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The Lead with Jake Tapper

Inflation Surges By 9.1 Percent, Highest Level In 40+ Years; President Biden Begins Historic Middle East Trip; President Biden To Tackle Israeli-Palestinian Relations During Historic Trip; Uvalde Families, Officials Furious Over Leaked Surveillance Video; Russians Apparently Strike Ukrainian Elementary School; Starbucks To Close 16 Stores, Citing Safety Concerns. Aired 4-5p ET

Aired July 13, 2022 - 16:00   ET

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

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THE LEAD WITH JAKE TAPPER starts right now.

JAKE TAPPER, CNN HOST: It has been more than 40 years since inflation was this bad -- 40 years.

THE LEAD starts right now.

Food, gas, rent, electricity, all seeing stunning price increases. Families forced to choose between buying groceries or having enough gas to get to work. The pain is real and the jaw-dropping numbers today prove it.

Then, the families in Uvalde, Texas, understandably furious and frustrated that they did not get to see the hallway surveillance video before the rest of the world did. And even more so, about the 77 minutes of inaction that the video shows.

Plus, in some big cities, there will no longer be a Starbucks on every corner. The coffee giant is closing several locations but not because of slow sales. So, is this about working safety or is it about unionization?

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TAPPER: Welcome to THE LEAD. I'm Jake Tapper. We start today with our money lead and horrible news for your wallet.

New data today released by the Biden administration shows inflation surging to 9.1 percent. That is the highest level in more than 40 years and it means the prices we pay over all are 9.1 percent higher than they were this time last year.

So, unless you have benefitted from an unlikely 10 percent raise since then, you now have less money in your pocket than you did a year ago. Much of the increase is driven by gas prices, which we should note have fallen in recent weeks, but they remain insanely high, up nearly 60 percent in this report, and the increases are felt across a range of categories, prices on groceries are up more than 10 percent. Housing nearly 6 percent.

Today, President Biden admitting that inflation is still, quote, unacceptable high. Vice President Harris saying there is no question we still have work to do. Little consolation to the millions of Americans who are struggling to make ends meet due to rising prices across the board.

If you're looking for any good news in today's consumer price index report, well, Jason Furman, a former Obama White House top economic adviser tweet tweeted: There is absolutely nothing good in this CPI report.

Let's get straight to CNN business reporter Rahel Solomon.

Rahel, we just went through a few areas where prices have soared -- gas, groceries, housing. What other ways is this affecting Americans?

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Well, Jake, it was an eye- popping figure, much more hot than a lot of economists were expecting. But you don't have to look far to see all of the ways inflation is impacting Americans from energy prices, higher by more than 41 percent compared to a year ago, household cleaning products, more than 11 percent, apparel and prescription drugs, when you head to the grocery store, you can't miss it there either.

So, on average, food prices are about 4.1 percent higher, as you pointed out, Jake. But then take a look under the hood of that and you can see cereal and bread, higher by almost 14 percent, dairy, 13.5 percent, and eggs, a shocking 33 percent. So it is inescapable in this report, as Jason Furman points it out. It was an ugly report, a very hard to find any silver linings here.

And even though this expectation and even though this report was higher than expectations, it is perhaps no surprise to Americans who know and have been feeling inflation is painfully high right now.

TAPPER: And, Rahel, we noted that much of the increase was driven by gas prices. We have seen those prices starting to fall. Where do we stand now?

SOLOMON: Yeah, so crude prices and gas prices have been falling since about mid-June, and that has largely been continuing. So when we look at the price of a gallon of gas about a month ago, a record at about $5 a gallon. Today, looking a lot better, $4.63. And by the way, Jake, seeing lots of forecasts and expectations that that could go even lower.

So, that, of course, provides relief for Americans at the pump on the front end. But there is also some hope that if we continue to see declines in gas prices, that could provide some relief on the back end in the sense that companies and businesses when they see lower fuel prices that hopefully reduces their costs and they hopefully pass on those cost savings to us as American consumers. And so, there's hope if we continue to see declines, hopefully that helps on the inflation front.

TAPPER: Are there any signs that this is the peak of inflation and that we will start soon seeing prices fall?

