happening now, breaking news. close the deal. republican senator lindsey graham appeals to the president to stop provoking racial outrage and start negotiating an agreement to avoid a government shutdown. will mr. trump take his advice? complicit amnesia. the homeland security secretary accused by democrats of conveniently forgetting the president's vile language. we'll take you inside the hearing, where the questions were tough and the emotions were raw. steve bannon reportedly being ordered to appear before the special counsel, even as he's facing russia investigators in congress. this hour, we're learning about a new problem with bannon's testimony. and white house calls.

the president's doctor reveals the results of the president's medical exam, declaring he has no concerns about his cognitive ability. does this put to rest concerns about the president's mental fitness? we welcome our viewers in the united states and around the world. i'm wolf blitzer. you're in "the situation room." >> announcer: this is cnn breaking news. we're following breaking news. an open display of anger and frustration over the president's vulgar remarks about immigrants of color. republican senator lindsey graham alluding to mr. trump's crude language, says negotiations are turning into what he calls an "s-show," and he's pleading with mr. trump to close the deal. at a heated senate hearing, senator dick durbin reaffirmed he heard the president disparaging african immigrants

using what he calls a vile and racial tone. the homeland security secretary says she doesn't recall that language. that prompted democratic senator cory booker to accuse her of convenient amnesia and complicity. also breaking, steve bannon appears about the white house intelligence committee. "the new york times" reports that he's been subpoenaed to testify before robert mueller's russia investigation. our correspondents and specialists are standing by. white house correspondent jim acosta, the immigration talks are clearly a hot mess. >> reporter: they're running out of time, wolf. we had the white house doctor announce the results of trump's physical exam. he told reporters the president is in excellent health.

the president attempted to do some surgery of his own, cleaning up some comments he made last week about immigrants coming in from certain countries, comments that were described as racist. president trump tried again to clean up his comments on immigrants coming from what he referred to as shithole countries. visib visibly annoyed, the president snapped at the president's remark that he would like to see more immigrants from norway. >> reporter: is that true, mr. president? >> i want them to come in from everywhere. everywhere. >> reporter: just caucasian or white countries, sir, or do you want people to come in from other parts of the world, people of color? >> reporter: in another sign the white house has grown weary of the questions, two aides of the president shouted during another event with the president of kazakhstan. the president is insisting he's no racist and did nothing wrong.

he said senator dick durbin totally misrepresented what he said. >> this has turned into an s-show and we need to get back to being a great country. >> reporter: senator lindsey graham is still confirming the president made the remark. >> i won't talk about the meeting other than i know what i heard and i know what i said. >> reporter: graham appeared to be speaking through the media directly to the president, urging him to behave more like he did last week, when he appeared open to a bipartisan deal. >> this should be a bipartisan bill, a bill of love. >> reporter: graham blamed the new white house staff on his advisers, including his chief of staff. >> i don't think the president is well served by his staff. i think the president we saw tuesday, that that donald trump exists, and somehow, by 12:00 on thursday, something happened, and i don't think he was well served by his staff.

but he's responsible for the way he conducts himself, so do i, i can't blame that on the staff, but i do believe the staff was -- >> reporter: would that be general kelly? >> -- pretty much missed the mark here. i think general kelly is a fine man but he's also a part of the staff. >> reporter: the latest white house melodrama is unfolding days before a possible government shutdown. democrats want a spending deal that would protect young undocumented dreamers from deportation. the white house is demanding no strings be attached to the spending bill. in exchange for protecting the dreamers, mr. trump is insisting congress give him billions of dollars to build a wall at the border, tweeting "we must have security at our dangerous southern border and we must have a wall to protect us." the white house opened up a new reason why mr. trump is no bigot. >> look, i think that is an outrageous claim. and frankly, i think if the critics of the president were who he said he was, why did nbc

