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Soon: Fed to Announce Whether It's Cutting Interest Rates as Trump Continues Pressure; G.M. Stops Paying for Health Care Coverage for Striking Union Workers; Rep. Tim Ryan (D-OH) Discusses the UAW Strike, G.M. Cutting Health Care, Medicare-for-All, O'Rourke's Mandatory Gun Buyback Program; Trump Revokes California's Power to Set Its Own Vehicle Emissions Standards. Aired 11:30a-12p ET
Aired September 18, 2019 - 11:30 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KATE BOLDUAN, CNN ANCHOR: Will they? Won't they? And what happened last night? It's decision time for the Federal Reserve. Chairman Jay Powell is expected to end the speculation today on whether the Feds will cut the interest rates. This will be the second time in two months.
Despite this, he is still under intense pressure from the president of the United States. President Trump constantly hitting the chairman that he appointed, a reminder, to the post. On Monday, he said that Jay Powell and the Feds don't have a clue. He has also called them boneheaded.
Joining me, another bonehead, Rana Foroohar.
RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: Hey!
BOLDUAN: I don't know why, it's such a good term to use. Under appreciated and under used.
OK. Rana, so on this, it does seem at this point like it would be more of a surprise if the Fed chairman would not, would keep interest rates the same.
BOLDUAN: What are you, though, listening for after the fact that could be more important even when an announcement comes?
FOROOHAR: I am listening to two things. One was alluded to by Chairman Jay Powell. He said a couple of weeks ago in his speech, look, he was flying blind here. He didn't use that exact term thank god. But he more or less said there's no precedent for where we are today. So it's possible that we could see a rate cut and it would buoy the
market a little bit. It's possible we could see a rate cuts and stocks would be flat or fall and markets would start to get worried, oh, wow, we're at the end of the fire power here that the Fed has, what else is in the kitty? The answer is nothing.
It's also possible that you could see them hold and not cut rates and that would, in turn, scare markets. Because right now, and I have been saying this for years, the markets are totally dependent on the Fed action. I think we're at the end of a growth cycle. I think we're close to what would be a normal recessionary period.
I know that sounds scary. There are cycles in the economy.
FOROOHAR: It's natural to get a slowdown sometimes. We're kind of at that point. That's why everyone is so jittery.
BOLDUAN: Jay Powell is between a rock and a hard place.
BOLDUAN: Quickly, a couple things. The president called for negative interest rates. Not that that would be the announcement, but what would that do?
FOROOHAR: We've seen it in Japan. They've had negative interest rates. It penalizes savers. It makes it hard for people saving money because you are not earning interest on that money. It penalizes older people on pensions, on fixed incomes.
It would be good for corporate debt, which may be one of the reasons he wants it. He wants corporations to continue to take on debt, for the markets to stay up. But overall, in the economy, I don't think it's a great thing.
BOLDUAN: So then there's this, Rana. Something happened overnight that is raising alarm. The New York Fed launched what's called an overnight repo operation, which sounds very scary to respond --
FOROOHAR: Yes. Overnight operations are never very good. I've got news for you.
BOLDUAN: To respond to a spike in overnight borrowing rates. This is something, most folks, me included, know very little about. I do know this has not happened since the last financial crisis. So what's behind this?
FOROOHAR: A lot of nervousness. What you need to know is, is this repo action basically speaks to the trust banks have in each other, institution have in each other. Right now, there's a lot of worry in the market that there's something
hiding. Whenever debt goes up, which has gone up tremendously in the last 10 years, it covers a lot of problems.
We're at the end of the cycle where debt can cover problems. Everyone is wondering, where is the exploding package of debt going to be. So borrowing rates between banks are going up. That's what the Feds are trying to cover.
I think I will be back here in the next few weeks talking to you about some major market movements.
BOLDUAN: Oh, great. Whenever Rana says that --
BOLDUAN: -- I'm a little excited and a lot nervous.
Thank you, Rana. I really appreciate it.
FOROOHAR: Thank you.
BOLDUAN: OK. Let's see what Jay Powell says later this afternoon.
Still ahead for us, a major blow to almost 50,000 G.M. workers who are on strike. Next, why the company is denying health care coverage for striking union members. And how the Democratic presidential candidates are making an issue of it.
