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The Lead with Jake Tapper
NY Attorney General Alleges "Staggering" Business Fraud In New Lawsuit; Russia Calls Up 300,000 Reservists To Bolster Failing Invasion; Biden At U.N.: Russia's War Should "Make Your Blood Run Cold"; Federal Reserve Raises Interest Rates By .75 Percent; Gov. DeSantis Facing Class Action Lawsuit From Migrants; Russians Release Two U.S. Fighters Captured In Ukraine. Aired 4-5p ET
Aired September 21, 2022 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:32]
JAKE TAPPER, CNN HOST: Maybe he is not the Teflon Don.
THE LEAD starts right now.
Fraud, lies and inflated financial values. A new lawsuit from the New York attorney general against Donald J. Trump and his adult children takes aim at their entire real estate empire, which she says is built on a foundation of fraudulent sand. How Trump's former lawyer Michael Cohen put this whole case in motion.
Plus, protests ignite in Moscow and beyond as Russians begin to revolt against Putin's war in Ukraine, the escalation by the Russian leader today, and President Biden's sharp response. So, what does the French president think, he'll be here live with his response.
And your money and the cost to borrow. A historic move by the Federal Reserve, raising interest rates yet again in an effort to get inflation under control.
(MUSIC)
TAPPER: And welcome to THE LEAD. I'm Jake Tapper. We start today on our politics lead. The extraordinary new legal trouble for former President Donald Trump.
New York Attorney General Letitia James, a Democrat, announced today her office has filed a sweeping lawsuit against Trump, three of his adult children, and the Trump Organization, alleging that they were involved in a decades-long financial scheme that allowed Trump to fraudulently inflate his network by billions of dollars, allowing him to leverage the system for his own personal gain at the expense of others.
(BEGIN VIDEO CLIP)
LETITIA JAMES, ATTORNEY GENERAL OF NEW YORK: White financial crime is not a victimless crime. When the well-connected break the law, to take in more money that they are entitled to, it reduces resources to working people, to regular people, the small businesses and to tax -- and all taxpayers.
(END VIDEO CLIP)
TAPPER: Attorney General James who campaigned on a promise of going after Donald Trump is seeking a minimum of a quarter billion dollars from the Trump Organization for what she says is more than 200 examples of false and misleading asset evaluations.
She's also asking a court to permanently bar Trump and Ivanka, Don Jr., and Eric, his three oldest children, from serving as business officers in the state of New York.
As CNN's Jessica Schneider reports for us now, even though these are civil and not criminal charges, the implications from this lawsuit for Trump and his business are potentially significant.
(BEGIN VIDEOTAPE)
JAMES: Claiming you have money that you do not have, does not amount to the art of the deal. It's the art of the steal.
JESSICA SCHNEIDER, CNN JUSTICE CORRESPONDENT (voice-over): New York's Attorney General Letitia James announcing she is suing former President Donald Trump and his three oldest children from lying to lenders and insurers for more than a decade, fraudulently inflating the value of their properties all over the country.
JAMES: They violated several state criminal laws, including falsifying business records, issuing false financial statements, insurance fraud, and engaging in a conspiracy to commit each of these state law violations.
SCHNEIDER: James is seeking drastic remedies, her lawsuit demands Trump and his family forfeit the nearly quarter million dollars they've illegally gained over the years, and she's looking to shut down Trump's business dealings in New York.
JAMES: We are asking the court to, among other things, permanently bar Mr. Trump, Donald Trump Jr., Ivanka Trump, Eric Trump, from serving as an officer or director in any corporation or similar entity registered and/or license in New York.
SCHNEIDER: New York's attorney general filed this 200 plus-page lawsuit after three-year-long investigation. James also flagging what she says are possible crimes to federal investigators.
JAMES: We are referring those criminal violations that we've uncovered to the United States attorney for the Southern District of New York and the Internal Revenue Service.
SCHNEIDER: James pointed to Trump's Fifth Avenue apartment as an example of fraud. Trump allegedly claimed it was 30,000 square feet, when it was actually 11,000. And he valued it at $327 million.
JAMES: To the state, no apartment in New York City has ever sold to close that amount. SCHNEIDER: James says the motive was to entice banks to loan them
more money, and to allow Trump and his companies to pay less in taxes.
SHAN WU, FORMER FEDERAL PROSECUTOR: Obviously, there's tax fraud going on here, given the massive inflation of these values.