give him a show for a decade on tv? >> reporter: the white house responded to questions about the president's fitness for office, presenting the results from mr. trump's recent physical exam which included an assessment of his neurological health. >> his overall health is excellent. are there things he could do to make himself healthier with diet and exercise, absolutely. he's tracking that and i'm tracking that. but overall, he has very good health. >> reporter: white house dr. ronny jackson said mr. trump made a point of asking for a test of his cognitive abilities. as dr. jackson told us in the briefing room, the president passed that test. but the doctor also noted that is not the same thing as a psychological exam which of course was not performed during the checkup. >> thank you, jim acosta at the white house. let's get more on the fiery senate hearing featuring the homeland security secretary with questions about the vulgar language attributed to the president. our justice correspondent

jessica schneider is here. democrats aren't buying what homeland security secretary countrikristeirstjen nielsen cl she didn't remember what was said. >> they didn't buy it at all. the homeland security secretary stuck to her stance that she did not hear the president utter that curse word that's grabbed the most attention. of course that explanation does not satisfy democrats. >> reporter: homeland security secretary kirstjen nielsen under oath and under fire. >> president trump said the most vulgar and racist things i've ever heard a president of either party utter. >> did the president of the united states use that four-letter word in combination with any other words? >> you said on fox news that the president used strong language. what was that strong language? >> reporter: answering each version of the question virtually the same way. >> you were in the room. you're under oath. did president trump use this

word or a substantially similar word to describe certain countries? >> i did not hear that word used, no, sir. my apologies, i don't remember a specific word. i don't specifically remember a categorization of countries in africa. >> is it possible he said the word during the meeting and you didn't hear it? >> anything is possible, yes, ma'am. >> reporter: secretary nielsen set the scene inside the oval office meeting with lawmakers. >> the president used tough language in in general as did other congressmen in the room. what i was struck by was the general profanity used in the room by almost everyone. i remember specific cuss words being used by a variety of members. >> i'll going to ask you to say those words here. but i will just say for the record, senator graham spoke up in a way that i respect very much, countering what the president had said about countries in africa, reminding the president that his family did not come to america with

great skills or wealth, but they came here as most families do, looking for a chance to prove themselves and make this a better nation. and in defense of senator graham, his strong words repeatedly exactly the words by the president which you cannot remember. >> reporter: she also tried to explain the president's reported preference for immigrants from countries like norway. >> the prime minister telling him that the people of norway work very hard. what he was referencing is from the merit-based perspective we like to have those with skills who can acssimilate to the unitd states. >> norway is a predominantly white country, isn't it? >> i -- i actually do not know that, sir, but i imagine that is the case. >> reporter: after repeated questioning, secretary nielsen grew exasperated. >> sir, i've answered this. i've been very patient with this line of questioning. i'm here to tell you about the threats this country faces and the needs and authorities needed by the department of homeland security.

i have nothing further to say about a meeting that happened over a week ago. >> reporter: but democratic senator cory booker said he was seething and would not relent from the questioning, criticizing nielsen for not remembering the president's exact words. >> you're under oath. you and others in that room who suddenly cannot remember. you even say in your testimony that norwegians were preferred by him. excuse me, let me finish. >> i'm happy to. >> the commander in chief in an oval office meeting referring to people from african countries and haitians with the most vile and vulgar language. that language festers. when ignorance and bigotry is alive with power, it is a dangerous force in our country. your silence and your amnesia is complicity. >> reporter: now of course all eyes are on congress when it comes to a deal on daca. the battle is playing out in the courts. the justice department announced it will appeal the ninth circuit

ruling that blocked the president's efforts to end daca and mandatd that the administration resume receiving daca renewal applications. the doj today took that unusual step of appealing both to the ninth circuit and directly to the supreme court at the same time. wolf, this is really unusual. it really speaks to the administration's efforts to get a ruling, hopefully favorable to them, of course, as soon as possible. >> very interesting. thanks very much, jessica schneider. let's get to the breaking news on the russia investigation involving steve bannon, who is in the spotlight, reportedly under subpoena right now by the special counsel. our senior congressional correspondent manu raju joins us had of let's talk about steve bannon's testimony before the house intelligence committee today behind closed doors. what are you learning? >> reporter: wolf, it's been a contentious hearing that's lasted virtually all day long, after steve bannon refused to answer questions about his time with the trump transition after the campaign season, as well as

