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164,000 Jobs Added in July, Unemployment Holds at 3.7 Percent; U.S. Pulls Out of Nuclear Treaty with Russia; U.S. Prepares to Withdraw Thousands of Troops from Afghanistan; Democrats Head to Las Vegas Looking for Major Labor Union's Support; Marianne Williamson Confronts Past Statements About Antidepressants; Pelosi Under Pressure as Caucus Nears 50-50 Split on Impeachment. Aired 9-9:30a ET

Aired August 2, 2019 - 09:00   ET


[09:00:14] POPPY HARLOW, CNN ANCHOR: All right, good Friday morning, everyone. I'm Poppy Harlow.

JIM SCIUTTO, CNN ANCHOR: And I'm Jim Sciutto. Breaking news out just a few minutes ago. 164,000 new jobs added to the U.S. economy last month.

HARLOW: The numbers show the job market is still moving, but can it keep growing? As trade fears deepen, with us now our chief business correspondent Christine Romans.

Romans, go through the numbers.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: OK, 164,000 jobs, that's exactly what economists had been expecting. Exactly what they had been expecting. But the previous two months were revised downward, so that's kind of key here. You lost about 41,000 jobs in the last couple of months. So it shows job growth is there, but it's not quite as robust as we had seen earlier in the year and certainly not as robust as last year.

The unemployment rate, 3.7 percent, again exactly in line with what economists had expected. You can see the 10-year trend has been amazing. And we do know, Poppy and Jim, that about 300,000 and some people came back into the job market. That's good. That means they're watching these numbers and they think maybe there's hope for them to get a job when they need a job and they're doing that. 3.2 percent wages, that's also another good number.

Look at business, 31,000 there. You know, it's interesting, these jobs are computer systems designer jobs. A lot of that kind of growth. Very high-tech skill jobs in that part of the economy. Health care, same there. Manufacturing only 16,000 jobs and the government points out manufacturing employment for the year is little change, not as robust as last year. That might be where you're really starting to see the president's trade wars crimp.

Now I want to show you some perspective. This is average monthly job gains. For the year now we're looking at about 165,000 net new jobs each month. That's slower than they're at last year. We had 220,000 and certainly the slowest we've seen in some time, so there's something happening here. There is still job growth, no question. Wages about 3.2 percent. We're seeing jobs growth in health care, we're seeing it in services. We're not necessarily seeing it in making stuff, and the president's trade wars are going to add a -- and the Fed's rate cut are going to add a very new kind of complexity as we move into the fall, you guys.

SCIUTTO: Good break down.

Let's continue this conversation with Diane Swonk, she's a member of the Council on Foreign Relations, also chief economist at Grant Thornton, and Christine is staying with us.


SCIUTTO: So, Diane, there's something going on here as Christine Romans says. You have some concerns on Wall Street and elsewhere that you're beginning to see signs of an economic slowdown. At least some predictions about that next year. And yet each month the figures are pretty good. Yes, revisions in the last couple of months downward, but 164,000 jobs, economic growth still looking good.

Do you see signs in the big picture of potential slowdown?

DIANE SWONK, CHIEF ECONOMIST, GRANT THORNTON: Well, we are seeing a slowdown. The good news is the slowdown is still enough to hopefully over time eat away at the unemployment rate and keep those wages high.

I think Christine made some very good points about the high-tech sector really showed up in these numbers where there's a lot of growth and that's buoying wages as well. On the flipside of it, the -- the unemployment rate stayed at 3.7 percent for the right reasons. The participation rate in the labor market increased a little bit, and it was really teenagers, 16 to 19-year-olds. These are kids that are really shutout of the labor market when they had to compete with people who are literally feeding their families during the height of the crisis and in the years that followed.

They're competing with 55-year-olds to get sort of minimum wage jobs. We're finally seeing those teenagers come back and that's something encouraging as well. So that's good news. On the manufacturing job that Christine mentioned, that's where weakness from the trade is and those vehicle production jobs we know a whole lot of plants actually closed at the end of July. So that's going to be a lot weaker in August, and of course retail continued to decline.