[16:05:05]
SCHNEIDER: Trump has rebuffed James' investigation over the last three years.
DONALD TRUMP, FORMER PRESIDENT: My company is bigger, stronger, far greater assets --
SCHNEIDER: And he lashed out on his Truth Social page shortly after the lawsuit was filed, saying she is a fraud who campaigned on a "get Trump" platform. But James, a Democrat, running for reelection this year, saying Trump cannot dismiss as some sort of good faith mistake.
SCHNEIDER: White color financial crime is not a victimless crime. Every day people cannot lie to a bank and if they did, the government would throw the book at them. Why should this be any different?
(END VIDEOTAPE)
SCHNEIDER (on camera): And the New York attorney is also alleging that Trump and his three eldest children lied more than 200 times when it came to those asked said evaluations on statements over ten years.
Now, of course, this is a civil case that's been filed in New York state court. At this point, it's up to other entities like the Manhattan DA's office, or the U.S. attorney's office in Manhattan to determine whether or not criminal charges should be filed.
But, Jake, those officials at those offices declined to comment today.
TAPPER: All right. Jessica Schneider, thanks so much.
CNN's Kara Scannell is live for us outside of the New York Attorney General's office.
Kara, explain how Trump's former lawyer Michael Cohen set this all in motion?
KARA SCANNELL, CNN CORRESPONDENT: Well, Jake, this all goes back to 2018 when Michael Cohen pleaded guilty to nine federal crimes, including helping former President Donald Trump and what the authorities alleged was a campaign finance scheme.
Now, just before Cohen was reporting to prison in early 2019, he went before Congress and he made a number of allegations. He said the former president and his company had manipulated the values of their financial statements to obtain better loan rates, better insurance rates, and tax benefits.
Let's take a listen to what he told Congress. (BEGIN VIDEO CLIP)
REP. ALEXANDRIA OCASIO-CORTEZ (D-NY): To your knowledge, did the president ever provide inflated assets to an insurance company?
MICHAEL COHEN, FORMER TRUMP LAWYER: Yes.
OCASIO-CORTEZ: Who else knows that the president did this?
COHEN: Allen Weisselberg, Ron Liebermann, and Matthew Calamari.
OCASIO-CORTEZ: And where would the committee find more information on this? Do you think we need to review his financial statements and his tax returns in order to compare them?
COHEN: Yes, and you find them at the Trump Org.
(END VIDEO CLIP)
SCANNELL: That prompted the New York Attorney General's Office to fire off a number of subpoenas, including to the Trump Organization and some of its lenders. They also went on to interview more than 60 people, including the former president, his three adult children, the former president and his son Eric Trump declined to answer questions hundreds of times, Jake. But, this is -- this is what brought us to this moment today. The culmination of this investigation that Letitia James, the New York attorney general, had credited Michael Cohen with.
TAPPER: So, there's also this parallel criminal investigation being conducted by the district attorney of Manhattan, this is separate and distinct. What do we know about that probe?
SCANNELL: Right, so this investigation by the Manhattan district attorney office is parallel in nature. It has a lot of the same sorts of potential allegation. Now, in a criminal case, the burden of proof is much higher than in a civil case. And the Manhattan DA Alvin Bragg initially slowed down this investigation when he took over office earlier this year. According to sources, he didn't believe they had enough proof to prove that the former president intentionally was involved with the valuations on these properties.
Today, we got a strong statement from Bragg. He said: Our criminal investigation concerning former President Donald J. Trump, the Trump Organization and its leadership is active and ongoing -- Jake.
TAPPER: All right. Kara Scannell, thank you so much.
Let's bring in former U.S. Attorney Preet Bharara of the Southern District of New York, long with former Trump White House strategic communications director Alyssa Farah Griffin.
Preet, so, let's say there's a viewer out there who thinks, I mean, I've seen this movie before. Donald Trump does something illegal, improper, somebody says they're going to do something about it and he escapes -- what do you say to them? PREET BHARARA, CNN SENIOR LEGAL ANALYST: Well, this is a civil case.
So he's not going to go to prison based on the allegations on this very lengthy, detailed, sprawling with specific 220-page civil complaint. I think it's going to be very hard to wiggle out of this -- wiggle out of this, because the specificity of the allegations, because of all the evidence that they have.