his time in the white house. now, he has said to have cited that he cannot answer those questions because of executive privilege. it's unclear if he actually asserted executive privilege at the direction of the white house. the white house itself would not say explicitly whether or not they told steve bannon not to answer key questions. but today, bannon would not disclose information that the committee was seeking about a range of topics, including what he knows about communications that the former national security adviser michael flynn had with the russian ambassador at the time sergey kislyak. it was so contentious that democrats and republicans on the committee agreed to issue him a subpoena on the spot to compel him to disclose information behind closed doors, according to a source familiar with the matter. another person, tom rooney, emerged and discussed the issue at play. he said, "i certainly think the

committee respects executive privilege. it's when does that attach, is the question that is sort of dominating the day." that was several hours ago. wolf, we do expect this to end soon and we expect congressman schiff to answer questions when this is done. he's been in there since 9:30 this morning in what has been a contentious hearing because of his refusal to answer questions, wolf. >> it keeps going on and on. "the new york times" is reporting that steve bannon is also being subpoenaed by the special counsel robert mueller to appear before a federal grand jury. >> reporter: yeah, that's right. and this is separate from the subpoena that he was hit with today from this congressional committee. this is from bob mueller's team, to testify before a federal grand jury as part of its own investigation into russian meddling, potential obstruction of justice as well.

what we do know is whatever privilege that bannon is citing behind closed doors as a reason he cannot disclose certain communications, it will be much harder for him to do that before bob mueller when he does go before his grand jury to answer questions as part of his investigation, wolf. >> amidst all of this, the former trump campaign chairman paul manafort was back in a federal courtroom today, along with his co-defendant, rick gates. what have we learned about the timing of their trial? >> reporter: yeah, in fact this trial could occur just weeks before the midterm election. as you'll recall, the special counsel wanted to start the manafort and gates trial in mid-may, may 14th to be precise. but the judge in the case today said that was much too quick. she wanted to delay that until later in the year, said that septembe september/october is a better time frame. that could push everything back right in that very contentious time before the midterm elections when republicans will be fighting to maintain their majority in the house and the senate. so we'll see if that's the time

frame that plays out, but not the time frame the special counsel would like, which is much sooner than that. >> as you mentioned, we're standing by to get a readout on this extraordinary hours and hours of testimony steve bannon is providing the house intelligence committee. you see the doors locked there right now, but they'll be emerging fairly soon. adam schiff, the top democrat, we anticipate he will make a statement. perhaps other members will as well. we'll have live coverage of that coming up here in "the situation room." manu, thank you very much. let's talk about all these breaking stories with senator richard blumenthal, a democrat on the judiciary and armed services committees. senator, thanks so much for joining us. >> thank you, wolf. >> i want to get to the russia developments in just a moment but i want to get to your expected vote. will you vote to shut the government down if there's no agreement that will allow the dreamers, the hundreds of thousands of dreamers to remain legally here in the united states? >> my hope, wolf, is that we can still reach common ground.

there is a bipartisan compromise that is very encouraging. the effort to blame each other at this point i think is premature. i voted against the temporary "kick the can down the road" solution last time around because it failed to provide protection for the dreamers against mass deportation, which is against american values, and i will again. >> you're talking about this bipartisan agreement that dig durbin and lindsey graham put together. but the president of the united states has flatly rejected it. >> the president has been a ping-pong ball on this issue. as senator graham said so vividly today, the president that showed up at that thursday meeting when he rejected this compromise seemed to be a different person than the one on tuesday who said i'll accept a bipartisan compromise that includes the essential elements of everything that needs to be done here. and so i think there still is a

possibility -- >> but if they can't get it done by friday a, will you short a short term resolution, a spending bill to avoid a gvernment shutdown? >> i would probably note vote for it. there is no reason we cannot reach a compromise. >> but if you can't, you would still say shut the government down? >> i want to see the terms and the reasons that there would be a shutdown. but i think we need to stand on principle here. the importance of this program to dreamers who are right now going through the anguish and anxiety of their status being undetermined or expiring i think justifies taking a strong stand. >> do you support this compromise worked out by lindsey graham and dick durbin and others? >> i would support it. >> even though there's money for a wall, for border security in

