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Trump Feuds with Rep. Martin, Meets MLK's Son; Russia Praises Trump for Calling NATO 'Obsolete'; Rice: Trump Would Be 'Foolish' to Rip Up Iran Deal, Move Tel Aviv Embassy; Ivanka Trump Preparing for Unique Role in White House; Trump's Son-in-Law to Tackle Middle East Peace Negotiations. Aired 5-6p ET

Aired January 16, 2017 - 17:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

WOLF BLITZER, CNN ANCHOR: Happening now, airing of grievances. In a storm of tweets and multiple interviews, Donald Trump's feuds with civil rights icon John Lewis, as well as the head of the CIA that even promises insurance for everyone once Obamacare is repealed. Just days before the inauguration, is Trump taking on too many fights?

Trashing the alliance. Trump calls the NATO alliance obsolete, indicates United States' one-China policy is negotiable, and says he will start out trusting Germany's Angela Merkel and Vladimir Putin equally. Is Trump going to upset the international order and America's role in it? I'll get reaction live from President Obama's national security advisor Susan Rice.

Ivanka's new role. Her move to Washington is almost as highly anticipated as her father's. Tonight her two brothers talk with CNN about what she may accomplish. Will the first daughter also be the president-elect's closest adviser?

And Peace broker? Trump heaps praise on his son-in-law, real-estate broker Jared Kushner, saying he can succeed in negotiating a Middle East peace deal. Why does Trump believe Kushner can bring the Israelis and the Palestinians together when so many others have failed?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

With just four days to go until he becomes president, Donald Trump is giving a thumbs-up but not responding to questions about the multiple controversies he has provoked in interviews and Twitter attacks over the past few days. After meeting with the president-elect today, Martin Luther King's son defended Congressman John Lewis, who Trump attacked over the weekend as, quote, "All talk, talk, talk, and no action," but also said he had a productive meeting with Trump about voting rights.

At the same time he's taking on domestic policy, Trump is also attacking some of America's key allies, calling the NATO security alliance obsolete; criticizing what he called a catastrophic mistake by German Chancellor Angela Merkel; and attacking the head of the CIA. While the president-elect is floating the idea of reducing new sanctions on Russia for its role in hacking the election, in return for help from Russia on other international issues.

Also tonight, Trump's two sons are giving CNN new insights into their sister Ivanka. She's moving to Washington, D.C., and is expected to be a major player at the White House, as well as in the city's social circles. Susan Rice, President Obama's national security adviser, is standing by to take our questions about the state of the world and the incoming president's latest controversies.

And our correspondents, analysts and guests, they will have full coverage of the day's top stories. Let's begin with our senior Washington correspondent, Jeff Zeleny.

Jeff, Trump is facing lots of criticism for what he had to say about a civil rights icon, John Lewis.

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: He is, indeed, Wolf. That backlash is coming on the very day the country is celebrating and remembering Dr. Martin Luther King Jr.

But John Lewis may have started this extraordinary exchange by questioning Donald Trump's legitimacy. But Democrats believe that's exactly what Donald Trump has done to President Obama for years.

(BEGIN VIDEOTAPE)

REP. JOHN LEWIS (D), GEORGIA: Never give up. Never give in. Stand up. Speak up.

ZELENY (voice-over): John Lewis remembering the legacy today of Dr. Martin Luther King Jr.

LEWIS: When you see something that is not right, not fair, not just, you have a moral obligation to do something, to say something, and not be quiet.

ZELENY: One of the last living giants of the civil rights movement, Lewis is not being quiet about Donald Trump and questioned his legitimacy on NBC's "Meet the Press."

LEWIS: I don't see this president-elect as a legitimate president. I think the Russians participated in helping this man get elected. And they helped destroy the candidacy of Hillary Clinton.

ZELENY: Those comments sparked a fire storm from Trump, who slammed Lewis on Twitter: "Congressman John Lewis should spend more time on fixing and helping his district, which is in horrible shape and falling apart, not to mention crime infested. Rather than falsely complaining about the election results. All talk, talk, talk, no action or results. Sad."

