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Suspect In Idaho College Murders Appears In Court; U.S. Inflation Slowed For Sixth Straight Month In December; Biden Lawyers Find Another Batch Of Classified Docs At His Delaware Home. Aired 11:30a-12p ET

Aired January 12, 2023 - 11:30   ET

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

[11:30:00]

JEREMY DIAMOND, CNN WHITE HOUSE CORRESPONDENT: More in the second batch. But beyond that, there is this issue of cooperation and of potential questions of obstruction. Remember that that search that was ultimately carried out with a search warrant by FBI officials at Mar- a-Lago was only carried out months after there had been discussions between Trump's team and the National Archives over handing over documents. And the Department of Justice only carried out that search after they discovered that more documents were still being held even after an initial batch was handed over, even after a Trump attorney signed a statement saying all documents had been handed over.

So, there are a number of significant differences and that's not to downplay the seriousness of what's happening with President Biden. But when Kevin McCarthy, the Speaker of the House, is saying that there is a double standard here, what is really happening is that there is -- there are two very different situations here with overlapping interests, overlapping issues, of course, but different situations nonetheless.

KATE BOLDUAN, CNN ANCHOR: And two things can be true at once, then you're making, you -- and you lay that out very clearly. Nia, how big -- you can see that it is -- the Republicans are jumping on it, how big of a problem with the news that we're learning about President Biden and the documents being found in his Wilmington home? How big of a problem do you see this becoming?

NIA-MALIKA HENDERSON, CNN SENIOR POLITICAL ANALYST: Listen, Democrats are frustrated that the Biden administration and Biden has handed Republicans a political gift. You saw Kevin McCarthy there laying out the way that Republicans are going to approach this. They obviously are going to have their own oversight. Lindsey Graham has called for a special counsel, and we'll see if that happens when Merrick Garland talks today.

The Democrats I talked to actually think a special counsel would be a good idea in this instance. You know, the sort of downside of the special counsel is we've seen what happened with special counsels before. You think about what happened to Clinton, something that started with real estate that ended with Monica Lewinsky in an impeachment. So, listen, I mean, Democrats think that so far, Biden has handled it in the best way he could. You saw him very much on script today in talking about it. But listen, they are frustrated and a little nervous about what can happen. And in some ways, they say, well, maybe having the special counsel would sort of tamp things down and allow them to essentially say, listen, this is something that's happening with the special counsel. But again, you don't know what happens if you get a special counsel poking around. It can begin -- it can begin somewhere -- in somewhere completely different, which I think if you're the Biden White House, that is a particular worry.

BOLDUAN: So, thanks, guys for sticking around. I really appreciate it. Thank you very much.

All right, this also this. The man accused of killing four Idaho college students, he is back in court right now. What can -- what we can expect to come from today's hearing and today's appearance and where this case goes next. That's next.

(COMMERCIAL BREAK)

[11:37:26]

BOLDUAN: The man accused of killing four University of Idaho students is back in court this morning, Bryan Kohberger faces four counts of first-degree murder. He has yet to enter a plea. This is his second appearance in court since being extradited you'll remember from Pennsylvania where he was first arrested.

Jean Casarez has been watching this. She's joining me right now. Thanks for being here, Jean. What has happened in court?

JEAN CASAREZ, CNN CORRESPONDENT: Very important. We have just learned a date of June 26, there's going to be the probable cause hearing. This is a very important hearing because this is where the prosecutor has to put on evidence to show exactly what they have. And then if they have enough, the case will be bound over for trial. But the defense can cross-examine. We may learn more -- at this point, we just have the affidavit.

And yesterday, I was speaking to a former FBI attorney, 20 years he was with the FBI. He was the co-founder of the forensic genetic genealogy division of the FBI. And I asked him, isn't there more than what's in this probable cause affidavit? I specifically asked him about DNA at the scene.