that agreement? >> that's why it's a compromise, wolf. and the amounts of money are way less than the president has advocated over a ten-year period, yet it provides for security. we all agree there has to be border security. there are other parts of it that i think are unnecessary or inappropriate, but that's the nature of a compromise. i hope we can improve it. >> the president says the democrats will be blamed if there's a government shutdown. >> the republicans control both houses of congress and the white house. they have it within their reach and their responsibility to avoid a shutdown. i think it can be done. >> i don't know if you've had a chance, but that hearing today before the senate judiciary committee, and you're a member of the judiciary committee, i assume you sat through most of it. it was pretty extraordinary, the secretary of homeland security, kirstjen nielsen, she couldn't remember the words that the president uttered during that extraordinary meeting the other day, words about haiti and african countries. we all know that one specific word that senator graham -- that

lindsey graham apparently confirmed that the president used. do you think she was telling the truth when she said she couldn't remember? >> whether she believed she was telling the truth, it was inherently unbelievable. for someone to fail to recollect, basic memory, a statement that dramatic by the president was not united states, or the absence of it, defied belief. that's why democrats were frustrated and infuriated. she wanted to move on in response to the question i asked, she said specifically she wanted to avoid that further questioning on it. but words matter. the president doesn't speak for me when he talks like that. and i don't think he talks for most americans. >> let's talk about steve bannon, appearing for hours today behind closed doors before the house intelligence committee, and now according to "the new york times" subpoenaed to appear before a federal grand jury by the special counsel robert mueller. what does it tell you about mueller's mood right now, about

mueller's strategy? >> robert mueller is moving ahead inexorably, meticulously, methodically, with this investigation. this subpoena indicates he will leave no stone unturned. he will not tolerate defiance or noncooperation with his investigation. and the grand jury is considering evidence that will lead to additional indictments and criminal charges. whether bannon is cooperating and simply wants a subpoena as cover so he can tell the president he had no noischoice, genuinely is refusing to answer questions. >> behind closed doors at the house intelligence committee, he's still apparently inside that room right now. members are leaving, saying they're frustrated because he is citing executive privilege, refusing to answer questions. that's why you heard manu raju report a while ago the house intelligence committee has already issued him a separate subpoena to come back. >> and that claim of executive

privilege will have no validity if it's ever tested in the courts, if he drives it to that point. >> why not? >> because he's not a member of the cabinet. >> he was in the white house for a long time, for months. >> and he is no longer there. he basically has no valid claim to defy the judicial process, to say that he is somehow immune, that he has a legal shield from valid corporation at this point. >> can the president cite executive privilege and prevent him from talking? >> the president hasn't done so. and that question could arise if it were a cabinet officer, if it were a present member of the white house staff. but steve bannon is long gone. and i think it would fail in the courts if it were tested. >> in that new book that came out, he talked about that meeting at trump tower with russians, including the president's son, and others as

beingunpatriotic. then he went one step further in that book, and spoke about money laundering being at the heart, not obstruction of justice or collusion but money laundering. what's your reaction to that? >> that revelation is profoundly important. as you know, because i've said it before with you, i believe deutsche bank is an essential element of this investigation. it goes back more than a year when it came to light that deutsche bank was involved in money laundering involving russians. deutsche bank has loaned money to -- tens of millions of dollars to donald trump and his family. so that is probably one of the likely areas of focus. but the other reason that that relationship is very important is that whatever his claims of privilege, whether it's fifth amendment or executive privilege, he may well have waived them in that book. in other words, when you go to the world and start talking about what happened in the white house or facts that may implicate you in a crime, the fifth amendment privilege or the executive privilege or any other

privilege can be waived. >> you know robert mueller and his team, they're following the money, as we like to say. we'll see what emerges. senator, thanks for joining us. >> thank you. once again, we're awaiting the end of steve bannon's appearing before the house intelligence committee. you see the locked doors there. at some point he will emerge, members will emerge as well. we anticipate statements. we'll have live coverage. stand by for that. other breaking news we're following, on immigration and the imminent threat of a government shutdown. representative ted yolo is standing by. with a $500,000 life insurance policy. how much do you think it cost him? $100 a month? $75? $50? actually,duncan got his $500,000 for under $28 a month. less than a dollar a day. his secret? selectquote. in just minutes, a selectquote agent will comparison shop

