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CNN "The Situation Room" - Transcript - IRS Targeting Controversy and Benghazi Hearings


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BLITZER: All right.

Hold on for a moment, because as we await the president, he's running a little bit late right now, Darrell Issa, the Congressman from California, is joining us live from Capitol Hill right now. He's the chairman of the House Oversight and Government Reform committee.

What do you want to hear from the president on this IRS investigation, Congressman?

REP. DARRELL ISSA (R), CALIFORNIA: Well, we expect to hear from the president that he's going to aggressively hold people responsible. And that's good. But the I.G.'s report made it very clear that the institution does not have the controls for the I.G. even to guarantee that it is not much broader than we now know. In other words, he doesn't know there weren't other scandals like this within the IRS because the internal controls were not good enough. I think that's the beginning of where Congress is going to want more action.

BLITZER: Do you believe crimes were committed?

ISSA: Well, certainly I think the American people believe in that old axiom that the power to tax is the power to destroy. And people had an intent to destroy, or to affect the outcome of an election by holding back groups that might have been advocates for smaller government, for constitutional behavior and the like. So, it certainly had a disruptive process. In this case, as you've been saying, it's conservatives. But in the past, it's also been other groups. African-American groups, civil rights groups, a number of others.

So, I think what we have to do is fix the IRS once and for all. I look forward to the president getting ahead of part of this story. But let's remember, the actions the IRS, in this case, conspicuously benefited the president.

BLITZER: Because in the inspector general's report, among other things, they concluded this: "All of these officials stated that the criteria were not influenced by any individual or organization outside the IRS." Do you buy that?

ISSA: Well, I certainly think it's possible that the IRS, individuals, for political reasons, made decisions to distort the process. But I also know that a huge number of members of Congress on both the House and Senate side, including the finance committee chairman, wrote letters saying, investigate the Tea Party. So you kind of have the worst of both worlds. You have members of Congress saying investigate the Tea Parties, you have individuals saying they did it, but those letters made no difference. The president benefiting made no difference.

Again, Wolf, the important thing from the I.G., the takeaway that our committee, Oversight committee will be doing in addition to Ways and Means, is making sure the controls are put in, sort of like the Enron scandal and the WorldCom scandal. If public companies can't be trusted when they put something out, it affects the market. If the government can't be trusted when they take your taxes, we need to make sure it will be.

BLITZER: Congressman, the president is about to speak. If you can stand by and listen to the president with us, we'll continue this conversation on the other side. He's going to speak in a few seconds.


BLITZER: Dana, stand by.

Let's get some quick reaction from Congressman Darrell Issa. He's joining us now live from Capitol Hill.

He listened to what the president had to say over at the White House. He's the chairman of the House Oversight and Government Reform Committee.

Did he satisfy you, did he satisfy your demands, Congressman?

ISSA: Well, Wolf, the president set exactly the right tone. I think that immediate relieving of an acting commissioner who had -- made false statements and misled Congress is an extremely good first step.

One thing I can assure you that he asked for that he's going to get, both the Ways and Means committee and my committee with my ranking committee member, Elijah Cummings, have vowed to do bipartisan work. We've started off that way, we're going to stay that way. The IRS is definitely an issue in which what happens wrong today could happen wrong tomorrow to a different group of Americans.

So, I think the president will find very willing partners on Capitol Hill. I think in this case, we very much take him at his word that he wants to be open and transparent in fixing the system and putting new controls in place.

BLITZER: Do you think more people need to be fired over there at the IRS?

ISSA: Well, I think the I.G. made it clear that there were additional people beyond obviously the obvious one, somebody who made false statements. We're going to -- the Ways and Means and our committee are going to be getting interviews and public testimony to get further on that.

But as you said, many of them are civil service. They can be hard to fire, although you can relieve them from doing things with this level of trust. But again, the I.G. report made it clear that the system did not have the safeguards the American people expressed -- expect, and that will be part of what the administration and Congress as a legislative body will have to do, is create that comfort level that this will never happen again.

BLITZER: So you're accepting the president's challenge to work in a bipartisan way, to make sure that this never happens again. So he says he's going to do whatever is necessary. Are you ready to do the same thing?

ISSA: Oh, absolutely. And I think that's where you saw not one, but two committees call on a bipartisan basis for this. Elijah Cummings and I will disagree on many things, as you can imagine. But this is one where my ranking member came to me almost immediately. We discussed how to go forward. Remember, it was our committee that set the I.G. in motion in June of last year. And he's equally interested in us getting it right.

BLITZER: Let me quickly get your reaction to the other news of the day. The White House releasing 100 pages of documents on the e- mails that resulted in those talking points on the Benghazi attack, the attack that killed four Americans, including the U.S. ambassador to Libya, explaining how Susan Rice eventually wound up saying in effect what she did say in those five Sunday talk shows a few days after the September 11 attack. I assume you welcome the release of these documents?

ISSA: We do welcome them. Although releasing them to the press before releasing them to the Congress, would seem to be pretty inappropriate. And of course, there are many other documents that they're still not releasing. The idea that they selectively say they have deliberate process protection as they did in Fast and Furious, and they still are in these documents, is an area we need to come to grips with the administration. When the American people are lied to, realizing that their work product should be open for criticism and review.

