just the midwest. it could be lobstermen in maine dealing with the effec of the trade war. joshua: i think the immediate effects of trump's trawi war not be economic in the macro sense. most economists recently worried yet about the trade war because the tariffs are a small percentage of the overall u.s. economy. where i think it's going to hit is i individual states and industries, especially states that voted for trump, in all sorts of localized areas. so we've heard about soybean farmers in iowa. certainly it hurt there. but these tariffs are spread across many industries. you mentioned lobstermen in maine, subject to a chineseoo se tariffs but the lobster traps are now more eensive as they're made with canadian steel so across the country, alaska, south carolina, places where

there are competitive house races this fall, the tariffs are localized issues in a way thatut voters absy see and feel. robert: why aren't rkiublicans spea out more publicly? we hear it, nancy, privately. the free trade republicans, they don't like where this is going. but they're reluctant to say much. i nancy: it'eresting because on the campaign trail you're starting to hear democratic challengero say you've got get off the fence and say where you stand on this and south carolina is a perfect example because the entire south asrolina republican delegation hasally either stayed mum or has said, you know what, maybe you need some-t shom pain for long-term gain, the president is going to negotiate something ttet is bin the long run for u.s. businesses. the problem is that he has shown lian a to start a lot of negotiations over all types of immigratitrade a and everything else. not as much of a track record on completing negotiations. joshua: this is what republicans prately sayhey're very worried about.

they're furious that trump started this m fight fourths before the midterm elections and what you see, anecdotally, talking to auto workers and farmers, many are stickingith trump, giving him room to negotiate. but we need to watch, do the farmers and auto workers peel away as the bite of the tariffs start to make an impact.: robeat about the $12de billion t package? ana: it's a lot of money but no one's convinced it will yield a solution. yes, it's before the midterm electionsut president trump says he feels congress is undermining his authority to make tse trade deals and when they push back and don't trust his instincts to go for the long-term deals, he feels they're basicallyg try to derail any of his efforts to help these voters down the line. robert: final throughout this, ana, the president may be having a hand shake with the e.u. but

his trade war with china seems to continue. ana: that's right. there arenrade wars o many fronts right now. we've seen a step back with the european union.ve ho that could be a temporary step-back and meanwhile, we still have negotiations over the american free trade agreement with canada and mexico and a potentially damaging conflict with china that needs to beed reso so there's a lot on the administration's plate with trade. robert: are those countries expecting any movement? they see the movement with the e.u. do they expect a move before midterms on their own agreements? ana: potentially, there is discussion about trying to finish the nafta agreement before the end of august but it's sti pretty much up in th air. it's possible this could prove to be a blueprint for these other agreements but it's also possible that other negotiations could be a blueprint for how this goes. did see with china, the two sides come tohat seemed like

tentative agreements and then actually have the president decide those weren't tough enough measures and walk them back. could that happen with theas e., well? we'll have to see. robert: you had great piece, vivian, about how everyone's trying to evaluate president trump, how do you get him to budge on the signature issue of trade. we'll come back to this next week. let's turn our attention to ne york city, the saga of michael cohen, the president's long-time wyer and loyal adviser, who is now signaling his willingnesso cooperate with federal investigations looking into russian interference in the 2016 election. >> mr. cohen -- robertcohen is under siege, under federal investigati in the big apple for bank fraud and the f.b.i. is looking into hsi ss dealings in new york. his break with the president has been dramatic. a week ago, the "new york times" reported that cohen secretly

recorded a conversation with then-candidate trump in which they discussed paynts to a former model who said hhead an affair with mr. trump. the tape is one of many the f.b.i. seized in a raid on cohen's office earlier this year. then, last sunday, cnn obtainedw that recordi talked about and broadcast it. mr. cohen could beeard briefing mr. trump on financial arrangements and mr. trump is engaged in the discussion. here's why all this matters. trump's camign ahead ohe election had denied the candidate had any knowledge of payments to the model, karen mcdougle. it also raises questions aboutam possibleign finance law violations and it shows cohen is willing to share tapes of his old boss. josh, we have been covering president trump for some time. we would go to trump tower, there would be michael cohen, theeeixer. to him break like this and release the recording, what does it mean f this white house? joshua: it's shocking, first of as beencause cohen

associated as trump's fixer, protector, lackey, and attack reporters,ing with going back years. so the fact that he's broken a is openly flouting the material he declines have on trump -- claims to have on trump, not o just the tape but according to cnn, over 100 tapes of recorded conversations, means he's potentially a very valuable witness against trump should bob mueller, special counsel, and investigators, decide to bring him in and offer him a deal to testify or provideamaging material about trump. robert: is the white house considering a pdon, vivian, when they watch this spectacle, they watch cohen make these moves? vivian: frankly, they don't want to touch the issue. every time we, andef they us to president trump's outside counsel, rudy giuliani, and others.g, frankly speak though, it's fascinating to the watch because it's like what josh was saying, this was the man who a year ago

was saying he would take a bullet for president tnd now we see him turning in this way. but president trump, takes loyalty very seriously. and something like this, som sne who waso loyal for so long, could really, yout know, j upset him in a way that we've not seen before and question those who are closest to hime beca they could flip. nancy: what's reall amazing about this saga is it's such a stark reminder that so many people who were involved feel so little responsibility to the truth. michael cohen, after don jr. was interviewed, said i'm so glad he told the entir truth about his meeting in trump tower and obviously the president knew nothing about it. now michael cohen said, actually, the president didbo kw all it. rudy giuliani, a few weeks ago, said, michael cohen is an incredibly honest man. i trust him. now he says, he's been a liars entire life. you know, when you're hearing

this -- from both sides -- it makes it very difficult. robert: trying to kee him contained and he explodes out with this information. nancy: but at the same time if people are willing to change their stories -- not a little bit. this is not tweaking around the margins. ese are 180-degree turns and it really makes you wonder who, if anybody, is telling the truth. joshua: to me it makes the existence of tapes all the more important because as s youd, you've had rudy giuliani calling him a great lawyer, a terrible lawyer. au've had cohen defending trump, then goiinst him. i'm not sure who's really got credibility to be able to testify but if there are tapes, something investigators can draw on to establish contemporaneous happene what actually i think that's important. robert: there aren't tapes about one of the big things that came out. cnn reported that michael cohen has knowledge of president ump's awareness, his prior knowledge, cohen alleges, of the