SOLOMON: Well, it is really hard to find some silver linings. I actually talked to Mark Zandi, the chief economist at Moody's earlier because he's been one of the more optimistic economists in terms of whether we avoid a recession. He pointed me to core CPI, core inflation, essentially being inflation that strips away more volatile categories like energy and food.

And that did appear to peak in March. We have seen core inflation start to decline actually since March, so you have to look hard for a silver lining, Jake, but if there is one, that would be what it is and the hope is if we continue to see gas prices fall, we could see that continue to fall in the months ahead. Here's hoping.

TAPPER: All right. Rahel Solomon, thank you so much.

The soaring prices are forcing some Americans to have to make some really brutal decisions, including digging into their savings just to get by. One California resident telling CNN that if she wants to eat, she cannot afford to drive her car. She has to choose.

CNN's Gabe Cohen takes a closer look at the real world impacts of these record inflation numbers.

(BEGIN VIDEOTAPE)

ROSITA KLEIN (ph), CONSUMER: It's huge. It's every week.

GABE COHEN, CNN CORRESPONDENT (voice-over): Rosita Klein (ph) now searches several grocery stores for the cheapest options, on inflation adjustment, as her husband battles Parkinson's, making these price hikes far more painful.

KLEIN: We are using our savings.

COHEN: Are you nervous about the future?

KLEIN: Yes, of course.

COHEN: Inflation in America surged in June, with some of the steepest price hikes from June of last year in places like Baltimore, Miami, Atlanta, Phoenix, and Alaska. The biggest drivers, gasoline, up 60 percent in a year, and groceries,

up 12 percent. Plus, the largest monthly rise in rent since 1986.

All of those price hikes are straining Karen Martin, a 911 operator near Tampa, Florida, and a single mom raising two sons while making less than 20 bucks an hour.

KAREN MARTIN, TAMPA, FLORIDA SINGLE MOM: I'm not making ends meet. I'm spending my savings. I get paid tomorrow and already my whole paycheck is spoken for, and it's the first time in my life I had to apply for food stamps because I don't know how we're going to continue eating groceries.

COHEN: Consumer sentiment hit a record low last month as new polling shows 42 percent of Americans are struggling to remain where they are financially, nearly double from a year ago. And even 5 percent think the economy is getting worse.

UNIDENTIFIED MALE: Especially after COVID, nobody has money for anything, and now everything goes up higher and higher.

COHEN: It's forcing families to make brutal decisions.

UNIDENTIFIED FEMALE: It's like do you want to eat or drive?

COHEN: Some foregoing bills or medications. Many others turning to assistance programs like food banks.

AMANDA MCCARTHY, EXECUTIVE DIRECTOR, RIVER CITY FOOD BANK: We have seen skyrocketing numbers of people needing food. And unfortunately, we're not getting the same level in donations that we used to.

BONNITA WESLEY, VIRGINIA RESIDENT: I try not to let it get to me. You know, I just go day by day.

COHEN: On top of brutal price hikes, Bonnita Wesley expects to face a sizable rent hike in the months ahead.

Would you be able to afford to stay?

WESLEY: No, oh, no. No indeed. Not at all. I probably will have to move in with my kids or whatever. But no, not by myself, no.

(END VIDEOTAPE)

COHEN (on camera): And, Jake, by one estimate, the typical American household is now spending nearly $500 more every month on the same goods and services. So even as gas prices dip, families are still eating so many surging costs, and many of them are telling me their salaries just aren't keeping up -- Jake.

TAPPER: Gabe Cohen, thanks so much.

Joining us to discuss is Cecilia Rouse. She's the chair of the White House Council of Economic Advisers.

Cecilia, thanks so much for joining us.

I want to ask you about what we heard in Gabe's price, quote, what do you want, to eat or drive, unquote? That's the dilemma facing many Americans right now. What do you say to them?

CECILIA ROUSE, CHAIRWOMAN, COUNCIL OF ECONOMIC ADVISERS: I say, look, there's no question that inflation is the number one economic challenge we're facing in this country right now. That is why combating inflation is the president's number one priority.

So here's what I would say. One is as you noted in the piece, these data are somewhat backward looking. They represent the month of June and times when prices are more stable, June tells us about July.