Trump's comments about Lewis were widely rejected, by Democrats and Republicans, including Senator Ben Sasse of Nebraska, who tweeted, "John Lewis and his talk have changed the world."

But Vice President-elect Mike Pence said questions of Trump's legitimacy are out of bounds. [17:05:05] GOV. MIKE PENCE (R-IN), VICE-PRESIDENT-ELECT OF THE UNITED

STATES: And to say that Donald Trump will not be a legitimate president was deeply disappointing to me.

ZELENY: At a Martin Luther King celebration today in Miami, the congressman, who still bears a Scar from the bloody Sunday March on Selma did not respond directly to Trump.

LEWIS: We must never, ever hate. The way of love is the better way. The way of peace is a better way.

ZELENY: The controversy unfolding as the country observed Dr. Martin Luther Jr. Day, underscored Trump's challenge on race in America, just four days before taking office. At Trump Tower, the president-elect meeting with Martin Luther King III. King said he disagreed with Trump's characterization of Lewis but tried to lower the temperature of the dispute, as he said his father would have done.

MARTIN LUTHER KING III, SON OF MARTIN LUTHER KING JR.: Absolutely I would say John Lewis has demonstrated that he's action. As I said, things get said on both sides in the heat of emotion.

ZELENY: After questioning the legitimacy of President Obama for years, Trump drew criticism on the campaign trail for how he addressed African-Americans.

TRUMP: You're living in poverty, your schools are no good. You have no jobs. Fifty-eight percent of your youth is unemployed. What the hell do you have to lose?

ZELENY: Today Donald Trump canceled a visit to Washington but invited King's son to Trump Tower for the meeting. King said Trump pledged to be a president for all Americans.

KING: I believe that that's his intent, but I think also we have to consistently engage with pressure, public pressure. It doesn't happen automatically.

(END VIDEOTAPE)

ZELENY: Now, in just four days Trump will be sworn in. John Lewis says he will not be there. And a list of at least 25 Democratic members of Congress say they'll boycott, as well. Several say Trump crossed a line by attacking John Lewis and is district that covers most of Atlanta.

And Wolf, one more point: our CNN fact check of Trump also called his criticism of Atlanta embellished and not true.

BLITZER: Jeff Zeleny reporting for us. Thank you very much.

Trump's weekend feud with Congressman Lewis was only just the beginning. There's also fallout tonight over the president-elect's weekend fights with the CIA, the European Union, NATO, Germany, and China.

In interviews over the weekend Trump once again called NATO obsolete, winning praise from Russia and drawing criticism in Europe.

Let's get some more reaction from our Pentagon correspondent, Barbara Starr. Barbara, what are you hearing?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, tonight U.S. troops are standing in eastern Poland, a hedge against Russia, but the question is, is Donald Trump standing with them?

(BEGIN VIDEOTAPE)

STARR (voice-over): This is the new front line in battlefield training, nearly 4,000 American troops, tanks, artillery and armored vehicles deployed to Poland. It's all part of a massive U.S. and NATO effort to send a pointed message to Vladimir Putin: Hands off Eastern Europe.

COL. CHRISTOPHER NOME, U.S. ARMY: Our soldiers will be show-casing their lethal abilities.

STARR: But the current CIA director openly questioning if President- elect Donald Trump even understands Russia.

JOHN BRENNAN, CIA DIRECTOR: I don't think he has a full appreciation of Russian capabilities, Russia's intentions and actions that they are undertaking in many parts of the world.

SEAN SPICER, INCOMING WHITE HOUSE PRESS SECRETARY: The idea that you can question the president-elect's knowledge and understanding of Russia is pretty remarkable.

STARR: Trump's incoming Defense Secretary James Mattis has no doubts about what Russia is up to with NATO.

GEN. JAMES MATTIS (RET.), DEFENSE SECRETARY NOMINEE: The most important thing is that we recognize the reality of what we deal with with Mr. Putin, and we recognize that he is trying to break the North Atlantic alliance.

STARR: The president-elect still doesn't seem on the same page when it comes to NATO.

TRUMP: No. 1, it is obsolete, because it was, you know, designed many, many years ago. The countries weren't paying what they're supposed to pay.