SWONK: That's before the next round of tariffs that we're seeing that will hit retailers directly.

HARLOW: And guess where those biggest auto plants close in the last two months, Ohio and Michigan, two really important states for the president.

Romans, let's talk about jobs and the trade war with China that just got a whole lot worse because the president is going to slap these extra tariffs on. We have the head of the U.S.-China Business Council saying that they think that this is going to hurt the chances of China coming back to the negotiating table. It's going to impact things like iPhones.


HARLOW: And toys.

ROMANS: It's going to impact end-of-the-line manufacturing goods now. So the White House has been I would say smart in an odd way for making sure that they were not targeting things that consumers can feel right in their grocery cart right away, so like shoes and apparel, you know, clothing, winter coats and consumer electronics.

Now they will feel that 10 percent. The president has more leverage, too. He has another 15 percentage points that he can put on there, that he has threatened before, so he's trying to get the Chinese at least back to the table where they were in the spring.

[09:05:04] And he's coming through on his -- it's very clear to me that he's irked that the Chinese are not buying soybeans and the Chinese are not stopping Fentanyl coming into this country and he's retaliating.

HARLOW: Yes. Yes.

SCIUTTO: So, Diane, the Fed had this in mind when it did this most recent rate cut, trying to soften the blow. Trade war, global economic slowdown. Also with inflation still low. I wonder, though, does this lessen the ability of the Fed to soften any further slowdown or even fears of a recession next year?

SWONK: Absolutely, that's one of the things the Fed is worried about, and of course they were split in their own views on what they should do. I think much of the beneficial effects of the lower rates, we've already felt. You saw mortgage rates come down, mortgage refinancing pickup, and all of that helped in the confidence that J. Powell talked about, helped to support the rebounding consumer spending we saw in the second quarter.

Going forward this ups the ante on another cut but for the wrong reasons because we're now talking about even greater headwinds that the U.S. economy must fight and it is us paying the taxes. And as Christine really rightly pointed out, up until now it was in the supply chain. This is going to show up in consumers' wallets.


SWONK: Right when they go back to the back-to-school season.

HARLOW: By the way, it's not just this. It's not just this additional 10 percent tariff which is, as, Jim, you always point out, a tax.

SCIUTTO: Yes. HARLOW: Which means that now almost all -- pretty much all goods

coming to this country from China will now be taxed. And you're going to pay for that, by the way. Every U.S. consumer. But this isn't the end of the line, Romans. The Chinese Foreign Ministry just said this morning.


HARLOW: China will, quote, "take the necessary counter measures" against us. What should the U.S. consumer expect in term of a China counter punch?

ROMANS: Well, I mean, I'm worried about farmers and I have been for months. I'm really worried about farmers because, you know, the longer those soybeans sit in storage, the worse it is for farmers and farm bankruptcies we already know are up a lot over the past couple of years and soybean purchases are the lowest since 2004. So that soybean part of it is a very big deal.

I think for consumers in particular they're going to start feeling it right away. You heard the president say yesterday, he said, you know, this is not -- inflation is low, consumers aren't feeling this. Well, they have been insulated a little bit until now because companies and even the Chinese manufacturers have been trying to find ways to share the pain a little bit thinking that this was going to be temporary, this trade war. I think this trade war is permanent now. This is a permanent condition. And it really --

HARLOW: Permanent.

ROMANS: It really sort of -- as we said yesterday in one of our stories, it breaks the compass of the Fed. The Fed has this compass it uses to decide how to be the shock absorber on the American economy and the president took a hammer and smashed it.


ROMANS: And so now, you know, trying to figure out where we go from here is really hard stuff.

HARLOW: And Diane, you -- we're out of time. But you wrote about that. You were tweeting about the risks of unintended consequences, you know, trying to abide by law in a lawless world, and everything has been turned upside down at this point on this front.

Thank you both, ladies, for your expertise. Diane Swonk and Christine Romans.