In this case, we know for example gasoline prices have come down almost 40 cents since the peak in June. We know some other food commodities have come down, wheat, corn. So we know there have been some changes that will be welcome for the month of July, but that doesn't take away from the fact that price levels are unacceptably high.

The president has -- he's focused on a couple things. One is in terms of gas prices and energy prices, he is working to do what he can. It is why we need to get more oil product on the market.

It's why he has authorized the historic release from the strategic petroleum reserve. There's a million barrels a day that are going into the market, working with partners and allies to insure that is making a small difference. It's not going to solve the problem, but it is making a difference in terms of gasoline prices.

Two, he's in the Middle East. He recognizes that we need to insure that we have a global supply of oil.

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And so, he's working with partners and allies. He welcomes OPEC Plus's decision to increase supplies.

TAPPER: Yeah.

ROUSE: He has waived the ethanol 15 regulations in order to have more oil available at more reasonable prices. He's calling on the Congress to waive and to put a gas tax holiday on, and calling on states to do the same.

TAPPER: So that's, as you acknowledge also, while he's trying to do all that with gas and gas prices are down about 40 cents per gallon in the last month, that does not address the fact that groceries and rent are skyrocketing.

ROUSE: Absolutely. You know, let's talk about rent, which was definitely reflected in today's CPI number. In the short term, the president is giving the Federal Reserve the space it needs to do what it needs to do to control inflation. The Federal Reserve has the dual mandate of controlling prices while

maintaining maximum employment. It's doing what it needs to do. Other presidents have tried to intervene in the Fed's actions as president has said they're independent. He respects what they need to do, and part of what the Federal Reserve's actions will do and we're already seeing it is, is to cool off the housing market, which will find its way into helping with rent.

But let's face it, we have a housing shortage in this country. It goes back a decade. And that's why over the medium term and longer term, this president has a plan to increase housing supply in this country because we know how very important it is to insure that everybody has a place to live.

TAPPER: Right. So let me just ask you, because you're talking about a possible solution to this. The chairman of the Export/Import Bank under President Obama, Fred Hochberg, he wrote an op-ed in "The Wall Street Journal," and he notes that ending Trump's tariffs on Chinese goods by some estimates could help U.S. households to the tune of $1,000 a year.

Is there any reason the Trump tariffs on Chinese goods are still in place other than the fact that Biden supporting labor unions like those tariffs?

ROUSE: So, there's a variety of estimates as to what the impact of rolling back the tariffs would have on the price levels. And we understand it would have at least a modest effect on price levels.

But the president is reviewing the tariffs. It is complicated. It's part of our relationship with China is part of a geopolitical decision making, but it is part of the tools that the president is considering deploying at this time.

TAPPER: I just feel like every month, one of you nice people from the White House comes on the show to talk about inflation, and you talk about these tools in the president's tool kit and you don't use them. You don't use these tools.

And you know, there's debating and discussing going on, and meanwhile, prices are still going up.

ROUSE: Look, the president right now is in the Middle East because he wants to try to get as much oil on the market as possible. That is the way that we bring down prices. Oil is set on a global scale.

We also recognize that the distance between oil production prices and what people pay at the pump is refining. He's talking to refiners, trying to insure they're prepared for the hurricane season so we keep as much refined product on the market as possible.

The energy prices are seeping into other goods as well. We understand that.

So this is a great time to talk about the rest of the president's economic plans. TAPPER: Right.

ROUSE: He wants to work with Congress to reduce prescription prices. Utility costs, health care costs. He wants to lower the deficit, which we know also addresses inflation. He wants to do so by increasing taxes on the wealthiest individuals and corporations.

He needs Congress to do so, he wants to insure we're making chips here at home. Part of the price increases is the lack of supply of cars and that goes back to our semiconductor chip.

So, you know, Congress needs -- we're open and willing. It's a great time for Congress to act on these important economic initiatives.

TAPPER: He's the Democratic president and the Congress is controlled by Democrats. So, it's not as though you guys don't have each other's phone numbers.

Listen, CNN's Kaitlan Collins asked President Biden about inflation on December 10th. It's July now. On December 10th, and President Biden told her then that he thought December 10th was the peak of the crisis. Take a listen.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: And I think you'll see a change sooner, quicker, more rapidly than it will take than most people think. Every other aspect of the economy is racing ahead. It's doing incredibly well.