We'll be right back.
BOLDUAN: We are now looking at a third day of strikes at General Motors. That means the third day G.M. is taking a hit, production has effectively been halted.
That means a third day they are hit because the paychecks aren't coming in like they were. Now G.M. has dropped their health care plan. And there doesn't seem to be an end in sight.
Nearly 50,000 union workers walked off the job Monday. The fight is over wages and job security.
It's now making its way to the 2020 campaign trail. Senator Bernie Sanders, for one, is using this strike to, once again, pitch his Medicare-for-All plan. Listen to this.
(BEGIN VIDEO CLIP)
SEN. BERNIE SANDERS (I-VT): Here you have a situation where UAW out on strike, 49,000 workers.
They cut off the health care benefits for those 49,000 workers. On the Medicare-for-All, on the Medicare-for-All, every American, whether you are working, whether you are not working, whether you go from one job to another job, is there with you.
(END VIDEO CLIP)
BOLDUAN: Another candidate who is hitting the picket lines with the workers, Democratic Congressman Tim Ryan. He joined union workers in Ohio yesterday. He's in Michigan today.
He joins me right now.
Congressman, thanks for being here.
REP. TIM RYAN (D-OH): Thanks for having me, Kate.
BOLDUAN: Appreciate it.
What are you hearing from union workers in the midst-of-this?
RYAN: Well, they're taking a stand. They're very enthusiastic. Obviously, these things are very difficult. They're taking a stand on behalf of the United Auto Workers. But I think workers across the country that are clearly fed up with a system over the last 30 or 40 years where the CEO's got a 900 percent increase in what they earn and a worker got 12 percent increase.
These guys just want a piece of the action. They want a little taste. And they gave up a lot when General Motors was having a lot of difficulties. The American taxpayer came to the rescue of the auto companies. The auto workers made a lot of sacrifices.
Really, all they're asking for is to get back what they gave up in 2008. And I think we should be on their side trying to make them whole. They did the responsible thing. And these are the last -- you know, this is the last bastion of middle-class jobs in the United States and we need to hang onto them.
BOLDUAN: Especially, you are talking about the middle of the country and workers in the middle of the country, is something that you uniquely have been speaking to throughout the campaign.
But this -- the idea of G.M. dropping health care for the union workers. This is the exact debate that you had with Bernie Sanders on the stage at the CNN debate in Detroit at the end of July.
For our viewers, I want to play a bit of the exchange about health care and unions. Listen to this.
(BEGIN VIDEO CLIP)
SANDERS: Well, two things. They will be better because Medicare-for- All is comprehensive, it covers all health care needs for senior citizens. It will finally include dental care, hearing aids and eyeglasses.
RYAN: But you don't know that. SANDERS: Second of all --
RYAN: You don't know that, Bernie.
SANDERS: Second of all -- I do know it. I wrote the (EXPLETIVE DELETED) bill.
(END VIDEO CLIP)
BOLDUAN: And this was all about health care coverage for unions. This is exactly what was happening on the debate stage.
The arguments that Sanders is making now, is, if Medicare-for-All was in place, these workers you were speaking to, they would not have to worry that their health care just got dropped? What do you say?
RYAN: I would say these workers like their health care. I was in union hall in Flint, Michigan, with a 37-year-old guy. They had him and his wife. They had twins. There was issues with the pregnancy. He kept saying, thank god I had really good health care.
And to go into an election, to go into Ohio, Michigan, Wisconsin, western Pennsylvania, and tell union members that you've got a better deal for them than the health care that they already have and they like, is a -- I think it's bad policy --
RYAN: -- and I think it's political disaster.
BOLDUAN: Do you think that this moment of what G.M. workers are experiencing with G.M. could change their minds though?
RYAN: I think you know you'd have to ask them. But I would say they like the health care they have.
And you can't take one example of a strike and say that this should be dictating all union workers or people who like their private insurance. That's the big question. Do you like what you have? If you do, the federal government and Bernie Sanders and Elizabeth Warren and others shouldn't be coming into you, into your home and saying, you have to get on this other alternative government program.