STARR: The alliance is worried. The German foreign minister says Trump's latest remarks have caused bewilderment and agitation inside NATO. U.S. and NATO troops are bolstering Europe's eastern flank with thousands of troops scheduled for joint exercises and training in the coming months.

The Kremlin spokesman calling it all a threat to Russia. Russia has responded, putting S-400 missiles in Crimea and adding to missiles in Kaliningrad, an enclave between Poland and the Baltics, missiles that can strike Europe.

All of this leaving the incoming defense secretary caught between the new president and what he sees as a top U.S. military priority.

MATTIS: I would see us maintaining the strongest possible relationship with NATO.

(END VIDEOTAPE)

STARR: Now, Trump has said that NATO is important to him, but he hasn't said how important and under what circumstances, and that lack of precision worries military commanders who are always concerned that Russia may misinterpret and may miscalculate -- Wolf.

[17:10:05] BLITZER: Barbara Starr at the Pentagon. Thanks very much.

Joining us now, President Obama's national security advisor, Susan Rice. Ambassador Rice, thanks very much for joining us.

SUSAN RICE, PRESIDENT OBAMA'S NATIONAL SECURITY ADVISOR: Good to be with you, Wolf.

BLITZER: President-elect Trump once again called NATO in this weekend interview with a German publication, the British publication, obsolete. Do you think he understands the importance of this alliance?

RICE: Well, Wolf, I think all Americans need to recall the critical importance of NATO to our security. NATO has been the most durable and important alliance in the history of modern international relations.

NATO forces have only invoked Article 5, the mutual defense understanding, among NATO partners, once in its history, and that was after 9/11, when NATO came to our side and aligned with us against the al Qaeda threat.

NATO has put thousands of troops into Afghanistan and maintained several thousand side by side with American forces to continue that counter-terrorism mission.

NATO is playing a critical role in our standing firm against Russian aggression in the east and in helping to manage and contain the migrant flow as it affects NATO countries from the south as well as from the Middle East.

So NATO is very relevant. It's as relevant or more relevant today than it's been even post-Cold War. And it's very important that our leadership and the American people understand the value and the importance of that alliance to our security.

BLITZER: So do you think President-elect Trump doesn't care or doesn't understand the importance of this alliance?

RICE: Wolf, I can't speak for President-elect Trump. I can speak for President Obama, who has prioritized the NATO alliance and our partnership and our bonds with our European allies as being a primary component of our security and prosperity. I think the American people understand how important NATO is, and I

would hope and expect that any president of the United States would come to that understanding, as well.

BLITZER: In the weekend interview with "Bild," the German publication, "Times of London," he was asked who he trusts more, the German chancellor, Angela Merkel, or the Russian president, Vladimir Putin. Trump said he will start off trusting both. Is that a mistake?

RICE: It's very hard to understand how one could equate Angela Merkel, the chancellor of Germany, one of our very closest allies in the world, with Vladimir Putin, who is the leader of a highly adversarial country, who has involved himself nefariously in our elections, that has invaded a sovereign nation of Ukraine and annexed Crimea, and that is involved in the worst kinds of atrocities in Syria. So I truly don't understand that equation.

BLITZER: He did also suggest, Ambassador Rice, that he could ease the sanctions that President Obama recently launched against Russia. He said he could take those steps eventually. Would that be appropriate? Is that appropriate for him to say that, especially before he takes office?

RICE: Well, Wolf, the American tradition has long been that there is one president of the United States at a time. Come Friday at noon, that will be Donald Trump. But until then, it's Barack Obama. And Barack Obama and a bipartisan wide cross-section of policy makers have concluded that Russia's behavior, both with respect to Ukraine, Syria and now most recently their interference in our electoral process, merits sanctions. And we will continue to maintain those sanctions.

Obviously, a new president has the means and the wherewithal to reverse that. In doing so, he'd be taking a major departure from our European partners, who have joined with us in these sanctions as they relate to Ukraine and Crimea.

BLITZER: I assume, Ambassador Rice, you've explained that to his incoming national security team. You and your team have had a lot of meetings with them. Is that right?

