UNIDENTIFIED MALE: THIS WEEK with George Stephanopoulos starts right now.
GEORGE STEPHANOPOULOS, CHIEF ANCHOR, ABC NEWS: Economic war.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I am the chosen one. Somebody had to do it. I’m taking on China on trade.
STEPHANOPOULOS: A dramatic escalation from President Trump on trade with China and his own Fed chair.
TRUMP: Do I want him to resign? Let me put it this way. If he did, I wouldn’t stop him.
STEPHANOPOULOS: The stock market dies after the president orders U.S. business to abandon China. And a week of zigs and zags on guns and taxes and Greenland leaves Washington reeling. Could Trump’s erratic approach encourage a recession and threaten his re-election? This morning, a challenge to President Trump from a fellow conservative.
JOE WALSH, FORMER ILLINOIS CONGRESSMAN: This guy is unfit. He lies every time he opens up his mouth.
STEPHANOPOULOS: Former GOP Congressman Joe Walsh preparing a White House run. He joins us live with a decision in a THIS WEEK exclusive. Plus the latest from the latest from G7 Summit with Jon Karl and our powerhouse roundtable with Chris Christie and Rahm Emanuel. And one year after John McCain’s death —
CINDY MCCAIN, WIDOW OF JOHN MCCAIN: Our country is — is not well right now.
STEPHANOPOULOS: Cindy McCain’s new mission. We’ll break down the politics, smoke out the spin. The facts that matter this week. From ABC News, it’s THIS WEEK. Here now, Chief Anchor George Stephanopoulos.
STEPHANOPOULOS: Good morning and welcome to THIS WEEK. I alone can fix it. That signature from 2016 pretty much sums up Donald Trump’s approach to the presidency and this week he pushed it about as far as it can go. With a dizzying series of impulsive moves on everything from buying Greenland to background checks on guns, tax cuts on and off the table, then back on again, a tax on China and the Fed that sent the stock market into a tailspin and threatened the strong economy that’s been his best selling point for re-election. And as we come on the air this morning, a new political threat, a potential challenge from one of his own. Conservative firebrand Joe Walsh, a Tea Party Congressman, now a talk radio host and no stranger to controversy and incendiary rhetoric.
Once a staunch defender of President Trump, he appeared on CNN this week and said this.
(BEGIN VIDEO CLIP)
WALSH: If Republicans, John, stay silent in the face of this guy, I don’t think the country will ever forgive the Republican party. But forget about the Republican party. If this guy gets four more years, we’re in real, real trouble.
(END VIDEO CLIP)
STEPHANOPOULOS: And Joe Walsh joins us now. Good morning.
WALSH: Hey, George. Good to be with you.
STEPHANOPOULOS: Have you reached a decision?
WALSH: Yes. And it’s great to be with you. I’m going to run for president and I’m to be on your show announcing my candidacy. George, no surprise, we’ve got a guy in the White House who’s unfit. Completely unfit to be president. And it stuns me that nobody stepped up, nobody in the Republican party stepped up. Because I’ll tell you what, George, everybody believes — in the Republican party, everybody believes that he’s unfit. He lies every time he opens his mouth —
STEPHANOPOULOS: You say that, you say everybody believes he’s unfit but one of the things the White House points to and the president points to often is just about every poll shows more than 80 support for the president among Republicans.
WALSH: They don’t have an alternative. I’ll tell you what, George — and look, I’m running because he’s unfit. Somebody needs to step up and there needs to be an alternative. The country is sick of this guy’s tantrum. He’s — he’s a child. Again, the litany — he lies every time he opens his mouth. Look at what’s happened this week. He is — the president of the United States is tweeting us into a recession. I can tell you, George, that most of my former colleagues up on the Hill, they agree privately with everything I’m saying.
STEPHANOPOULOS: But then how do you explain why they —
WALSH: Because they’re afraid.
STEPHANOPOULOS: — stand behind him so strong (ph)?