(BEGIN VIDEO CLIP)

STEVE KRAMER, FORMER FBI ATTORNEY & FOUNDER OF BUREAU'S GENETIC GENEALOGY TEAM: Very well could be. I don't know. IT didn't indicate whether or not he was wearing gloves. It leads me to believe that if they found DNA on the button of the knife sheath that he was not wearing gloves. So, in that case, very, very likely that he perhaps touched, you know, the door to get in and out of the residence, the door to the other rooms.

(END VIDEO CLIP)

CASAREZ: So, it's things like this that I think we can expect that that probable cause hearing. One more thing today, no bond for the defendant. He will remain in custody.

BOLDUAN: He will remain behind bars. OK, Jean, thank you so much. I really appreciate that.

CASAREZ: Thank you.

BOLDUAN: Joining me now is CNN's senior law enforcement analyst Andrew McCabe. He's, of course, the former Deputy Director of the FBI. Andy, this is one of those appearances in court where Jean sums it up perfectly. He came in, they set a date, and kind of they went along. There's a lot to happen now between now and that probable cause hearing.

I want to walk through a little bit of what we do know so far, which is in that affidavit, the most notable pieces of evidence that we have from the probable cause affidavit, Andy. One of the things is phone records indicating that Kohberger's phone was near the murder victims' residence at least 12 times between June of 2022 to the time -- around the time of the arrest. How is that helpful?

ANDREW MCCABE, CNN SENIOR LAW ENFORCEMENT ANALYST: Well, it's a fascinating fact for us, Kate, because this is really the only thing in the affidavit that even hints at a connection before the homicide between Kohberger and these victims. You know, we still don't have any sense of what his motivation might have been, how he became focused on this house, and or these people.

[11:40:07]

But the fact that he was in the area, his phone puts him in the area of the house on 12 occasions prior to the homicide is a pretty strong confirmation that long before the murders, he was already focused on this residence. And I -- like I said before, and or focused on the occupants of that house, so it's our first effort to build out what might have been happening in the lead up to the homicide.

BOLDUAN: But then there is that knife sheath. I've been curious to ask you kind of -- I don't know if you find it more important, less important than the phone records. This knife sheath that was found at the scene laying on the bed next to one of the victims and investigators say that DNA testing linked the sheath to DNA found in the trash at Kohberger's parents' home. So, essentially linking the sheath to Bryan Kohberger himself. That seems pretty important.

MCCABE: It is absolutely critical. It's by far the most important piece of evidence in this case so far. Even with -- assume you had all the phone records you have, puts him in the area, shows him moving back and forth likely between his residence and in the homicide scene on the night of the murders, none of that actually puts him in the house. That DNA puts him not just in the house, but in -- literally, in the bed where two victims were found. So, it's absolutely the most critical piece of evidence. It's possible that that DNA got placed on the button of the knife sheath before the homicide, maybe as he was picking up his things and preparing to go that night before he had put his gloves on. So again, it gives you a piece of DNA that you might not have otherwise collected from the crime scene if he was smart enough to wear gloves during the commission of the crime. So -- and then of course, it's the familial DNA recovered from the garbage in the Pennsylvania area by the -- by the parents' house that actually gives us a pretty good identification that the DNA belongs in fact to Kohberger.

BOLDUAN: Where or what do you think at the moment, there's so much to learn, of course, but is the most kind of biggest outstanding question that the defense could exploit to push back on some of this evidence that we've just laid out?

MCCABE: You know, what we know so far, which I'm sure it's far less than what the investigators know already presents a pretty damning case. The first hurdle as we've just been talking about is always putting the defendant at the scene of the crime. The DNA clearly does that. Then you have all that other supporting information about the vehicle, the vehicle on surveillance, the movement of his cell phone in the period before the homicide, and then of course, the absence of his cell phone pinging the towers during the homicide but then he shows up the next morning before the crime is even reported to the police. All that stuff is I think, very persuasive.

It's likely that the investigators have collected additional evidence after the arrest because they've executed search warrants at his residence, his parent's residence, and also in his car. I think the thing that we're looking for now is whether any of those search warrants, maybe on electronic devices or e-mail accounts, conclusively show us how and why he began targeting those poor people.