RICE: We've had several meetings, Wolf. And I expect we'll have more. And we've covered a wide range of national security issues and challenges, including this one.

BLITZER: President-elect Trump also called the German chancellor, Angela Merkel's, refugee policy -- and millions of refugees from the Middle East, Syria and other countries have been coming into Germany over the past couple years -- he said it was catastrophic, her policy. Secretary of State Kerry told CNN today it's inappropriate to wade into other countries' politics, policies when it comes to an issue like refugees. Do you agree with the secretary of state?

RICE: I do.

[17:15:04] BLITZER: And do you understand, though, why he thinks Germany's allowing these millions of refugees to come in from Syria and elsewhere was catastrophic, given that they really aren't vetted all that well?

RICE: I would not align myself with that comment, no. I think that, by contrast, while Germany and other European countries are doing their utmost to vet and screen incoming refugees, as well they should, that Chancellor Merkel has actually demonstrated extraordinary compassion and bravery in leading the way in dealing with those who have suffered the most in Syria and elsewhere.

So one can have a philosophical difference about the merits of a refugee policy, but I do agree with Secretary Kerry that it is not wise to criticize the domestic policies of an allied country.

BLITZER: President-elect Trump, in that weekend interview said he wasn't happy, once again, with the Iran nuclear deal. He called it the worst deal, the dumbest deal, he's ever seen. He says he wants to renegotiate that deal. What would happen -- and you were very much involved in putting that deal together. What would happen, Ambassador Rice, if he were to rip it up?

RICE: Wolf, if he were to rip it up, he wouldn't be just abrogating a deal between the United States and Iran. He'd be abrogating a deal between the United States, Britain, France, Germany, the European Union, Russia and China, as well as Iran.

And that deal was reached painstakingly. It has been a manifest success in blocking all of Iran's pathways to a nuclear weapon. It was accomplished through diplomacy, without the use of force. And the alternative would be to give Iran a complete get-out-of-jail-free card. They would not be the ones violating the understanding. They would not be, therefore, bound to the terms of the deal. They could pursue a nuclear program unconstrained. And we would face that reality without the benefit that we had going into the deal of global unity around the necessity of maintaining a strong sanctions regime.

So it would be foolish for the United States to rip up that deal unilaterally when it's working, when it's serving our interests, when the alternative is Iran gets out from under any obligation to constrain its nuclear program. We no longer have global unity behind sanctions, and that leaves us with the alternative of a nuclear Iran, potentially, or war.

BLITZER: Ambassador Rice, we have more to discuss, looking back, looking ahead. I want to take a quick break, resume our conversation right after this. Ambassador Susan Rice.

(COMMERCIAL BREAK)

BLITZER: We're back with President Obama's national security adviser, Ambassador Susan Rice. Ambassador, if Donald Trump were to move the U.S. embassy from Tel Aviv to Jerusalem, what would be the fallout?

RICE: Well, Wolf, I think you've seen already the reaction from some of our closest partners in the region. Most notably Jordan, that has indicated that it would put great stress on their security, the internal dynamics in Jordan and throughout the region.

Because this is a very emotional issue and one that many presidents have considered when they were running for president. Not a single American president has chosen, to date, to make that decision, because it is an extremely volatile choice and one that would put stability inside of Israel and in the Palestinian territories, in the region, and potentially even the security of American personnel in the region at risk.

BLITZER: You were the U.S. ambassador to the U.N. during the first four years of the Obama administration, now the national security adviser the second four years. What are you most proud of when it comes to national security over these past eight years? In other words, what do you see as your greatest success?

RICE: Well, Wolf, obviously I'd count a number of things. But let me mention just four very briefly. We've spoken about one, and that is the Iran nuclear deal. The use of diplomacy to achieve a very important security objective without the use of force, through pressure, sanctions and diplomacy. That's made American safer. It's made our ally, Israel, safer. It's made our regional partners safer. That's one.

The Paris climate deal and all the work that we have done to address climate change and reduce the risk of that being a catastrophic threat to the American people and to the world at large in the decades to come.