Meantime a lot of international news this morning. The Trump administration is closing in on one major potential peace deal and closing the door on another. Right now, the U.S. is negotiating in the middle of peace talks with the Taliban. If a deal is reached, that's still a big if, it could pave the way for thousands of troops to return home from Afghanistan. And it would be a major step forward in ending America's longest running war. Talks come as two U.S. soldiers were killed in Afghanistan this week.

You see them right there. Those soldiers have been identified as Private 1st Class Brandon J. Kreischer and Specialist Michael Isaiah Nance. Five U.S. service members have been killed in Afghanistan in just over a month -- Jim.

SCIUTTO: And of course the Taliban responsible for the deaths of hundreds of U.S. soldiers there. And just hours ago the U.S. formally withdrew from a decades long intermediate range missile treaty with Russia. There's now just one active nuclear treaty between the world's two largest nuclear powers, the U.S. and Russia. What does that mean for the world?

CNN's Barbara Starr and Kylie Atwood, they join us now. But, Barbara, let's begin with this. The U.S. has said for years that Russia violated this treaty. They gave Russia opportunities to pull back, perhaps renegotiate, that didn't happen so now a formal withdrawal by the U.S. and the U.S. is already testing missiles that would have been banned by that treaty. What are we learning?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, they may test them in the coming months. That's the plan right now that the U.S. would step in. It's really important to understand intermediate range. What we're talking about and why it's so important to everyone. We're talking about the prospect of missiles in Europe.

Russia has deployed already several battalions of these intermediate range missiles on its territory. What can Russia do with them? In conflict they could target European cities, airports, ports, military bases, civilian infrastructure, basically make it much more difficult for Europe to respond in a crisis and make it especially difficult for U.S. forces to quickly get to Europe and defend the continent if it were to come to that.

[09:10:10] So that's why you see the U.S. now in response to Russia moving ahead with its own intermediate range missile program missile effort. They are in the very earliest stages of testing what they have seen, what they can make work, and trying to get the funding from Congress to move ahead. It could result in the coming months, years, possibly in missiles, U.S. missiles being placed in Europe. You would have to get basing rights for it, and -- but, you know, it steps up the arms control race and it puts Europe right in the crosshairs of this superpowered competition, if you will -- Jim, Poppy.

SCIUTTO: Yes. And back to a situation in the '80s which was highly volatile and as relations, tensions between the U.S. and Russia rising.

Let's bring in CNN national security reporter Kylie Atwood.

So, in Afghanistan, America's longest war, we're 18 years in now, discussions of a deal with the Taliban. I mean, this is volatile as well. The Taliban killed hundreds of troops, it's killed thousands of Afghan civilians and security forces. What would this deal look like and how close are the two sides? KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: Well, this is the

first time that we're seeing from Ambassador Khalilzad who is the chief negotiator with the Taliban some hopeful sentiment that they will actually achieve an outcome here. That they'll come to some sort of an agreement. He tweeted this week that they could conclude these talks, this next round of talks in DOHA potentially. And what we are learning is that the U.S. is hoping that some sort of an agreement with the Taliban will indeed pave the way for the U.S. to start withdrawing its troops bringing down those numbers.

Right now there are about 14,000 U.S. troops in Afghanistan. We are learning that U.S. officials have told Afghan government officials that they want to bring those numbers down between 8,000 and 9,000. That's a pretty drastic drum and it hinges on this peace agreement, this deal, some fruition with the Taliban. Of course, they have to question how reliable are the Taliban here?


ATWOOD: Are they going to be the ones at the table committing to something and then not following through especially when it comes to counterterrorism which is something that Ambassador Khalilzad has said there could be some forward movement on?

The other thing to point out, however, is that this U.S. troop withdrawal is not in motion right now. What is in motion is a drawdown of personnel at the U.S. embassy. The U.S., the Trump administration wants to get the numbers down to 50 percent by the end of September. And they are working on that our reporting tells us right now.

SCIUTTO: Well, the other issue, too, right, is that the president has telegraphed he wants this reduction by the 2020 election. There's a political timetable here. The president accused Barack Obama of going by the political timetable and that has pressured this as well.

ATWOOD: And Secretary Pompeo is under some pressure to deliver on that, right?