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we're following breakdown news, the white house declaring tonight it's still working on a deal to try to protect young immigrants known as dreamers after vulgar remarks attributed to the president that turned negotiations into chaos. there is now a threat of government shutdown on the first anniversary of president trump's inauguration. joining us now, republican congressman ted yolo, a member of the house foreign affairs committee. congressman, thanks for joining us. >> thanks, wolf, happy new year. >> happy new year to you as well. you're a member of the freedom caucus. what do you need to see in temporary spending bill to vote yes? >> number one, i hate to have a temporary spending bill, this is the fourth since october. it's crisis management at its

worst. what i like to see, if we're stuck with this, which it looks like we're going to be, is a clean spending bill by itself, don't put daca with that. daca is too important of an issue to tie to something that we must pass. you know, you've got people's lives at stake with daca. and we want a policy that's best, not just best for america, but is best for the people that are involved in that, you know, that are caught up in that program, but also for the citizens of the united states of america. so we shouldn't rush through this on a must-spend emergency spending bill. we've talked to leadership. we're going to have discussions about this. we've got until march. that was an arbitrary deadline. we could pass that. the important thing is, let's get it right so that future generations don't have to struggle with this. >> are you announcing tonight, congressman, that you would vote for a short term continuing resolution if the dreamer issue were not included in that package? >> i can't announce that because

i have the seen the language. once i see the language, i can tell you. you know, i've heard different variations of what may be in there. but until i see the language and have time to read that, and he go through it in our office, it's hard to comment on that. i would like to, short of, you know, the ideal thing would be to have a spending bill like we're supposed to. keep in mind, the house passed all 12 appropriations bills. the senate failed to act. we're going to have to do something to keep the house -- the government open. nobody wants the government shut down. but saying that, if they load this up with a bunch of things that shouldn't be in there, that don't pertain to spending, they're going to have a fight on their hands. and we'll see what comes out. we'll have a conference tonight, then we'll have a meeting after that to see which way we're going to go. >> you're talking about the house freedom caucus. >> right. >> a lot of the members of the freedom caucus say they won't vote for another short term spending bill. will republicans, and president trump for that matter, take the

blame if the government does shut down friday night? the republicans control the house, the senate, and the white house. >> no, i don't think so. it's congress in general. again, we passed 12 appropriations bills. the senate didn't do anything. one senator in the senate can filibuster and shut the whole process down. you know, i've been here for five years, and i've seen the confederate flag issue shut down the appropriations process. so we had to go into an omnibus or short term spending. we saw some other issues that came up that shut down the process. it's a broken process that we need to fix. and let's hope that the beginning of this year, right now, we come out with a budget, we do our appropriations like we're supposed to, so that we can go on and fix the other issues in this country. national security, jobs, infrastructure. those things. and let's move for the american taxpayers and build on tax reform that we did in 2017. it's so important to move the country forward instead of getting stuck on this stuff. >> there's been a debate about the exact wording.

but it's clear that the president's message in that controversial immigration meeting last thursday was that he wants more norwegian immigrants and european immigrants to come to the united states, fewer immigrants from haiti and african countries. is that racist? >> you know, i wasn't in that meeting. i've heard that in the news. i haven't heard the president's words per se. and i'm hearing, you know, people said he said that, other people said he didn't say that. so not being in that room, if there's transcripts, that would be the thing to look at. >> if he said it, if he said it, if he said those words, and you know the controversial words we're talking about, if he did say it, do you believe that would be racist? >> no, because i don't know what the intent behind it was. is he talking about having skilled people to come in and benefit our economy versus unskilled laborers that, you know, they don't create the jobs. we've got a lot of immigrants in our district. we've got a lot of ag workers.