I'm also proud of our opening to Cuba and the fact that we have put behind us 50 years of failed policy and opened a relationship that will ultimately benefit the people of Cuba and, certainly, the people of the United States; and has transformed in many ways our relationship with many Latin American countries, such that our relationships in that crucial hemisphere are stronger than ever.

And finally, Wolf, I'd mention something that most Americans probably aren't aware of. And that is the work we have done to build the global health infrastructure in the poorest countries around the world, so that they can detect and contain things like pandemic diseases before they leave their shores and head to the United States.

The global health security work that we have done, which preceded the Ebola epidemic, but was underscored -- its importance was underscored by the Ebola epidemic -- is very important work. It's work that will need to continue in the years to come.

[17:25:04] But when a country like Liberia or a country in southeast Asia is able to contain pandemic flu or something like it and detect it before it becomes a threat to people around the world, that is something that's manifestly in our interests, and I'm proud that we've been able to make great strides in that regard.

BLITZER: And your biggest disappointment? Your biggest failure over these past eight years? I assume it's Syria. Is that right?

RICE: Wolf, I've spoken about this in other contexts of late. I think all of us who have worked on the tragedy of Syria feel a great deal of regret that our very robust efforts at diplomacy have not yielded a negotiated solution to what is a very horrific conflict.

We have succeeded in beating back the threat that ISIL has posed out of Syria. In Iraq and Syria, we have collaborated with 68 other countries, and we have rolled back 50 percent of the territory that ISIL has claimed. We have killed many of its senior leaders, and that fight continues.

We've also been the world's leader in providing humanitarian assistance.

But we have not yet, with the partners that we have in the region, with Russia or the United Nations or others, been able to find a negotiated settlement to that tragic conflict. And as a result, many thousands of lives have been lost.

BLITZER: Ambassador Susan Rice, thanks so much for joining us.

RICE: It's been good to be with you. Thanks, Wolf.

BLITZER: Thank you. And good luck, whatever your next adventure might be.

Coming up here in THE SITUATION ROOM, Donald Trump heaps praise on his son-in-law, Jared Kushner. Can he go from real-estate broker to Middle East peace broker? We'll be right back.

(COMMERCIAL BREAK)

BLITZER: With only four days until his inauguration, Donald Trump is showing no sign of backing away from his confrontational style. In a series of tweets and interviews the president-elect is unleashing new attacks on the CIA director, the German chancellor, Congressman John Lewis, an icon of the civil rights movement.

[17:31:34] Let's discuss with our political experts. And Gloria, this rift with Congressman John Lewis is intense. He tweeted this...

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Right.

BLITZER: This is after John Lewis said he was not really a legitimate president. He said, "Congressman John Lewis should spend more time on fixing and helping his district, which is in horrible shape and falling apart, not to mention crime-infested, rather than falsely complaining about the election results. All talk, talk, talk, no action or results. Sad."

Is it wise for the president-elect to be going after this civil rights icon, even after the civil rights icon, John Lewis, said he was not going to be a legitimate president because of Russian interference in the election?

BORGER: Obviously, you can understand why the president-elect was upset, and I don't think it was helpful, honestly, that John Lewis said that. However, I will tell you that what Donald Trump did was take a

situation that he should have defused and ratcheted it up. What he did was needless and hurtful and wrong, by the way.

I mean, John Lewis is not about talk. If there's anyone in this country who we could say, John Lewis is about action and not about talk, you know, this is a civil rights icon. The country has changed because of John Lewis.

And here we are on Martin Luther King's birthday -- the irony is not lost on any of us sitting at this table -- talking about John Lewis and the president-elect, you know, needlessly criticizing him as somebody who's all talk and no action? Just seems to me to be awful. There's no other word for me -- for me to use. It's -- it's not a place where we want to be in this country.

BLITZER: David Axelrod, Congressman Lewis, one of maybe a couple dozen already Democrats who are going to boycott the inauguration behind us on Friday. The day after he was elected president, Trump said he wants to bind the wounds of division. That clearly hasn't happened yet. Will he be able to do that in his inaugural speech on Friday?