BOLDUAN: Yes. So much to learn. I really appreciate it. Now, we have a problem cause hearing that they have set the date for. I really appreciate it, Andy. Good to see you. Thank you.

MCCABE: Thanks.

BOLDUAN: So, we have new data showing inflation is slowing for a sixth-straight month. What does that mean for the Feds' next decision then on raising interest rates? A top White House economic adviser will be joining us next.

(COMMERCIAL BREAK)

[11:48:14]

BOLDUAN: President Biden today touting progress being made with the economy after this morning's release of an important measure of inflation showing that it is slowing for a sixth straight month. Let me bring in Matt Egan. He's looking at the numbers -- at the data kind of trying to work through again the complicated picture. Matt, what do you see?

MATT EGAN, CNN REPORTER: Well, Kate, there's no doubt about it. Inflation is cooling off. The Fed seems to be having some real success putting this fire out.

Consumer prices up six and a half percent year over year. That's not good. It's not healthy. But look, everything's relative. That is the lowest reading since the fall of 2021. Month over month prices dropped. We haven't seen that since the spring of 2020.

BOLDUAN: Right.

EGAN: That's a big deal. Let's look at where prices are cooling off the most. Gas prices down one and a half percent, that's huge. Used cars dropping significantly. Televisions also down. But listen, inflation is still hot in other places. Shelter, 7 percent more expensive. That's a big deal. That's a huge part of people's budgets.

BOLDUAN: Yes.

EGAN: Food at the grocery store, of course, is very high. And everyone's talking about these egg prices up 60 percent. The last time we saw that was in 1973 when Richard Nixon was in the White House.

BOLDUAN: Yes.

EGAN: Another reminder here, Kate, of how while yes, inflation is cooling off, it is still too early to declare victory just yet.

BOLDUAN: And it's still too early to say that the Fed isn't done with their work. That is for sure.

EGAN: Exactly. They still have a bit more work to do.

BOLDUAN: That's -- it's great to see you. Thank you so much, Matt.

EGAN: Thanks, Kate.

BOLDUAN: Let's get some more important perspective on this. Joining me right now is Brian Deese. He's the director of the White House National Economic Council. It's good to have you here, Brian, thank you so much. So, we keep hearing that one data point does not make a trend. We talk about that all the time, especially when it comes to the economy. But this now shows inflation has slowed for sixth straight months. Is this now a trend, and do you think this means the country can achieve a soft landing?

BRIAN DEESE, DIRECTOR, WHITE HOUSE NATIONAL ECONOMIC COUNCIL: Well, it's good news and it's certainly encouraging of the trends that we are hoping to see.

[11:50:04]

One thing about this data point, it gives us the end of the year. And as you say, you never want to put too much emphasis on one month, but let's look at the quarter, the fourth quarter of last year. We saw that headline inflation on an annualized basis was actually below 2 percent. 1.8 percent. And that -- a lot of that is gas prices. That's good news for American families saving about $180 a month for a typical two-car family. But if you strip out gas prices and food prices and look at that core inflation, in the fourth quarter, that was 3 percent. That's down from more than 11 percent at the beginning of 2022. So, we're seeing that kind of moderation that we want to see.

And importantly, we saw it in the context of a quarter where our labor market remains resilient.

BOLDUAN: Yes.

DEESE: We hit the lowest unemployment rate in 50 years in this country. And real wages, workers for real -- workers are seeing real wage increases. That's been true for the last six months as well. So, certainly encouraging. We have more work to do. I'm that's for sure.

But one of the important parts on the policy side is that some of the most important policy that we work to pass and enact last year, the biggest impact on that whether that's infrastructure, investment in manufacturing, or lowering the cost of energy and prescription drug prices, is going to kick in in the first half of 2023.

BOLDUAN: Brian, what is going on with the price of eggs? That's one thing that definitely is sticking out and has a lot of people talking.