(END VIDEO CLIP)

TAPPER: Obviously, the war in Ukraine has happened since then, which is partially to blame for higher gas prices, although Putin's forces were on the border right then. But it just seems clear that the Biden administration has misjudged how bad inflation was going to get, for months and months and months.

ROUSE: So, look, there is no question that the war in Ukraine exacerbated the inflation challenge.

[16:15:04]

In fact, you can go back to when Putin had troops on the border and since that time, about 90 percent of the difference between headline CPI and core CPI can be attributed since -- that has widened since the war began.

The inflation we're seeing is due to the pandemic and is due to the war. And we're not done with this pandemic. We're now seeing that there -- China is under threat of lockdown again. While we have made great progress on many aspects of the explain supply chain, we're not done with this pandemic.

So, the Federal Reserve has the primary responsibility of generating price stability and maximum employment. They're starting to make movements. We're starting to see their changes, their policy movements are trying -- are seeping into the economy. We're seeing nominal wage increases are moderating. We're seeing a little bit of moderation in consumer spending.

And so, their processes are in motion. We have full faith and confidence that over the coming months that inflation will be coming down.

I don't have a crystal ball. I'm not going to tell you exactly when, the timing. The war in Ukraine is a big unknown.

But I can tell you this, we came into these challenges with record growth over last year. We still have a labor market that is very strong. And household balance sheets, I understand that they are being tapped, but they're stronger than they have typically been going into this type of rate hike period.

So, yes, we face challenges but we also come at it from a position of relative strength.

TAPPER: Cecilia Rouse, thank you so much. Appreciate it.

Growing questions about a President Biden handshake slip-up in Israel. Was it a slip-up?

Then, is there trouble brewing at Starbucks? Why the coffee giant is shutting down some of its stores in several big cities.

Stay with us.

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TAPPER: In our world lead, a fist-bump instead of a handshake. That was the greeting President Biden gave the Israeli president moments after stepping off Air Force One earlier today. The White House said that was part of an effort to reduce physical contact due to the new COVID variant ripping throughout the world.

And yet, the famously hands-on President Biden who calls himself tactile, obviously, has difficulty abiding by this new protocol. Minutes later, shaking hands with the former Israeli Prime Minister Benjamin Netanyahu, and later in the day in an emotional and moving moment, clasping the hands of a pair of Holocaust survivors at Yad Vashem.

CNN's Kaitlan Collins is in Jerusalem where she tracked President Biden's first full day in Israel and an agenda focused on oil and regional security.

(BEGIN VIDEOTAPE)

KAITLAN COLLINS, CNN CHIEF WHITE HOUSE CORRESPONDENT (voice-over): President Biden touching down in Israel for a four-day swing through the Middle East. BIDEN: The connection between the Israeli people and the American

people is bone deep. It's bone deep.

COLLINS: Nearly 50 years after first visiting Israel as a new senator, Biden's first stop as president is focused on oil and security.

BIDEN: Every chance to return to this great country with the ancient roots of the Jewish people date back to biblical times is a blessing.

COLLINS: Biden greeted by Israeli leaders before getting a briefing on Israel's Iron Dome defense system and making a solemn trip to Yad Vashem, where he clasped the hands of Holocaust survivors.

The president received a warm welcome, but thornier issues lie ahead for his trip.

BIDEN: We'll discuss my continued support, even though I know it's not in the near term, a two-state solution.

COLLINS: Biden reiterating his support for a two-state solution during a visit also aimed at slowing down Iran's nuclear program.

BIDEN: I think it was a gigantic mistake for the last president to get out of the deal. They're closer to a nuclear weapon now than they were before.

COLLINS: Biden's visit so tightly choreographed that officials citing COVID-19 indicated he had dubbed it a no-handshake policy ahead of a contentious stop in Saudi Arabia. But Biden quickly returned to glad handing, laying the groundwork for an awkward greeting with the Saudi crown prince accused of sanctioning the murder of dissidents.

Will the president be photographed shaking hands with the crown prince or meeting with him while in Saudi?