DAVID AXELROD, FORMER OBAMA SENIOR ADVISOR: Well, he's got a lot of work to do. I mean, the wounds have been opened wider by things like this exchange. And you can't, with one set of words, heal them.

But if I were he, I would address those people who aren't there that day and tell them that "I want to work with you. I want to be the president of this whole country. If I've said things that were offensive, I regret them." You know, I think he needs to work at unifying this country.

If you look -- I know polls are discredited a little bit after the last election, but he is not coming into this inauguration with that well-spring of good wishes that most presidents do.

BLITZER: You think Donald Trump is actually going to say, "I regret that"?

AXELROD: Well, you know, hope springs -- I'm all about hope. Hope springs eternal. And I think he should. I mean, he may -- it may approximate something else, but he has to, if he wants to get off on the right foot, his message has to be one that reaches out, not just to the people who are there to cheer him, but to those who aren't there and those who are sitting at home with some apprehension about his presidency.

BLITZER: He got into a rift, though, with the CIA -- outgoing CIA director John Brennan over the weekend, as well. And it got pretty ugly.

PHIL MUDD, CNN COUNTERTERRORISM ANALYST: Seems like he's got a thing for the CIA. But I think Brennan has him possibly outfoxed here. Let's play the role for a moment of a CIA officer and watching what happened within the past 24 hours. [17:35:03] BLITZER: And you used to work for them.

MUDD: I spent 25 years with them.

So now John Brennan puts on the record, publicly, that when the president-elect, soon to be the president, criticizes the CIA, the CIA director will come out and object.

What happens if there's a tweet after the incoming individual, Mike Pompeo, who's going through confirmation hearings now, and I think he'll get through, when he comes through, if the president-elect starts tweeting then. The work force, I can tell you what they're going to say, and that is not a subtle work force. They're going to say, "You going to get out and talk to him? The previous director did."

And the leadership of that organization, what we call the 7th floor there, will walk in face to face to Mr. Pompeo and say, "We expect you to issue a statement."

BORGER: Couldn't you argue that he's setting himself up to be undermined by the people in the CIA? Not just -- not Pompeo but the people who work there, if he continues this.

MUDD: This is all about branding.

BORGER: Yes.

MUDD: Let's be simple here. I think what he's setting himself up to do is -- the CIA has a deep organization. Five days in, the president-elect, after he becomes president and has his new director, is going to say, "Look, Mike Pompeo transformed the place." I can tell you, the CIA doesn't get transformed. That culture doesn't change.

So I think it's a set-up to say, "Look, the whole CIA is new, after I put my own guy in there."

AXELROD: I had John Brennan on my podcast about a week and a half ago. And he said, if the president-elect as president continues this kind of rhetoric, what's going to happen is you're going to have a mass exodus of very experienced people from the CIA; and it's going to endanger the country. So the stakes are really large here for this kind of skirmish.

BLITZER: And Rebecca, he was very forceful. He was very forceful, Donald Trump, not once but twice, saying some of the actions of the CIA against him in recent days reminded him of Nazi Germany. And you saw John Brennan react so angrily to that comment, making a comparison to the CIA and Nazi Germany.

REBECCA BERG, CNN POLITICAL ANALYST: That's right. And actually, it was really interesting this past week to see this dynamic play out and Mike Pompeo's confirmation hearing in the Senate. I was actually there in the hearing room that day. And senators from both parties were asking Pompeo to address this, acknowledging how low morale is in the agency at this point in time because of this sort of rhetoric from the president-elect. It's really an unprecedented, sort of historic dynamic here.

And Mike Pompeo said that he was committed to address this, as the director of the CIA. Of course, that was what they all wanted to hear, and that's a part of the confirmation hearing process. But this is something that he's definitely going to need to confront. And Donald Trump is not making his job easy as the new director.

BLITZER: Mike Pompeo, the nominee to become the next CIA director, he's going to have his hands full.

Let's take a quick break, resume all of this right after this quick break.

(COMMERCIAL BREAK)

[17:42:21] BLITZER: We're now only four days away from the beginning of Donald Trump's presidency, and just as he did during the campaign, the president-elect is leaning on members of his own family for advice as he prepares to take office.