BLITZER: You know, as you know, these e-mails show it was pretty complex, the back-and-forth between the CIA, the White House, the State Department, the Pentagon.

Let me read a couple of quotes, this from page 59, a draft note to the CIA director:"We've tried to work the draft talking points but have run into major problems. The White House cleared quickly, but State has major concerns. The Bureau cleared with a few comments, but asked that Justice be brought in. It is evidence that will not happen tonight. And Ben Rhodes," who is the official at the NSC, the National Security Council, "has asked that this issue be reviewed tomorrow morning."

Then on page 94, a little bit later, an e-mail to the U.S. ambassador to the United Nations, Susan Rice. "The first draft apparently seemed unsuitable because they seemed to encourage the reader to infer incorrectly that the CIA had warned about a specific attack on our embassy. Morell" -- Mike Morell, the deputy CIA director -- "noted that these points were not good, and he had taken a heavy editing hand to them."

So, when you hear these, when you see these e-mails, when you see what was going on, does it satisfy you that all of this back-and-forth was sort of routine, done in good faith, or was there something sinister there?

ISSA: We're not accusing anyone of anything sinister. We certainly want to digest these pages, but recognize that these are selected pages. We need to have full access to the deliberative process of the e-mails. And I think that's one of the areas we clearly want to have. But remember, Wolf, this is a situation in which the two men on the ground, the now deceased ambassador, Ambassador Stevens, who said to his deputy, Gregg, "We're under attack." And Greg Hicks who testified he knew this was a terrorist attack from the get-go. Certainly the president of Libya said so on, you know, national television. At the same time, Susan Rice was delivering false information.

When you look at this train, you still have to ask the question, is how did they go from the correct information to the incorrect information? And isn't 100 pages or more a pushback on the CIA effectively telling the CIA, "You've got to change your story"?

BLITZER: One final question, Congressman, before I let you go. The exchange you had with Eric Holder today, the attorney general of the United States, on a totally unrelated matter, the secretary -- the labor secretary nominee. It was an angry exchange. And he was furious at you. I'm going to play the exchange for our viewers, because I want you to respond to what he accused you of. It was pretty biting.


ISSA: Mr. Cummings, my ranking member, joined in a letter requesting that we have the full contents pursuant to our subpoena of all 1,200. Will you make them available to the committee based on our bipartisan request?

ERIC HOLDER, ATTORNEY GENERAL OF THE UNITED STATES: I'll certainly look at the request. It's not something that I've personally been involved in. But I'll look at the request and try to be as responsive as we can. I'm sure there must have been a good reason why only the to and from parts were...

ISSA: Yes. You didn't want us to see the details. Mr. Attorney General...

HOLDER: No, no.

ISSA: See, knowing the to and from -- knowing the to and from...

HOLDER: I'm not going to stop talking now. You characterized something as something...

ISSA: Mr. Chairman, would you inform the witness as to the rules of this committee?


HOLDER: ... not appropriate and is too consistent with the way in which you conduct yourself as a member of Congress. It's unacceptable and it's shameful.


BLITZER: Those are pretty blunt words, "unacceptable and shameful" the way you conduct yourself, Congressman, as a member of Congress. I want you to respond to what he said.

ISSA: You know, I have to keep doing my job, even if the attorney general objects.

Thomas Perez told us that there were no documents offline. In other words, no private e-mails. It went from zero to 1, to 2, to 34, now 35 responsive e-mails in which he e-mailed privately, including one that was a private e-mail to another private e-mail at HUD. These are violations of the Federal Records Act.

But more importantly, there were 1,200 e-mails that we simply want to look at. This is my ranking member and myself. We don't want copies of them. We want to be able to review them to make sure we're satisfied that there are no additional documents.

And in the case of the documents we're talking about, they're redacting, these are 35 e-mails, in violation of the law, that Thomas Perez had communications offline. We know that one of them is to the White House. One of them is to a HUD individual related to a quid pro quo that he conducted secretly in St. Paul, Minnesota.

Those -- this investigation is into the wrongdoing as we view it, at least not illegal, but wrongdoing by the proposed secretary, while he was supposed to be heading up Justice in the civil rights division, and areas in which he gave false testimony as to what he did or didn't do. It's a cover-up. We played a tape of his actually instructing somebody in the attorney general's office in Minnesota not to speak about things.

So these kinds of facts, and we've produced a fairly lengthy report that's on our Web site, as to Thomas Perez and his actions, these were very appropriate questions. I know the attorney general would have liked to have answered for five minutes, and my time would have been done. All I was trying to do is ask him questions to hope that he would release information that a very, very strong Democrat and I have both asked for.

BLITZER: Darrell Issa is the chairman of the House Oversight and Government Reform Committee. Mr. Chairman, thanks very much for coming in.

ISSA: Thank you.

BLITZER: Thanks for sticking around and listening to the president and getting your immediate reaction. We appreciate it very much.

ISSA: Of course.


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