JAKE SULLIVAN, NATIONAL SECURITY ADVISER: The president will have the opportunity to have a bilateral program that will involve the king, the crown prince. In terms of the precise modalities, I'll leave that to the folks who are organizing the trip.

(END VIDEOTAPE)

COLLINS (on camera): And, Jake, during the president's interview with Channel 12 here in Israel, he was asked about that gap of what he views Israel as and what some of the more progressive members of the Democratic Party do. He answered. He said there are a few people who think that.

He said, quote, I think they're wrong. I think they're making a mistake. He called Israel a democracy and an ally of the United States and he said he makes no apologies for his position on that front, Jake.

TAPPER: All right. Kaitlan Collins, thanks. Another big question during President Biden's big trip, how will he

acknowledge the Palestinian community? Many Palestinians expressed relief when Biden won the White House over Trump.

But as CNN's Hadas Gold reports, almost a year and a half into Biden's presidency, many Palestinians say they see little results.

(BEGIN VIDEOTAPE)

HADAS GOLD, CNN CORRESPONDENT (voice-over): Five years ago, on his last visit to the White House, the Palestinian Authority President Mahmoud Abbas made a rare venture into English.

MAHMOUD ABBAS, PALESTINIAN AUTHORITY: Now, Mr. President, with you, we have hope.

GOLD: Several months later, that hope proved to have been terribly misplaced.

TRUMP: It is time to officially recognize Jerusalem as the capital of Israel.

GOLD: Under Donald Trump, U.S. policy tilted heavily towards Israel. The Palestinian political office in Washington was closed. The American consulate in Jerusalem, which symbolized U.S./Palestinian relations, also closed, and almost all economic aid to the Palestinians was switched off.

So when Joe Biden won the election, there was great relief among many in the Palestinian community. But that relief has little to show in terms of action. The Biden administration highlights renewed financing. About half a billion dollars, mostly on schools, hospitals, and other humanitarian aid projects. Further, $100 million is set to be announced on this trip including some money for Palestinian hospitals in East Jerusalem.

[16:25:04]

But politically, the White House seems unwilling to pressure Israel over continued expansion of West Bank settlements and weak in the face of Israel's resistance over plans to reopen the consulate in Jerusalem.

Hussein Sheikh is one of Abbas' closest aides.

HUSSEIN SHEIKH, SECRETARY GENERAL, PLO EXECUTIVE COMMITTEE: The U.S. administration has been talking with us about these issues for more than a year, but nothing has been achieved. Even so, we continue to hope this visit will produce serious outcomes that it provides hope and a political horizon.

GOLD: Biden's visit to the West Bank will take him not to Ramallah, the headquarters of the Palestinian Authority, but to Bethlehem, just a few miles south of Jerusalem, where the president will find it hard to avoid stark reminders of the conflict. One issue that will likely be staring President Biden right in the

face, the killing of Shireen Abu Akleh, this giant mural of the al Jazeera journalist is right on the road you take as you enter Bethlehem.

For many here, the U.S. response to the death of the Palestinian American reporter shot dead while covering an Israeli military operation has been inadequate and indicative, they believe, of the U.S.'s unwillingness to force Israel to get serious about peace and bringing an end to occupation.

LINA ABA AKLEH, NIECE OF SHIREEN ABU AKLEH: Putting an end to this injustice, an end to this impunity is important because it sheds light, it continues to shed light on the greater picture of what Palestinians continue to endure on a daily basis.

GOLD: From the Palestinian perspective, the overwhelming feeling around the president's visit is one of pessimism.

(END VIDEOTAPE)

GOLD (on camera): And, Jake, while Israel has already offered certain confidence-building measures such as increasing the work permits for Palestinians from Gaza to be able to work in Israel or increasing building permits. On the ground, Palestinians you talk to say they don't expect much. One Palestinian tour guide I spoke to said the only real difference he thinks he will feel in his life after this visit is that the roads in Bethlehem will be paved for Biden's motorcade -- Jake.

TAPPER: Hadas Gold, thank you so much for that report.

Seven weeks, that's how long it's been since that gunman murdered 19 children and 2 teachers at the Uvalde elementary school, and now the world is getting to see the police inaction. Why aren't the families getting answers?

Stay with us.