2016 meeting at trump tower where donaldrump jr. met with russian figures and discussed dirt on secretary clintmp's gn. cohen is now saying he's aware of some exchange between donald trump jr. and then candidate trump afut the occurrence that meeting in the summer of 2016. president trump issued a rebuttal via twitter on friday that read "i did not know of the meeting with my s, don jr., sounds like someone is trying to make up stories." cohen is facing bank fra investigation into the southern district of new york but another thing caught my interest. i know cohen's the headline for most of us butlan wiseleburg, long-time c.p.a., accountant for the trump organization, gets subpoenaed to testify as part of the cohen investigation in new york and he has the keys the kingdomming in understanding the trump financial network worldwide. ana: he's been handling the family'sinances for decades,

including some of the campaign finances as well as the charitye in the t that you played, he's referred to as the person who is setting up that paymento and s he would have very deep trumpdge of the organization and its various activities abroad. we've seen a little bit of a dive into that withng repor from around the world as well as leaks like the panama papers, things like offshore financial accounts, shell companies. but, yeah, he's somebody who would certainly know where the financial bodies are buried. robert: that's the whole thing everyone's always wondering, the possible obstruction of jusce with president trump with the russia investigation and michael cohen and what he may know about what the president discussed tth donald trump jr. and it comes back to tmp organization, the tax returns. joshua: it's significant because trump said explicitly a year ago that mueller should not cross

the red line of invesgating trump organization finances and that's what's happening right now so this has to be a sourceat of g angst to the president. you wonder, talking to advisers, if this isn't part of what's fueling the twitter outbursts d theefensiveness we saw this morning when he claimed he didn't know anything about the meeting with don jr. and listen to him attack mueller on practically a daily basis. >> how far have we come from the days of nondisclosuregrments where the president guided all of his dealings withe nondisclosgreements and now it's coming out in the open, creating angst for the esident. robert: we still don't know if president trump will sit with robert mueller for an interview. i asked mayor giuliani this week, the president could provide clair 50 he sits down with bob mueller and mayor giuliani said we haven't knhead decision, it's aiad group. but that's the kind of thing we're waiting to see, if he'll sit dn with mueller. let's go to capitol hill because freedom caucus leaders in the

house g.o.p., mark meadows and jim jordan, introduced a resolution this week t amid controversy about michael cohen, to try to impch deputy attorneyst general rod rosenein whoe oversees th special counsel's russia probe, arguing rosenstein should be removed because of what they call a stone call from the justice department of subpoenas. after meeting with g.o.p. leaders, meadowsnd jordan backed off and said they would instead pure contempt of congress measures, falling below impeachment. of this is the latest example of g.o.p. leaders trying to contain thresident's allies on capitol hill as the russia probe continues. 's becoming a tough fight for speaker ryan with so much, ang you must be detecting, among trump's allies in the congress. >> sure but a lot of anger among republican rank and file that the freedom caucus members went oute. republicans have been arguing, don't elect democrats, don't let them lead the hse because all

they want to do is impeach president trump and then their ow members go ahead and say they want to impeach the deputy attorney general who was hired by president trump. so they didn't think it was a good look. they were very frustrated and meadows especially admitted to us on thursday that this was sort of a strategy to tray -- try to force republican leadership into collaborating with them on that lesser contempt charge. d.o.j. says we've given you thousands of documents. we can't give youvery document you want because some pertain to an ongoing investigation. freedom caucus members like w meadowt every document they can get because they're looking for evidence that this investigation was pursued wrong-headedly. sense --o you get a republicans think part of this effort is to remove rosenstein so that tru can fire bob mueller and stop the investigation? nancy: sure.

meadows insists that's not his goal, that he hasn't talked to the president about not encouraging the president to do that. but obviously, you know, there has been a concerted effort and it's not just on his part but there are a few people in congress who are really interested in looking for ways to discredit the investigation and the investigators. robert: when you're at the white hehouse, vivian, why isn't president, who says a lot of things on twitter, is happy rally against the mueller investigation, whye isn't h pushing to impeach rod rosenstein? is it because he'sth wary o obstruction of justice charge? vivian: conversations with his lawyers, everyone is saying tkeo a deep breath and let it play out without your interference andng gack to the experience with what happened with former f.b.i. director jim comey and how a l of people felt that was a potential violationlnd potent case of obstruction of justice, they're telling him to calm downndet it go for now but anything can happen

we're seeing this now, including with bob mueller looking at the president's twitter fds for possible obstruction of justice. at the end of the day, president trump i aloneith his phone lmetimes, he's tweeting without consulting hisyers sometimes so you honestly never know what to expect so it's not that surprising that mueller would look at the tapes. robert: how lon can this las paul manafort, former campaign chairman, his trial srts next week. michael cohen is making all these moves, a movement in the house to impeach rod rosenstein. it's up to bob mueller, that's the answer.ks th everybody, for joining us. our conversation will continue on the "washington week extr" 'll look back at secretary of state mike pompeo' congressional testimony this week and find white it revealed about u.s. foreign policy. you can find that later tonight at pbs.org/washingtonweek. i'm robert costa. thanks for joining us. an

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