we've also got entrepreneurs that come in and create jobs in america. if you go back to the policies the president has passed, theodore roosevelt, come into this country if you have something to provide it. it's not something that's changed. it's just we've got a mess on our hands that we have to bring a resolution to this. and that's why i don't want it tied up to the spending bill. if you put it in a short term cr, it will be jammed in there and you'll get garbage. it's something future congresses and the american people will have to deal with and it still leaves that group of people hanging out there. they didn't have a choice, they came over here, their parents brought them here illegally. let's fix this and do at it right way so we're not back here for another cr trying to ram it through. >> what do you mean by skilled immigrants, skilled workers? >> you know, if you look historically, the ones that have engineering degrees or doctors degrees, architects, things like that that we've done historically in the past, i'm

talking from the early 1900s, the theodore roosevelt age. when we brought in workers that had specific skill sets. and i know we have different visa programs to do that. but it's a broken system right now. when you have a lottery system or chain migration, those are things that we need to reform. that's what, you know, the american taxpayers where i come from, the constituents there, they want to protect the american citizens. after all, those are the ones -- >> congressman, i don't know about your ancestors when they came over to the united states, but i suspect they didn't have a whole lot of skills, they were probably very poor. but look what they achieved while here in the united states. >> sure. >> my parents came over the same way, they didn't have many skills, but they achieved a great deal because this country gives these people great opportunities. >> opportunities. >> you can't ban these people from coming to the united states, right? >> you're absolutely right. and you hit on something that's the most important thing. it's opportunity. talk to people, why they came here. it's for opportunity. it's for security for their

family. it's for a better life for their family. and so that's the thing that we have to protect in america. and those ideals are neither republican or democrat. those are american ideologies that i would hope republicans and democrats would come together to fix that problem so that people can come in here in a legal process that's not -- >> but congressman, how are they going to have that opportunity, excuse me for interrupting, if you're own going to allow the skilled architects or software engineers or people with those kinds of educational backgrounds to emigrate to the united states? >> well, we've got a whole guest worker program for our agriculture and labor. there's ways to bring in people. but it needs to be an organized way that people can come into this country. >> tell us about those ways. how do you do that, how do you make sure there are workers who come in, work really hard, and have an opportunity, their kids do well in school, and they eventually become like you, a

member of the united states house of representatives? how do you do that, guarantee they will have a place in this country, not just highly educated, wealthy, english-speaking immigrants? >> what i was referring to is, i just don't want open borders where everyone can come in or a system called daca that was unconstitutional that the previous president did. we want it to where people can come in, whether they're the skilled worker that's the entrepreneur. i've got a family right now in my district that's been here for 15 years. they've created jobs. they've got over 20 people employed. but they've got to go back to their host country every two years, and they've got to stay out for two weeks. they've been doing this for probably 15 years. we've got a program, and we've worked with chairman goodlatte on judiciary, the unskilled workers can come in, stay for a period of five years, go back to their host country and come back. this is something that should be resolved. i see it as an easy fix.

but when you start tying this stuff into a must-spend bill, a short term resolution, you're not going to get a good product out of that. the american people deserve a good product along with the people that are stuck in that system. >> one final question, congressman, before i let you go. the 700,000 or so dreamers that we're all talking about, those dreamers who were brought to this country as kids illegally by their parents, you want them to stay in the united states, you want them to have not only legal status but also eventually a pathway to citizenship, is that right? >> wolf, i can't answer that in a short period of time. we have a program where people can work through the system. it's not a giveaway. just because you came in here through no choice of your own, it's not an all thing. there's going to be some requirements in there. and that's a longer conversation. but the sentiment up here, and my feeling, being a parent, is people who have been here, there has to be a way we can work them into society where they're not

living in the shadows and they can contribute, not that they're not contributing, but they can contribute down the road so that they can experience what we experience in this country, the american dream that comes from the opportunity that you talked about. that's the most important thing that people want to remember, what america stands for. >> but you're willing to give them an opportunity to have legal status? because some of your colleagues say that would be amnesty and they don't even want those 700,000 dreamers to stay in the united states. but you say let them stay, is that right? >> well, and you brought up a great point, because as soon as you start talking about it, one size says you're giving amnesty to everybody, the other side says you're trying to deport everybody. that's why it's never been fixed. that's why i credit president trump for having that meeting and starting the conversation. if you don't have the conversation, you can't revolso this problem. we've got a situation were 7, 800,000 people came in, through

no choice of their own, they were brought in illegally but they've been here ten, 15, 20 years, what do you do with them? i talk to a lot of people who say, deport them all. i said, give me a solution, they play baseball with your kids, they go on boy scouts or girl scouts outings with your kids, they're part of the community. we have to figure out a way to get here in this country where they can be here legally but at the same time you've got to have border executing, you have to have enforcement of laws on the books and then you have to have an immigration system so we don't repeat this in 15 or 20 years. >> congressman ted yolo, we have to leave it on that note. coming up next, key senators slammed the president's advisers and warned that immigration talks are, well, a mess. and with former top trump

adviser steve bannon reportedly subpoenaed by the special counsel, is the president's inner circle feeling the heat? your insurance company