(COMMERCIAL BREAK)

[16:31:47]

TAPPER: In our national lead now, outrage, understandable outrage over the leak of the disturbing hallway surveillance video from the May 24 Uvalde school massacre where 19 children and 2 teachers were murdered. "The Austin-American Statesman" newspaper is defending its decision to obtain and publish a 4-minute edited video, and later the 77-minute video.

And while many victims' families are feeling blindsided by not being able to see the video before the rest of the world was able, questions persist seven weeks after the tragedy as to why officials waited this long to show them the video, not to mention the weeks of inaccurate or scarce information about the delayed response by police on that horrific day. Let's bring in CNN's Shimon Prokupecz.

Shimon, what are the victims' families telling you?

SHIMON PROKUPECZ, CNN CRIME AND JUSTICE CORRESPONDENT: Well, they're frustrated. And Jake, that frustration continues. They were completely blindsided by the release of this video. You know, this video is so disturbing to watch, specifically in the beginning, in the first moments of when this shooting takes place, when you see officers running in. They're going, there's gunfire at that moment. They are going towards the gunfire, but then they stop and they retreat, and then the officers just never gain momentum again.

Families so angry over the release of this video, take a listen to what one of the family members had to say.

(BEGIN VIDEO CLIP)

ADRIAN ALONZO, UNCLE OF ELLIE GARCIA, UVALDE VICTIM: It's been up to this point where it's been almost radio silence from the investigation. There's been nothing coming out, nothing new, nothing that we don't know. They told us that the video would be shown to family on Sunday and released to the public, yet we logon Facebook and it's there for the whole world to see before we even saw it.

(END VIDEO CLIP)

PROKUPECZ: And that's the thing, Jake. The family members, they did want this video released. They did want to see it. They wanted to do it together. In an organized fashion, have counselors there, clergy members there. They were bracing themselves for this, for Sunday, and certainly to see it come out in this way has really, really upset them, Jake.

TAPPER: Shimon, the Texas House Committee was planning to show the entire video to the families on Sunday, as the gentleman noted. Are there plans to move it up or cancel it now that the video has been published?

PROKUPECZ: No, they say they are still expecting to have family members there on Sunday in Uvalde where they're going to show it to them. I think they're going to get some tougher questions now as to how this happened because members of the community and these families feel so betrayed. They have no trust in the system after being lied to and really what they feel is that they have been disrespected. Certainly, they're going to have a lot more questions for those officials present there.

TAPPER: Shimon Prokupecz, thanks so much.

An elementary school hit not once but twice by Russian rockets. We're going to go live to Ukraine next. Stay with us.

(COMMERCIAL BREAK)

[16:38:53] TAPPER: In our world lead, Russia is ramping up its assault on cities and civilian targets, the entire Donbas region. The death toll has risen to 47 following a Russian rocket strike on a five-story apartment building in the Donetsk region of eastern Ukraine. Authorities say the search and rescue operation is still ongoing in what they're calling one of the largest losses of life during this Russian invasion.

CNN's Ivan Watson reports now from the ruins of an elementary school hit by a Russian rocket, an act the governor of the region is calling an act of terrorism.

(BEGIN VIDEOTAPE)

IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: This used to be a classroom in school number 60 in the southern Ukrainian city of Mykolaiv, that is until before dawn on Tuesday when what appears to be a Russian rocket slammed into the building. Nobody was hurt thankfully perhaps due to the time of day, its summer vacation right now, but look what's left.

The principal says this school was constructed more than 100 years ago. It's completely devastated now.

And the Ukrainian authorities here, they say the same morning the city was hit by nearly two dozen other impacts, including a hospital, which just goes to show that nothing and nobody really is safe in this conflict zone.

VITALIY KIM, GOVERNOR, MYKOLAIV OBLAST: This is terrorism and that's it. Because this is like a strategy of Russian to scare civilian people to make panic.

WATSON: What is your message to your own residents when a school can be blown up like this?

KIM: Once again, it was better than it was.

WATSON: The fighting is intensifying. Ukrainian forces have succeeded in pushing back Russian troops in some areas, and Ukrainians also claim to have carried out some strikes deep behind Russian front lines destroying what they claim are ammunition depots and even a Russian military officer's position.