We're back with our political experts. And Gloria, you have a special report that will air later tonight here on CNN, 9 p.m. Eastern, on Ivanka Trump and the role she's likely to play. Let me play a little excerpt for our viewers.

(BEGIN VIDEO CLIP)

BORGER (voice-over): In Jared, Ivanka found a natural connection. They both grew up heirs to real-estate empires, run by powerful and controversial fathers. And both were executives in their family businesses.

ERIC TRUMP, DONALD TRUMP'S SON: They really create a force to be reckoned with. And they spend a lot of time thinking, strategizing, planning. They really feed off each other. Their personalities truly, truly feed off of each other.

BORGER: Ivanka and Jared married in 2009 at Trump National Golf Club in New Jersey. Ivanka converted to Judaism, practicing in the orthodox Jewish traditions that Jared grew up with and observes.

DONALD TRUMP JR., DONALD TRUMP'S SON: It was, you know, something that meant a lot for her, but I think it also shows how seriously she took, you know, the relationship with Jared. And that was something that was obviously a very big deal for him.

BORGER: In March 2016, and in the middle of her father's presidential campaign, Ivanka and Jared welcomed their third child, Theodore James. Brother to Arabella and Joseph.

UNIDENTIFIED FEMALE: She is a wonderful mother. She is fierce and devoted. She is up with them early every single morning, giving them breakfast and being with them. And then, you know, putting them to bed. D. TRUMP: For myself as the father of five young kids, it's really

difficult. I mean, it's really difficult work-wise. It was more difficult on a campaign where information every five minutes. It's an up and down cycle, right?

BORGER: How does she do that?

D. TRUMP: Honestly, I think the conversion to Judaism was a big part of it. Because, you know, observing the Sabbath, you know, I think from Friday night to Saturday night, it's -- there is no phones, there's no computers. And I think that was actually probably very helpful.

(END VIDEOTAPE)

BLITZER: Interesting stuff, Gloria. So give us a sense of the role we can expect she'll play.

BORGER: Well, at this point she's not having an official role, but that doesn't mean she isn't going to be important, because she is going to be important.

I think, more than anything else, first of all, her issues are women's issues: child care, tax credits, et cetera. But she's going to be a touch-stone for her father. [17:45:00] The gut check, as one of his sons said to me.

I do believe that she'll provide political antenna. She'll be involved in everything in every way, whether she's got an office or she doesn't have an office. And she'll tell her father how things are playing in Washington.

I mean, she's the one, don't forget, who brought Al Gore and Leonardo DiCaprio to meet with her father in Trump Tower. I think you can expect that same kind of effort from her when she is in the White House. And also, I believe she'll tell him when he goes too far that he needs to rein it in a little bit. Whether he'll listen to her or not remains to be seen.

BLITZER: A lot of Democrats, I have heard -- and I'm sure you have as well -- they're happy she's got an influential role. They think she's on the right page.

AXELROD: Well, obviously, when you look at issues like family leave or childcare, these are generally Democratic issues and he has embraced them. It will be interesting to see how the Republican caucus in that building behind us feel about that.

BLITZER: What are you hearing about the role she is likely to play, Rebecca?

BERG: Well, what's interesting to me, Wolf, is that she actually took more steps than her father to separate herself from her company, which suggests to me that, although, as Gloria mentioned, she isn't, for now, directly involved in the administration, it shows to me that she is prepared to be and taken the steps necessary to do so. But we've also seen the controversy that her business has caused in

the past when she wore that bangle from her clothing line worth thousands of dollars on "60 Minutes" and then promoted it afterwards, had to deal with that blowback. So we've seen her throughout the whole campaign process and afterwards sort of learning to navigate politics, at times doing so with great aplomb but at other times struggling to gain her footing.

BLITZER: It's going to be a fascinating documentary. We're looking forward to it, Gloria, later tonight. Tune in at 9:00 p.m. Eastern for our CNN special report, "FIRST DAUGHTER: IVANKA TRUMP." 9:00 p.m. Eastern later tonight.

Coming up here in THE SITUATION ROOM, the President-elect predicts his son-in-law will broker a peace deal in the Middle East. Could Jared Kushner bring the Israelis and Palestinians together?