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president trump's former top strategist has been answering questions before members of the house intelligence committee for hours now, all behind closed doors. but a lot of those questions he's refusing to answer.

according to sources inside who say he's citing executive privilege. we anticipate he will emerge fairly soon, since 9:30 this morning he's been there. and there will be statements from members emerging as well. we'll have coverage of that, stand by. but i want to get some reaction, phil mudd is with us. phil, he was also subpoenaed, according to "the new york times" by special counsel robert mueller, to testify before a federal grand jury. we're talking about steve bannon. what does that say to you? >> a very simple story here. robert mueller doesn't sit on his hands. but he's also methodical. you've seen the circle of the inquiry go tight and her and ti into the president's circle. now you have his strategic adviser. the reason they're doing this, wolf, when they're looking financial and phone records, you want to have those interviews done with the lower level folks before you walk in with someone

like steve bannon, because you not only want to hear about what facts he cites in terms of president trump, you want to hear whether he confirms or contradicts things they've heard earlier. if he contradicts them, somebody has lied, and mueller has shown us he's willing to charge people with lying, people who pled guilty for lying to the fbi. really interesting, he's getting to the center of the story, wolf. >> dana, members of the house intelligence committee were very frustrated, according to manu raju, our congressional correspondent, that steve bannon wasn't answering a lot of questions, citing executive privilege. the committee has issued a second subpoena for him to come back and force his testimony. >> right, which is going to force a question of whether or not invoking executive privilege is appropriate for someone like steve bannon, who was not

senate-confirmed. he was a member of the president's staff. and certainly there is a history of this going both ways. just on a very different topic, i remember condoleeza rice, back during the bush administration, when she was the national security adviser, there was a huge to'ing and fro'ing whether she should come testify in public about various things going on in the bush administration. finally they agreed that the answer is yes. but that kind of tug-of-war about executive versus legislative branch has gone the other way in the past. we'll see how that goes. this is going to open up that question, not just for steve bannon, but for others who are going to argue, you know what, i gave the president of the united states my advice, i had conversations with him as his aide and it's not appropriate for me to tell you, members of congress. >> you know, david, apparently the members of the house intelligence committee and robert mueller, the special

counsel, they think he has answers to issues that he himself raised in this new controversial book by michael wolff, not just collusion, alleged collusion or obstruction of justice, but also money laundering. >> right. i think the rubber really meets the road in the case of the special prosecutor's investigation. if mueller has subpoenaed him, if he brings him in to testify in front of a grand jury without an attorney and gets those answers on the record like phil is talking about, then he's going to be able to match that testimony up with jared kushner, other people that mueller has interviewed, with lower level staff people. steve bannon will be on the hook for those answers and other people will be on the hook for any discrepancies. >> rebecca, questioning is continuing behind closed doors at the house intelligence committee, since 9:30 this morning. they're asking and asking, and apparently not getting a whole lot of answers. >> first, wolf, this is questioning involving members of

both political parties. you can expect some probably very aggressive questioning coming from democrats, a lot of questions they'll want answers to. and of course republicans sort of have their own agenda, their own direction. they might want to be taking this interview, so these dueling priorities which tends to extend the interview process a little bit. steve bannon is not only someone who served as a top white house adviser to the president, but he was there during that crucial final stretch of the campaign. he's been in touch with president trump as sort of an informal adviser as far back as 2011, is when he first met him through david bossie, former chairman of citizens united. he has a lot of insight to offer. i can personally this of a ton of questions i would like to ask him in that setting, so i can imagine the lawmakers will have things to ask him as well. >> phil, you've worked at the cia and fbi. it's a moment when mueller says, you know what, you're going to

appear before a federal grand jury, he's subpoenaed to do it, but sometimes that's a ploy to get him to cooperate, right? >> i think so. we're talking about executive privilege and whether he'll cite executive privilege. there are two categories of things here. dana was talking about this a moment ago. i served at the white house as well. if congress wants to ask about private conversation. that is different from what we are having here. we are not having a conversation about daca. we are having a conversation about whether steve bannon saw illegal activity that violates federal law. so i think executive privilege gets blurry when you talk about this. did you witness financial conversations and sanctions. did you see illegal activity. that's what the key question is. >> i think you are right, phil.