WALSH: Because they’re scared to death. They’re — look, George, this isn’t easy to do. I just sat down with you and said I’m going run for president, I’m going the challenge this guy. I’m opening up my life to tweets and attacks. Everything I said and tweeted now, Trump’s going to go after and his bullies are going to after.
STEPHANOPOULOS: You ready for it?
WALSH: Yes, I’m ready for it. Republicans are scared to death of that. Here’s what I think most of my former colleagues believe — they think Trump’s going to lose in November and they want him to lose in November. And then they think they’re done with him and everything can go back to normal.
STEPHANOPOULOS: Then they lost — then they lose the courts, they lost the Supreme Court, they lost the next vacancy, they lose taxes. That’s the argument the president has been making.
WALSH: They want Trump gone. They’re just afraid to say that he’s unfit. Look at this week. If you privately polled every member — Republican member of Congress, the president of the United States ordered private companies to not do business with China. The president of the United States said our Fed chair is as big of an enemy as China. Most Republican voters are tired of the drama. They’re tired of his BS. George, I believe this. Look, the — this —
STEPHANOPOULOS: You’re on talk radio. You’re on in the afternoon in Chicago. When you speak like this, what do you hear from your listeners? Support, correct?
WALSH: I hear support for the president. It’s difficult to be a critic of the presidents in conservative talk radio. But I hear real ambivalence as well. And I hear often, George, what you just said at the beginning, I don’t like him and I wish he wouldn’t tweet and I wish he would keep his mouth quiet, but we’re getting some good things done. But really what are we getting done?
And when I point to those people who listen to me on conservative talk radio we haven’t built one foot of a wall, that this president who said I’m going to eliminate the debt in eight years has increased the debt at a faster clip than Obama. But, George, this is not about issues. I would not be even thinking about primarying this president if I was upset with his position on the debt or the deficit.
STEPHANOPOULOS: There actually is another challenger to President Trump, as you know from inside the party, William Weld. And he had a tweet this week where he said this, he said “Donald Trump is a clear and present danger to our country, to the globe, and to himself.” And this is what got everybody’s attention, “#americadeservesbetter. #25thamendment.”
You talk about the president being unfit. Should the 25th amendment been invoked?
WALSH: It should be looked at.
George, we’ve never had a situation like this. You can’t believe a word he says. And again, I don’t care your politics, that should concern you. He’s nuts. He’s erratic. He’s cruel. He stokes bigotry. He’s incompetent. He doesn’t know what he’s doing.
George, he’s a narcissist. Everything he cares about, the only thing he cares about, is Trump. He doesn’t give a damn about America. He doesn’t care about the border.
You and I talked before I came on air, he lost me for certain at Helsinski.
STEPHANOPOULOS: The press conference with Putin.
WALSH: When the president of the United States stood in front of the world and said, I stand
with that guy and not my own people, that’s disloyal, that’s un-American.
His supporters, I think, are tired of this. Our campaign slogan, George, is “be brave.” Be brave. This is not a difficult thing for me to do. I’m opening up my life. But the bet that my campaign is making, and I’m going to pound Trump every single day. He’s a bully and he’s a coward and somebody has to call him out. And I cannot believe nobody in our party is calling him out.
But the bet, George, of my campaign is, that there are a lot of Republicans who feel like I do. They’re afraid to come forward.
STEPHANOPOULOS: You said you want to make the case against the president. The question is, are you the best messenger? You said you wanted to make a moral case against the president. Here’s what The Washington Examiner, conservative newspaper said in response to your potential candidacy this week. “There is the matter of his history of being Trumpier than Trump. He has made a living on peddling the same sort of demagoguery, conspiracy-mongering, and right-wing bomb-throwing for which he now condemns the president.”
WALSH: I helped create Trump. And George, that’s not an easy thing to say.
Look, we were divided before Trump. I went to Washington eight years ago, part of the Tea Party class, wanted to shake Washington up.