(COMMERCIAL BREAK)

[17:51:54] BLITZER: Donald Trump is tapping his son-in-law Jared Kushner with tackling one of the toughest challenges on the planet, brokering peace in the Middle East. Kushner is also preparing to take a key role in the White House as a senior adviser to the President.

Brian Todd has new some information he is getting, new details on Trump's plans for his son-in-law. Brian, what are you learning?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, Israel and the Palestinians tonight are so far apart from even speaking to each other that neither side even showed up to a meeting in Paris this weekend, an effort to get them to talk about talking. Still, Donald Trump believes his 36-year-old son-in-law, who has no experience in diplomacy, is the man who is going to bring those two sides together.

Tonight a lot of questions are being raised about Jared Kushner's role in the White House and his possible conflicts of interest.

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DONALD TRUMP, PRESIDENT-ELECT OF THE UNITED STATES: Jared is a great young man, went to Harvard, very smart --

TODD (voice-over): One of the crucial assignments Donald Trump already has in mind for his son-in-law, bringing peace to the Middle East. "He'll make a deal with Israel that no one else can -- you know, he's a natural," Trump told "The Times" of London.

Israel and the Palestinians are currently not even talking to each other. Getting them to agree on a deal has stumped America's most experienced diplomats for decades. Analysts say in order for Jared Kushner to resolve one of the planet's most intractable problems, he has to overcome at least two significant challenges -- his lack of experience in diplomacy and President-elect Donald Trump's rhetoric.

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Donald Trump has unreservedly aligned himself with an Israeli government that has been, at the least, extremely skeptical about moving forward with any realistic two-state solution. And in the course of connecting so closely with Benjamin Netanyahu, Trump has diminished the ability of the U.S., I think, to present itself as an honest broker.

TODD (voice-over): We asked the Trump transition team about those concerns. We didn't hear back. Tonight Jared Kushner's appointment as a senior adviser to the President is also drawing controversy because he's married to Trump's daughter, Ivanka. Transition team officials say they do not believe anti-nepotism laws apply to presidential advisers, but legal analysts are split on the subject.

Kushner is pledging to take no salary and give up his management roles at his own family's billion-dollar real estate empire and the newspaper he owns. His lawyer tells CNN he'll also sell off a significant number of his assets, including this flagship building in Manhattan to his brother or to a family trust controlled by his mother. Ethics watchdogs question whether he can fully cut himself off from having a financial stake in government decisions.

LARRY NOBLE, GENERAL COUNSEL, CAMPAIGN LEGAL CENTER: The family members will still benefit from the decisions he makes in the White House. And on the other end of this is, what happens when he leaves government office? Are they then going to give him his interests back? It's really not divesting himself from this. It's not separating himself from his financial interests.

TODD (voice-over): And Donald Trump could still face political blowback for appointing his daughter's husband to such a powerful position.

MATTHEW SANDERSON, POLITICAL LAW AND EXEMPT ORGANIZATIONS ATTORNEY, CAPLIN & DRYSDALE: It may be legally questionable and politically perilous for him to choose someone close to him, and the number one qualification being that they're related to Donald Trump.

TODD (voice-over): Despite having no experience in politics or government, Jared Kushner is said to be one of Donald Trump's most trusted advisers. Some analyst call him the Trump whisperer.

[17:55:03] MONICA LANGLEY, SENIOR SPECIAL WRITER, THE WALL STREET JOURNAL: When two factions are fighting, for example, during the campaign, when some fiery conservatives wanted one thing and some of the establishment Republicans wanted another, Jared would bring them together and work it out.

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TODD: Jared Kushner would be expected to recuse himself from handling issues that directly affect his family's business, but a week after the election, he was still negotiating with a powerful tycoon from China over an investment in a property. That's according to "The New York Times." Despite our repeated inquiries, Jared Kushner did not comment for our story, Wolf.

BLITZER: Brian Todd, reporting. Thank you, Brian.

Coming up, Donald Trump revives his claim that NATO is obsolete. It's causing concern across Europe and winning new praise from Russia.

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