The Ukrainian government is urging residents of the nearby Russian occupied city of Kherson to evacuate if they can. They are anticipating even more fighting in the near future.

In the meantime, the Russian military continues to lob back long-range munitions at places like Mykolaiv. And I want to show you this, the teachers say that some other kind of Russian artillery hit the courtyard of this school back in early April, spraying the walls of the nearby gymnasium with shrapnel.

So, this school has been hit twice since the Russians invaded Ukraine in February of this year, and with Mykolaiv, this city so close to the front lines, things could get much worse here in the near future.

(END VIDEOTAPE)

WATSON (on camera): Now, Jake, amid all the suffering and uncertainty here, there may be a ray of hope. That is in the words of the United Nations Secretary General Antonio Guterres, after Turkey hosted a meeting attended by delegations, military delegations for both Ukraine and Russia, as well as the United Nations. And the Turkish government has announced that there was a basic agreement reached by these warring parties at this meeting in Istanbul, which was aimed at finding a way to open corridors for Ukrainian grain to be exporting.

Now, Ukraine is one of the world's biggest producers of wheat. And since the war, since the Russian invasion, almost all of the seaborne transit and travel has been blocked along Ukraine's coast by the Russian navy, by sea mines. There appears to be the beginning of an agreement to get some of this grain out. The shortage is driving a global food crisis, raising prices that are hitting the world's poorest countries the hardest -- Jake.

TAPPER: All right. Ivan Watson in Odesa, Ukraine, thanks so much.

Turning to our buried lead, that's what we call stories we don't think are getting enough attention, bipartisan legislation to give veterans access to care after their exposure to toxic burn pits, that legislation which we have been covering for years now, it was supposed to be on President Biden's desk by last week. But it hit a snag.

Burn pits were used to dispose of trash, hazardous materials, and human waste at military sites throughout Iraq and Afghanistan, until about 2010. Today, there is some progress on that legislation in Congress. In a few hours, the House is expected to vote on a fix for the issue.

Joining us to explain, Democratic Congresswoman Elissa Slotkin of Michigan.

Congresswoman, this was supposed to be a done deal by July 4th. So, what's the problem? What's the holdup?

REP. ELISSA SLOTKIN (D-MI): Yeah, to be honest with you, the Senate passed almost the exact version of this bill in a very, very bipartisan way, just a couple weeks ago. But they had sort of a technical error that they needed to fix. They fixed it. We're now voting on this in the House today again, and I think it will shortly go to the president's desk.

It wasn't malicious. It wasn't a fight. It was just a technical error, but it's really landmark legislation, particularly for the 9/11 generation of veterans. It's basically some of the biggest stuff we have seen for veteran health care in the past 30 years. And it's basically saying if you live near one of these burn pits, as everyone did if you served in Iraq and Afghanistan, Somalia, that you might be at greater risk for some specific maladies, some cancers, and the V.A. needs to recognize that exposure, that toxic exposure and get you the tests and care you need. So it's a big deal. TAPPER: In late June, the Senate version of the bill was blocked

temporarily by Republican Senator Pat Toomey of Pennsylvania. He said he opposed the measure because it cost too much money. Take a listen.

(BEGIN VIDEO CLIP)

[16:45:01]

SEN. PAT TOOMEY (R-PA): So about this budgetary gimmick that's designed to allow hundreds of billions of dollars of additional spending on totally unrelated, who knows what categories. We have inflation hitting a 40-year high. We have a government that's been spending trillions of dollars, too much money, printing the money to spend, and everybody sees it every day at the pump, at the grocery store, everywhere, and what this gimmick does is it makes it possible to spend yet another $400 billion.

(END VIDEO CLIP)

TAPPER: My understanding is that Senator Toomey cannot stop the bill from passing once it gets to the Senate this time. But what do you make of his comments and his call for congressional oversight over how the money is spent?

SLOTKIN: Yeah. It's interesting. To me, because these bills have passed by such a bipartisan margin, large margin, it's been interesting to watch the divisions between folks in different parties and the economic argument has been thrown out in the House as well, as recently as today, I was on the floor negotiating and debating this bill.

And the truth is, I think it comes down to whether you factor in health care for our veterans as the cost of sending theme war, right? When we send something into a combat zone, I believe we have a solemn responsibility to take care of them and their injuries suffered in that service.