DEESE: Yes. I'm glad you raised that because if you look at food inflation, actually, food inflation this month cooled overall, and was the lowest -- the smallest increase in a couple of years. Driving that was -- this issue of eggs, that's driven by an outbreak of the avian flu. And so, we have to deal with that. These things -- these things happen. And certainly, we want to take that seriously. Do what we can to try to bring the price of eggs down.

But the underlying food inflation is cooling. And so that's good news for people at the grocery store when they're looking outside of eggs. Eggs, we're going to have to work on. The avian flu is something that, you know --

BOLDUAN: Yes.

DEESE: We can't control but we need to work to address it. While looking at that overall basket of food, the kind of impact that people have at the grocery store. The good news is that compared to six months ago, gas prices are way down and the increases that people are seeing in the grocery store are coming down as well.

BOLDUAN: Real quick, and I know you don't like to guess what the Fed is going to do or suggest what the Fed should do but this is the last CPI report before the Fed's next interest rate decision. Do you think the Fed is almost done raising interest rates?

DEESE: Yes, I do. Well, as you anticipated the -- their independence, and I will neither guess nor suggest what they're going to do. I will just say that, from our perspective, the president has been talking about what we are hoping to see. He talks about it as a transition to more steady stable growth. And that involves inflation coming down while seeing an ongoing resilience for American consumers and in the labor market as well.

Certainly, the data for the last quarter of the last year, the data that we've seen just over the course of the last couple of months is encouraging in that respect, it's going to redouble our resolve on fiscal policy, our resolved on implementing these measures to keep bringing prices down. But importantly, keep the drivers of long-term growth that we know are so important for this economy, investment in R&D and innovation, infrastructure, bringing jobs here to the United States. We are now in a position where we can derive that long-term economic benefit to position our economy to be better and more competitive in the future as well.

BOLDUAN: Brian, before you go, the White House Counsel revealed today and confirmed that more classified documents were found at the president's home in Wilmington, Delaware. This may not and very clearly, is not an area where you are focused on or written on or your area of expertise. But any big thing that happens within a White House impacts how the White House operates and can impact how -- you can impact a lot of things at the White House. As this continues to develop, is this becoming a distraction from the work that you're trying to do?

DEESE: Absolutely not. The president spoke to this issue. The White House Counsel spoke to this issue. Our focus, the economic team's focus is going to be on continuing this progress that we've made. And today's a good news -- good positive development on the economic side, but we'll increase our resolve to do the work we need to do on behalf of the American people to bring those prices down, keep this economic recovery going, that will remain our focus.

BOLDUAN: Appreciate your time, Brian. Thank you very much.

DEESE: All right.

BOLDUAN: All right. So, as we were just discussing, I was just asking Brian about the White House did confirm today that a second batch of classified documents were found at President Biden home -- Biden's home in Wilmington, Delaware. And we also heard how speaker Kevin McCarthy this hour speaking up and calling for a congressional probe into that matter. And while not disclosing the subject, Attorney General Merrick Garland will be making a statement at the Justice Department at 1:15 p.m. Eastern time this afternoon.

Joining me right now to talk about this and also some real developments in Ukraine is a top Democrat on the House Armed Services Committee, Congressman Adam Smith. It's good to see you, Congressman. Thank you for being here.

So, you now have this new information from the White House, the second batch of classified government records, not where they should, be not handled as they should. And although Biden and Trump appear to be handling the discovery of documents differently, there are obvious echoes here of the Trump investigation. You deal in classified information. What's your reaction to what you're learning from President Biden?

[11:55:12]

REP. ADAM SMITH, (D-WA): Well, there's two things. I mean, first of all, both the documents that were discovered at Mar-a-Lago and the documents that have been discovered in the two places with President Biden need to be investigated. The Justice Department needs to look and see how did they get there, who brought them there, what was the purpose, was it inadvertent, was it intentional? Absolutely, we need to look at both of these situations.

But there's one very big distinction here. When President Biden's team found these documents in the two locations, they voluntarily immediately turn them over to the appropriate authorities. President Trump took the position that he didn't have to. He took the position that he was basically above the law. He wanted to keep the documents and so, he would.