SCIUTTO: Yes. Yes. Kylie Atwood, thanks very much.

Still to come this hour another prominent Republican is calling it quits. The only African-American Republican in fact in the House. He says he won't seek re-election. And 2020 Democratic candidate Marianne Williamson, facing tough questions from our colleague Anderson Cooper. What she now says about her history of controversial critical comments on the use of anti-depressants.

HARLOW: Plus another Kennedy family tragedy this morning. We have new details about the death of one of Robert F. Kennedy's grandchildren. We are live outside of the compound. We'll be right back with that.


[09:15:00] JIM SCIUTTO, CO-ANCHOR, NEWSROOM: It is a big weekend for 2020 Democrats as most of them head to Las Vegas this weekend. They're hoping to win over the largest public employee labor union in the country. The American Federation of State, County and Municipal employees.

POPPY HARLOW, CO-ANCHOR, NEWSROOM: They're not just going to play blackjack? OK, all right. It also comes as many --

SCIUTTO: Always time for that --

HARLOW: Of those same -- always time for that. Same 2020 hopefuls try to walk back and sort of explain all those criticisms they made of the Obama administration on the debate stage this week. Let's talk about it. Julie Hirschfeld Davis is here, congressional correspondent for the "New York Times", and Asma Khalid; political reporter for "NPR". Good morning to you both, Asma, welcome to the show. We haven't had you on --


HARLOW: Before, we're so glad you're here. Guys, listen to Joe Biden, post-debate and how he read that criticism. Here he is.


JOE BIDEN, FORMER VICE PRESIDENT, UNITED STATES: I must tell you, I was a little surprise at how much the incoming was about Barack, about the president. I mean, I'm proud of having served him and I'm proud of the job he did. I don't think there's anything he has to apologize for, and I think, you know, it kind of surprised me the degree of the criticism.


HARLOW: And Asma, if you look at the subsequent interviews that many of these candidates have given on this network after the debates, they seem to be trying to walk it back and temper their criticism a little bit as well. Do you think their read is, well, maybe not the best idea to criticize a president with 95 percent favorability in the Democratic Party?

KHALID: But you know, it was a really interesting night, I was at the debates, and when we saw the overwhelming criticism, I would say of President Obama in comparison to the current president, President Trump, I do think there was some confusion from the Biden camp in particular, and I heard that criticism immediately from some of his senior advisors.

You know, one other thing as you mentioned is that President Obama remains enormously popular in the Democratic Party. The other thing to point out, though, is that you know, I'm sort of confused as to which way this will play because the Democratic Party, if you look at it, compared to a decade ago, voters are increasingly identifying themselves as being more liberal than moderate.

And so, I do think that maybe there was a miscalculation from some of the progressives that there was room to criticize the president while at the same time sort of moving towards that sort of more liberal progressive at angle of the Democratic Party that it seems like more voters are self-identified with.

[09:20:00] SCIUTTO: So, Julie, there's a question of whether it's a smart strategy, but to the why of this, to Asma's point, is it that they feel to win in the primary you've got to energize the far left part of the base even if they know that a bigger part of the base, say in a general is more moderate?

JULIE HIRSCHFELD DAVIS, CONGRESSIONAL CORRESPONDENT, THE NEW YORK TIMES: Well, right, I think that's obviously always a tension in a primary, but it's particularly fascinating now because the party has really shifted a lot at least rhetorically since President Obama left office. You hear a lot of these candidates endorsing things like Medicare for all, things like decriminalizing border -- illegal border crossings, things that are quite a bit to the left of where President Obama was.

And so substantively, they are trying to stake out, I think a very different ground, knowing that the primary electorate is leaning in that direction. But the implications of that are again sort of perplexing because you have a situation where you have a very popular former president, you have his vice president running for the nomination and the contrasts were so sharp that you got the real sense that there was an adversarial sort of stance there.

And I think that, that is going to be a difficult place for some of these candidates to sustain.