What I'm saying is, build the alternative government program. Build the public option out. Build in the ability to buy into the Medicare program. If you want to. Not you have to. And that's the big distinction.
And I'll tell you, campaigning in these industrial states and the general election against Donald Trump on, you have to go into the Bernie Sanders' plan, whether you like it or not, is a political disaster for Democrats.
BOLDUAN: I want to ask you about another topic. Because the president this morning is going after one of your competitors, Beto O'Rourke, over his stance on gun reform that, obviously, became very well-known during the debate.
I want to read you the tweet. He says, "Beto made it much harder to make a deal, convinced many that Dems just want to take your guns away."
This comes from his mandatory buyback gun program. I have heard from other Democrats that Beto O'Rourke's push for mandatory buyback gun program could hurt Democrats now with negotiations and down the road in electorally.
This is personal for you after the shooting in Dayton.
BOLDUAN: Where are you on this?
RYAN: I would first say Donald Trump has never genuinely wanted to do anything around the issue of gun violence in the United States.
There's a comprehensive background check bill that 90 percent of the American people support that we pass out of the House that sits at the Senate and Mitch McConnell is not acting on it because Donald Trump has not given him the green light to go ahead and do that. And there are a variety of other things that we can do.
So Trump should not pretend he's somehow actually wants to get something done. I think we need to move on these issues where we have 66, 70, 80, 90 percent of the American people in agreement. That means the comprehensive background checks.
BOLDUAN: That is not the mandatory buyback program.
RYAN: It is not. It is not. But it's an assault weapon ban. It is a voluntary buyback. It's --
BOLDUAN: But Beto O'Rourke talking about this saying, yes, I will talk away you're A.R.-15, I mean, does it hurt negotiations now? Does it hurt you guys?
RYAN: I don't think it should. I don't think a presidential candidate, one of 15 or 16's position on one particular issue have anything e any effect on the negotiations at all. You know, Beto had personal experience in his state and he is coming out of that with this position that he has. I think he should be free to share that with the American people.
And Beto is not in Congress. So his opinion on it shouldn't have anything to do with congressional negotiations around a comprehensive background check that 90 percent of the American people support.
I think it's -- it has no connection at all to what we need to do in Congress.
BOLDUAN: Congressman Ryan, thank you for coming on. RYAN: Thank you. Thanks for having me.
BOLDUAN: Appreciate it.
We'll be right back.
BOLDUAN: President Trump just opened a new front on his war with California. Just announcing that he's revoking California's power to set its own vehicle emissions standards.
Here's part of the tweet that he put out just now. He says that he's making this move "in order to produce far less expensive cars for the consumer while, at the same time, making the cars substantially safer."
There's a whole lot more there. That's what the president says. You can be sure there will be many a fact-check to follow on that.
Up until now, California historically has been allowed to have stricter standards. What happens now? Is this the end of it or just the beginning?
CNN's Nick Watt is joining me now from Los Angeles with more.
Nick, what are you hearing?
NICK WATT, CNN CORRESPONDENT: Well, Kate, California officials knew this was coming so we got preemptive reaction from them last night. The attorney general here said, President Trump, if you stand in our way, we will see you in court. And no doubt they will.
The governor said this is all part of what he calls a political vendetta.
Listen, President Trump, as you mentioned, fighting California, arguably the bluest state in the land. Also this kind of clash of political egos between President Trump and Gavin Newsom.
The fact the president tweeted this from his hotel room in Los Angeles. Coincidence? I'll leave it to others to make that call.
Here's the background. California has been able to set its own standards since 1970 because California's clean air emissions standards predate any federal legislation, brought in when Ronald Reagan was governor here.
The Trump administration has already said they want to roll back some of the emissions standards that President Obama introduced. And frankly, if California still has this right, then that could be toothless. So this is the opening salvo in what will be a long war -- Kate?
BOLDUAN: Also noteworthy, what you just said, that those standards were brought in under a Governor Ronald Reagan.
BOLDUAN: Ronald Reagan.
Great to see you, Nick. Thank you.
WATT: Thank you.
BOLDUAN: Coming up still, Saudi Arabian officials presenting what they call material evidence of Iran's role in the attacks on two major oil facilities. Much more on that after the break.