And the Justice Department and others negotiated with him for well over a year to try and get him to do what President Biden did, immediately turn the documents back over to the appropriate authorities, and he refused to do that so they executed a search warrant. So that is the very large difference between these two situations. But both are serious and both need to be investigated.

BOLDUAN: Do you think a special counsel should be appointed with this?

SMITH: I'm not sure on that. I think that might be helpful just to eliminate any sort of appearance of conflict since you know President Biden is still in office. You know, he has appointed the Attorney General on several key Justice Department people, you know to look at again, that the basic question of how did these documents wind up in a place where they shouldn't be?

That does need to be investigated. Those questions do need to be answered. And it is possible that a special counsel might be in the best position to do that. I think that would be perfectly fine.

I don't think Congress needs to launch an investigation on this, you know. We certainly didn't do that in President Trump's case. The Justice Department took care of it. And they should

BOLDUAN: I want to turn to Ukraine right now. The Russian government just announced that yet another -- just announced yet another change in commanders leading their war effort. This well-known general -- I believe you and I have discussed him before. Gerasimov will now be taking over command. The current commander of Russian forces becoming one of his deputies.

Military experts seem a bit perplexed at this. That this -- describing this as something of a mystery that is happening -- this move is happening in this moment. What do you think it indicates?

SMITH: I think it indicates desperation on behalf of President Putin and Russia. I mean, the invasion of Ukraine is not going the way they wanted it to. They are facing an embarrassing defeat. And President Putin is still unwilling to abandon his goal of basically eliminating a sovereign Ukraine. And that's the key to getting to peace here is to -- for Russia and Putin to realize they are not going to take over Ukraine, and to be willing actually to negotiate and end the conflict.

But Putin is flailing about, hoping that his initial dream of subjugating Ukraine once again to Russia, as it has been over the course of you know hundreds of years at one time or another. He clings to that and he's flailing about trying to figure out how to make it happen when it's clear that it won't. I think that's what it indicates right now.

BOLDUAN: You know defense spending has been a big topic over the last week as we're watching the speaker's fight play out and the negotiations going on behind the scenes. We don't know the full picture of how the new House speaker and his conference were planning to operate, but there are promises of budget cuts. He was speaking about it in this first press conference today. Some of the discussion has also been that they could include cuts to defense spending. Where do you think this is headed? Are you worried?

SMITH: Yes, I am worried. There's two things. One, we should have a robust discussion about the fiscal health of this country. You know we are borrowing a large amount of money. There's economists who will argue that that's OK, that we can make it work. And we have, for quite some time. But we should have a discussion about how much money will be spent in the budget.

Now, that should be a whole discussion. You know we're only talking about the discretionary portion of the budget, which is 1.7 trillion out of a more than $6 trillion budget. You know, it's the whole budget. And then also revenue matters, you know. How much taxes are you bringing in in order to pay for all this? So, we should have that whole discussion.

The real worry, however, is the approach that the radical MAGA extremists in the Republican conference want to take and the McCarthy is willing to go along with, which is to shut down the government, to not pass any appropriations bills, to not pass a CR, and to not raise the debt ceiling, putting us into a real fiscal crisis. That we should not do. And I am very worried that that is exactly what Speaker McCarthy is going to allow to happen over the course of the next 10 to 11 months. We should have a debate about the fiscal policy. Absolutely. We shouldn't be shutting down the government or refusing to pay our debts.

BOLDUAN: Yes. Mr. -- I was about to call you Mr. Chairman again, it's a transition for me as well.

SMITH: It's OK.

[12:00:01]

BOLDUAN: Congressman, thank you so much for coming out. I really appreciate -- I really appreciate your time as always.

SMITH: Thank you, Kate. I appreciate it.

BOLDUAN: Thank you. And thank you all so much for watching as always, AT THIS HOUR, I'm Kate Bolduan. "INSIDE POLITICS" with John King begins right now.