So while everyone is entitled to their opinion, it always surprises me when people pop their heads up and have concerns about spending around our veterans because I think it's participate of our moral responsibility.

TAPPER: Democratic Congresswoman Elissa Slotkin from Michigan, thanks so much for joining us. Really appreciate you bring us up to date on an important legislation.

SLOTKIN: Thank you.

TAPPER: Turning to our politics lead, a sign of the changing times at the U.S. Capitol. A statue of several rights pioneer and educator Mary McLeod Bethune was unveiled today in statuary hall. Her statue representing the state of Florida replaces one of confederate General Edmund Kirby Smith. And good riddance.

It's also, as Florida Governor Ron DeSantis points out, the very first state-commissioned statue of a Black American to be put in statuary hall. Mary Bethune lived from 1875 to 1955. Her statue includes a mortarboard cap and gown because she's among other things the founder of a school for women, which is now Bethune-Cookman University in Daytona Beach.

We should note that sadly, states including Mississippi and Georgia and others still have statues of Confederate traitors honored in statuary hall. May be time to follow Florida's lead, folks.

Coming up, Starbucks says they're closing a bunch of stores because of worker safety, but is this about something more?

Stay with us.

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[16:52:05]

TAPPER: In our money lead now, keeping stores safe is too tall an order for some Starbucks locations. The company says it is closing 16 stores because of a high volume of challenging incidents. The locations being shuttered are in cities spread across the East and West Coast, including in union station here in Washington, D.C.

This all comes as the company looks to reinvent itself as workers continue to vote to unionize throughout the country.

CNN business correspondent Alison Kosik joins us live.

Alison, what is Starbucks saying about why these stores aren't safe?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Jake, Starbucks is saying it's closing those 16 locations because of a high volume of challenging incidents that are making it unsafe to operate at those locations.

We do see them going into a little more detail in a company letter that sent to its partners. Its partners are what it calls its employees. It says in part it's seeing its employees are seeing first- hand the challenges facing our communities -- personal safety, racism, lack of access to health care, a growing mental health crisis, rising drug use, and more.

It goes on to say, with stores in thousands of communities across the country, we know these challenges can at times play out within our stores, too. Starbucks does say that the move to permanently close these locations is part of a broader effort to revamp the company, something that was outlined in a second letter. This letter actually from the CEO, Howard Schultz, who rejoined the company in April.

And he alludes to Starbucks' future. He said today we find ourselves in a position where we must modernize and transform the Starbucks experience in our stores and re-create an environment that is relevant, welcoming, and safe, and where we uplift one another with dignity, respect, and kindness. Among the changes to help create a safer place to work, Starbucks will now give store managers the authority to limit seating in the cafes or even close restrooms if there are safety concerns. In 2016, Starbucks created an official policy allowing all guests to use cafes and restrooms where they made a purchase or not -- Jake.

TAPPER: Alison, this comes at the same time there is this big unionization push from many Starbucks employees. Is there any connection between these store closures and that push?

KOSIK: Well, you look at what's happening now, two of the 16 store locations that we're talking about, they're already unionized and being shut down. But Starbucks says the closures have nothing to do with the unionization. I did talk with one employee at a unionized Starbucks store who thinks differently. There was also a tweet from the union questioning whether the decision to close one of the unionized locations was made in good faith.

However, Starbucks has made it pretty clear it does not want employees to join the union and it won't guarantee benefits to those who do. If you look at the tally as of June 24th, 133 star bucks stores have been unionized. That encompasses about 3,400 hourly workers.

[16:55:00]

Elections are under way at dozens of additional locations as well. Even with that, unionized stores make up only a small fraction of Starbucks company-owned 9,000 stores -- Jake.

TAPPER: All right. Alison Kosik, thanks so much.

We're now learning what aspects of the January 6th Select Committee investigation the department of justice might be focusing on. That story is next.

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[16:59:45]

TAPPER: Welcome to THE LEAD. I'm Jake Tapper.

This hour, as the United States deals with the most contagious COVID variant to date, the Biden administration is pushing people to get a second booster shot, but how is that going to work if Americans under 50 are still not considered eligible for that fourth dose?