I got involved in the battles. And there were plenty of time where I went beyond the policy and the idea differences, and I got personal, and I got hateful. I said some ugly things about President Obama that I regret. And it’s difficult, but I think — I think that helped create Trump. And I feel responsible for that.
STEPHANOPOULOS: You did provide aid and comfort for the kind of things he was saying. You mentioned Obama. You called President Obama a Muslim, an enemy, a traitor. And you often spoke out on racial themes.
I want to show a couple of tweets that you had right there. Number one, “we lowered the bar
for Obama. He was held to a lower standard because he was black,” that was just in 2017.
A then a few months after that, not just President Obama, “Senator Kamala Harris said something really dumb. Meh. If you’re black and a woman, you can say dumb things. Lowered bar.” That’s kind of textbook racism and sexism.
WALSH: Well, again, the beauty of what President Trump has done is, George, he’s made me reflect on some of things I have said in the past.
I had strong policy disagreements with Barack Obama and too often I let those policy disagreements get personal.
STEPHANOPOULOS: Did you really believe he’s a Muslim?
WALSH: God no. And I have apologized for that.
And that’s not an easy thing to do, not at all.
But think about the contrast, George. Again, I’m bearing my soul with you right now on national TV. We have a guy in the White House who’s never apologized for anything he’s done or said. I think it’s a weakness not to apologize. I have — I helped — I helped create Trump. There’s no doubt about that, the personal, ugly politics. I regret that. And I’m sorry for that.
And now we have got a guy in the White House, George, that’s all he does.
Understand, I walk around with this piece of paper every day, George. It’s got all of Trump’s lies on one side, mostly updated, and then everything that he does that’s wrong.
I feel responsible for this. But I’m a conservative. And I think there’s a decent chance to present to Republican voters a conservative without all the baggage.
STEPHANOPOULOS: What’s the conservative case? Set aside the personal differences you have with President Trump.
STEPHANOPOULOS: What’s the conservative case for why President Trump should be replaced?
WALSH: He’s incompetent. He has no freaking clue what he’s doing.
He ran — he said he was going to build a wall, George. We haven’t built a foot of the wall. He said Mexico was going to pay for it. We haven’t. He told us trade wars are easy.
Tell that to American farmers right now. Tell that to American consumers.
President Trump said: I will eliminate the debt in eight years.
He’s increased it faster than Barack Obama did.
STEPHANOPOULOS: With the help of a Republican Senate and a Republican House.
Republicans and Democrats, neither one give a damn about the debt and the deficits. But this is on Trump. He said: I will eliminate the debt.
He hasn’t governed as a conservative. He’s not competent. He doesn’t know what he’s doing.
But, George, the bigger case is this. He’s not capable of being decent. He’s cruel. He’s bigoted. And he’s a narcissist. Everything is about him.
STEPHANOPOULOS: See, when you — when you talk to your listeners on radio, and you talk in these personal terms about President Trump, do they excuse it? Do they argue with you? Do they say it doesn’t matter?
WALSH: They say: But, Joe, the Democrats are socialists. I don’t like him. I don’t like what he says. I don’t like what he does. But the Democrats are socialists.
And I just — I don’t think that’s good enough. I — I’m not doing this to save the Republican Party. I’m doing this, George, because I think the country can survive Trump’s four-year tantrum.
But you give this guy another four years in the White House — right now, he is, George, literally tweeting us into a recession. He will tweet us into war.
STEPHANOPOULOS: But, as you know, presidents who face a serious primary challenge, Jimmy Carter, Ted Kennedy, George H.W. Bush from Pat Buchanan, hurt him — hurt him badly in New Hampshire — it tends to weaken them. They tend to lose.
Are you prepared to take responsibility, if you do well in this, for helping elected a Democrat that some of your viewers and listeners will say, oh, socialist?
WALSH: It doesn’t matter. Absolutely, I’m going to do whatever I can.
I don’t want him to win. The country cannot afford to have him win. If I’m not successful, I’m not voting for him.
