Greetings Jason, good question, and there are actually a couple ways to do this. The first method to try is to use the Line/Arc command. With this option pick the first circle at the first point of tangency, then move your cursor around until you see the line has snapped to being tangent (don't click yet). You will know that it has snapped to the tangent point when you see a small icon that looks like a circle with a tangent line. Once you have found the tangent snap point hit the letter "b" on your keyboard (this starts the Bend/Arc portion of the command). Now move your cursor over to the second circle and again move along the circle until you find that same tangent snap icon, and then click to end the arc.
With the second method, rather than use the arc command, you can use the circle command as you have an option to set a tangent point. Once you start the circle command, right click and choose Start Tangent, then pick the first circle you want to be tangent to. Next you will be defining the circle center, but notice that as you move the center such that the new circle intersects the second circle to be tangent to, you can find the tangent snap options.