HARLOW: Yes, not to mention, right, Jim, the president -- President Trump said this, like I'm surprised --

SCIUTTO: Oh, yes --

HARLOW: They were attacking Obama more than me --

SCIUTTO: He's loving that, he's loving it, yes --

HARLOW: No, totally. OK, guys --


HARLOW: Let's move on to a fascinating and really important interview if you missed it last night that our colleague Anderson Cooper did with Marianne Williamson, of course, after the first night of the debates this week, she was the most Googled candidate, a lot of people are learning about her, and therefore it's important that they know her stances on some really important issues.

Anderson pressed her repeatedly on previous statements she has made on the use of anti-depressants in this country. Watch this.


ANDERSON COOPER, CNN: A few months after Robin Williams died by suicide, you posted a thing I'm putting on the screen, implying that anti-depressants were the cause of William's death. And you wrote, "the truth about anti-depressants, helpful for some and harmful for others."

And then you linked to this article that was clearly suggesting anti- depressants played a role in his death.

MARIANNE WILLIAMSON, AUTHOR: Anderson, if somebody is helped by anti- depressants, I'm happy for them. I'm not talking about people who are suicidal, I'm talking about people who are depressed about the world today, given the fact that the world is depressing.


HARLOW: So, I guess, Asma, to you, first, I mean, this is fair game and you know, everyone should watch it, there was like six or seven minutes just on that issue that everyone should watch. And I just wonder what your takeaway is and how important it is for people to hear her stance on this stuff?

KHALID: Yes, so, I guess, I don't mean to be dismissive entirely of Marianne Williamson's campaign. But I do think there's a sense within the broader Democratic Party that Williamson's campaign is just not necessarily a very serious campaign. You know, already we have qualifications for the next debate that's going to be held in Houston in September.

This far, there are eight candidates who have qualified, met those fundraising and polling requirements, and Williamson is most likely not going to be on stage. So, you know, while I think her stance is really interesting to some folks, and there's a kind of curiosity of her and of her campaign, I would say broadly-speaking, there's a consensus that she's not really a serious candidate in the party.

SCIUTTO: Julie, though, I suppose the concern is that you have these positions that bubble up to the surface because Williamson also in the past has expressed anti-vaccine views as has the sitting president of the United States, although he's pulled back from that. But the point is, you have some quite extreme, not necessarily fact-based positions that have bubbled up into the national conversation here.

DAVIS: Well, right, I mean, it was actually kind of interesting to see how much focus there was both among Democrats and frankly among Republicans to Marianne Williamson's performance in the debates this week -- in the debate this week. They seemed really fascinated with her. But part of the reason why I think is because she does talk about some of these issues that other candidates aren't talking about.

Mental health and treatment for mental health is, you know, a huge issue, and it's something that, you know, the public cares about and it's something that she obviously is comfortable speaking to. But she has taken -- and she talks in sort of an unusual way, she's not a typical politician, and so, you are going to get some scrutiny to some of these positions that she's putting out there or just suggesting that she really isn't used to and has gotten in the past. And I think --


DAVIS: The anti-depressant debate is a good example of that.

HARLOW: Yes, and look, Anderson noted in the interview, a lot of this stuff, guys, is on -- right on her website. So, if you are intrigued, go to her website, read the positions and do your -- do your homework. Thank you, ladies, have a really nice weekend, Julie Hirschfeld Davis and Khalid.

So new pressure maybe this morning on Nancy Pelosi as House Democrats are now just one lawmaker away from a 50-50 split among House Democrats on impeachment. How will she respond?


HARLOW: All right, welcome back. Well, this morning, House Democrats are this close to a new milestone on impeachment. According to CNN's count, if just one more member of the house joins the call to impeach the president, the caucus would be split 50-50. On the issue, let's go to CNN congressional reporter Lauren Fox, she joins us now.

Pressure has been mounting on the speaker for months. You've got, I think about 23 House Democrats who have added to these sort of pro- impeachment column since the Mueller hearing. But is it going to change Pelosi's mind?

LAUREN FOX, CNN POLITICS CONGRESSIONAL REPORTER: Well, you know, it was just a few months ago that my colleague Manu Raju asked her and pressed her.