I would rather get back to the place, George, where I’m sitting down next to a Democrat member of Congress and we’re arguing about capitalism and socialism, we’re arguing about ideas.
But, instead, we’re talking about a child in the White House who tweets ugly insults at average Americans every day. We’re tired of that. I want to get away from that. I want to get back to the policy.
STEPHANOPOULOS: William — William Weld has been out there for months not making much — much of an impact.
How can you run a real campaign? Where’s the money going to come from? Where are you going to focus?
WALSH: We’re going to focus on Iowa and New Hampshire.
We’re going to be on TV as much as we can. Again, be brave is our campaign slogan. I believe there are people out there dying to come out, stick their necks out, and say publicly what they believe privately, that this guy is unfit, he’s indecent, he’s setting a horrible example for millions and millions of American children every day.
I think this thing, George, will catch on like wildfire.
STEPHANOPOULOS: And if you’re wrong?
WALSH: If I’m wrong, it was the right fight, because somebody had to do this.
Again, George, we have somebody in the White House who’s not fit to be president. Everybody knows that.
STEPHANOPOULOS: Joe Walsh, thanks for your time this morning.
WALSH: Thanks, George.
STEPHANOPOULOS: Up next, Jon is Karl is live at the G7 summit, and FiveThirtyEight’s Nate Silver on the political impact of Trump’s trade war.
We will be right back.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Are you concerned about how the market is reacting to the tariffs?
TRUMP: No. The market’s doing great. And you people want a recession because you think maybe that’s the way to get Trump out. Maybe that’s the way we get him out. But I don’t even think that would work because, look, if there’s anything, it’s — you know, we’ve got to go into trade negotiations to get it right. We have horrible trade deals and I’m straightening them out. The biggest one by far is China.
(END VIDEO CLIP)
STEPHANOPOULOS: So will Trump’s trade war hurt him politically, maybe cause a recession? We’re going to get into that with Nate Silver in just a minute but right now I want to go live to Biarritz where the president is this morning for the G7 Summit. Our Chief White House Correspondent Jon Karl. The president making a lot of news this morning, Jon. Some news here as well. We just heard Joe Walsh saying he’s going challenge the president. Any reaction yet from the White House?
JONATHAN KARL, CHIEF WHITE HOUSE CORRESOPNDENT, ABC NEWS: Well, I asked the campaign about this. We got a word back from the communications director for the Trump re-election campaign. George, simply a one-word answer — whatever — when we asked about Walsh jumping into this race. Look, the president’s hold on the Republican party is as strong as it’s ever been. In fact, he is by far the most popular figure, Republican figure among Republicans in the country. There’s really no indication that he has any vulnerability whatsoever to a primary challenge. Which is why you’ve seen some of the bigger names who could have possibly jumped in, people like Mitt Romney or John Kasich opt not to jump in.
Although, Kasich says he is not ruling anything out.
STEPHANOPOULOS: And we’ll see if the president sticks to that one word response when he gets on Twitter perhaps later on. In the meantime, as I said, he has been making a lot of news this morning, including something that has seemed to surprise a lot of people, when he was asked if he had any second thoughts about the trade war with China. Here’s what he said.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Any second thoughts on escalating the trade war with China?
TRUMP: Yes. Sure. Why not.
UNIDENTIFIED FEMALE: Second thoughts?
TRUMP: Might as well. Might as well.
UNIDENTIFIED MALE: You have second thoughts about escalating a war (ph) with China?
TRUMP: I have second thoughts about everything.
(END VIDEO CLIP)
STEPHANOPOULOS: Now actually the president rarely admits second thoughts about anything, so that’s why this surprised so many people. But already, the White House backtracking?
KARL: Yes, this is something else. First of all, George, it’s important to say even before he got to that, it seemed like he was backing down. He talked about how he hopes to get a deal with the Chinese, that he believes the Chinese want to do that even more than he does. He said he wasn’t going to go forward with this idea of declaring a national emergency. So it seemed like he was trying to deescalate. But after these comments about second thoughts, the press secretary and communications director for the White House, Stephanie Grisham put out a statement and I want to read it to you, George.