the question is whether it's about the campaign, at least kwh it comes to the congressional committees, particularly the house, their focus is still collusion. and whether or not that happened during the campaign. and seems as though what steve bannon is saying i don't want to talk about things that happened while i was in the white house after the president was elected. which is a whole different sort of kettle of fish. >> but spoke about a lot of those things in the interview with michael wolff the new book. >> he did. >> so the argument is you already spoken about it how do you site executive privilege right now. >> i think he can do it as long as he can get away with it. i think all of the things talked about in that book, if i'm special counsel mueller what i want to get to is does he have different version of events. this is the campaign not during the white house tenure. does he have a different version of events about what happened in that meeting in trump tower with that lawyer natalia veselnitskaya then what paul

manafort and jared kushner said and if he thinks anything to do with money laundering or went up to president trump. >> we are still waiting to see if any of the members emerge and make statements. the doors are still closed over there. steve bannon still behind closed doors. appearing before this house intelligence committee. we'll have live coverage once they emerge. stand by for that. also coming up kim jong-un regime accuses president trump of lunacy as the u.s. secretary of state tries to ramp up diplomacy with secretary of state at a summit.

new tonight as north korea denounces president trump as a lunatic, the united states is moving more fire power to the region deploying six nuclear cap able b 52 bombers to guam. same time u.s. and canada are hosting summit on the north korea nuclear threat. let's get to correspondent traveling with secretary of state rex tillerson joining us from vancouver. secretary tillerson says the international community must keep the pressure on north korea. what else are you learning? >> reporter: wolf, this wasn't a time for the tough rhetoric, talking about the military option or doing nick to escalate tensions. in fact, this was a time for these country toss acknowledge the talks going on between north and south korea even just about the olympics, could be a

positive. but that doesn't mean that the maximum pressure campaign against north korea should let up at all. in fact, it should be intensified. and there needs to be new consequences for any new aggressions by north korea. one of the biggest goals -- >> all right. unfortunately looks like we lost our connection with michelle in vancouver covering this summit. foreign ministers at least 20 nations led by the united states and canada meeting to discuss the north korea nuclear threat. i think we established our connection with michelle. pick up the thought you were making. >> reporter: okay. wolf, right i was saying one of the biggest goals was for the 20 countries here, and even though that aren't, russia and china, send unified message that they still agree that a nuclearized north korea moving forward is unacceptable. and secretary of state tillerson made a different kind of

argument. he used big visual behind him of all the air traffic over the korean peninsula on any given day representing more than 150,000 plane passengers. to hammer the point home, these are all the lives that could be at risk in the immediate sense every time north korea fires off a missile. here's part of what he said. >> this progress is encouraging but we cannot be come plplacent. kim jong-un continues to threaten security through ballistic missile and nuclear test. >> another goal here, wolf, was to assess how this pressure campaign is going. how can sanctions be better enforced, put a little more pressure on china and russia, how do you stop north korea to smuggle banned items in and out. but some of the blunt es comments today came from the japanese foreign minister who said he thinks that north korea by holding these talks with

south korea is just buying time to continue its nuclear program. he warned the world not to be naive or blinded by what he called north korea's charm offensive. wolf. >> michelle, thanks very much. reporting from vancouver. that it for me. thanks for watching. erin burnett out front starts right now. out front next, your amnesia is complicit after she says she doesn't recall the president's s hole comments. plus steve bannon grilled on capitol hill and tonight still going ton. what is he telling investigators. we are going on ten hours here, people. and the white house doctor goes on and on answering an hour of questions about president trump's health. is there anything left to learn? let's go out front.