It said, the president was asked if he had any second thought on escalating the trade war with China. His answer has been greatly misinterpreted. President Trump responded in the affirmative because he regrets not raising the tariffs higher. So while it looks like the president was trying to cool things down with the Chinese, we now have a statement coming out effectively throwing more gasoline on the fire.
STEPHANOPOULOS: So, a week of zigs and zags has one more zig as well.
In the meantime, this G7 — last year, you know, it was a fractious, fractious meeting. The president got into several fights, including with the Canadian Prime Minister Trudeau. It seems to — that that has created some lowered expectations for that G7 summit this time around.
KARL: Well, it sure has.
And even before it got started out, you had some back and forth, the president right before he left the White House on his way here, invoked the possibility of raising tariffs on French wines. The top official for the European Union was very critical of the president on a variety of issues while he was flying over here.
The president’s largely gotten a very warm reception, it’s been very cordial, very diplomatic. But George, what’s interesting is, usually these meetings, as you well know end with some form of a
joint statement. This time, even before this meeting got started, President Macron of France who is the host of the summit, said that there will be no joint statement. He said it would be pointless given the obvious disagreements with the president of the United States on a range of issues, including climate change, Iran and obviously trade.
STEPHANOPOULOS: Jon Karl from the G7 summit, thanks Jon.
So could the fallout from Trump’s China trade war stall the economy and sink his best shot at a second term? We asked FiveThirtyEight’s Nate Silver do you buy that.
(BEGIN VIDEO CLIP)
NATE SILVER, FOUNDER, FIVETHIRTYEIGHT: So trade policy doesn’t make for the most dramatic headlines. But I’d argue that Trump’s tariffs on China are a threat to his reelection. In fact, I think they’re one of the bigger risks he’s taken politically since taking office.
That’s because the economy has really been the thing that Trump has going for him. His average approval rating on the economy is about 52 percent compared to just 42 percent job approval overall.
But consider the potential economic impact of his trade policy. Bloomberg economics estimates the trade war with China, could reduce U.S. GDP growth by about 0.6 percentage points going forward. That might not sound like much, but since the last recession, GDP has grown by only about 2.2 percent per year. So, 0.6 points removes a lot of the slack we have from negative growth, meaning a recession. And in fact, economists are quite concerned about a possibility of a recession.
40 percent of economists surveyed now expect a recession in the U.S. by the end of 2020.
As you can imagine, recessions are really risky for incumbent presidents. You have to go back to 1980 to Jimmy Carter for the last incumbent president to face a recession at some point during his reelection year. He lost in a landslide to Ronald Reagan.
There was also 1992 when George H.W. Bush lost to Bill Clinton. The economy wasn’t technically in recession then but voters thought it was. Economists said not declare the 1990 to be over yet.
Of course, what does precede economic news, like other types of news? Through a partisan filter. Views on the economic are heavily tied to which party voters prefer.
But a recession would have tangible impacts that voters could see firsthand — family members getting laid off, stores and factories closing. So politicians can only go so far by calling a recession fake news.
And just one more thing, the tariffs on China aren’t really even good politics on their own terms. In fact, free trade is more popular than it ever has been. In 2015, 51 percent of voters thought that free trade was a good idea. But that’s up to 64 percent in the latest polling.
So, yeah, I do buy that Trump’s trade war is bad politics for him, but there’s one pretty big silver lining for the president, economists are really bad at predicting recessions. Historically they’ve shown almost no ability to forecast recessions more than about six to nine months in advance, so any assumptions about what the economy is going to look in November 2020 when voters are back at the polls are hazy at best.
(END VIDEO CLIP)
STEPHANOPOULOS: Wise caution there from Nate Silver. Thanks for that.
The roundtable is up next.
STEPHANOPOULOS: Roundtable is ready to go.
And all week long, you can get the latest on politics with breaking news alerts on the ABC News app.
We will be right back.