You know, we've seen this before. He doesn't always escape liability. The Trump Foundation was also the target of the attorney general's office in New York, that was essentially shut down, and there was a debarment of Donald Trump and his children with respect to that case.
So, this does not mean prison, although we have that matter that we can talk about in a moment. But I think that his ability to do business, in the way that he was doing before based on these allegations is probably soon to come to an end.
TAPPER: There's also a civil penalty for the Trump University case as well, I guess. So, there sometimes has been recrimination.
BHARARA: Yes.
TAPPER: Not always.
Alyssa, so, obviously, we know Trump's playbook. He's blasting Letitia James, saying that she's racist, saying that -- and this part is accurate -- that she did campaign as someone who is going to hold Donald Trump accountable.
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We have seen some people who've been critical of Trump, like former Attorney General Barr, now criticize Letitia James in a suit.
Do you think it's political?
GRIFFIN: No, although I do think Donald Trump is going to share the video for campaigning on investigating him repeatedly. That's going to work with his supporters. What I saw, I'm not an attorney, that was laid out today, was a very credible case that she's making.
But taking a step back, it's been a really rough 72 hours for Donald Trump. So, in the case of the special master, where he did get this kind of small victory, he got what he wanted to be able to review the case, but then the special master comes out and says, yes, there's no evidence that something is declassified, then we're going to consider that you mishandled classified information.
He now has this old sexual assault alleged case that's coming forward again, too, under a statute of New York that they're able to revisit, and now this. I mean, listen, I'm more of a political person, I would just say this is a extraordinarily bad week for the former president. He is lashing out because it's getting closer to him and his family. It's a moment for my party to think, is this something do we even want to be associated with? TAPPER: Letitia James, Preet, says that she's referring potential
allegations of bank and tax related fraud in her civil case to the IRS and to the U.S. attorney's office for the Southern District of New York where you used to be the big honcho? How will that office look at this information? Do you think it's possible that he'll face criminal charges if what she's saying is accurate?
BHARARA: It's possible. It's very unusual in a civil complaint as opposed to separately, to put in a footnote, the first footnote in this complaint, the civil complaint, talks about the possibility of there being federal criminal statutes that have been violated and says explicitly in a court filling, which is making more for the Southern District of New York.
Now, nothing required the Southern District of New York in the midst of all of these reports that we've been hearing over the last year about valuations and about Michael Cohen's testimony, and we talked about how that -- he began a whole journey here. It's possible that we've already looked at it, or looked at it some.
It's also possible that they looked at it some, but they don't have all the material that has been conveyed by Letitia James' office and may be a combination of having looked at some things, seeing what the application of the statutes are, looking at all the detailed material, communications, depositions, and everything else, they think there might be a federal criminal statute violated, for example, mail fraud, wire fraud, or bank fraud. But it's too early to tell that.
TAPPER: So, journalists who cover business and finances have long said that Donald Trump has been lying about how much he's worth, how much his assets are worth. And obviously, this is -- this is something that could humiliate him. I wonder if you think, if the central allegation if proven in court will that have an effect on his supporters given how much they admire him for being so successful? Or do you think, OK, he's not worth $6 billion, he's worth $1 billion, who cares?
GRIFFIN: I don't think it's going to break through with his most ardent supporters. I would hope it would more broadly with the party. But think -- we are talking about this off the air, the number of Trump efforts that he's done that have come crashing down -- Trump university, his airline, he's proven time and time again not to be just a failed businessman in many senses, but somebody who misleads the public, or misleads his business partners.
People know this. It's all out there. And yet, many of his supporters stand by him despite this. So I'm not sure it has a political impact.
TAPPER: So, Preet, the New York attorney general is trying to permanently banned some of Trump's companies from ever doing business in New York. If she succeeds, walk us through what that means?
BHARARA: I mean -- it speaks for itself. It means that certain people cannot serve if he's -- actually successful, as directors of companies that are license or do business in in New York. And, by the way, she didn't just say corporations, but similar entities as well. And they simply can't do it. If they try to start a business, Letitia James or someone else can get an injunction, taking that opportunity right away from.
TAPPER: In New York, just in New York, though, right?
BHARARA: She can't prevent them from doing business in Florida --
TAPPER: Right.
BHARARA: -- in Mar-a-Lago, California, or any foreign country for that matter.
TAPPER: And, Alyssa, I want to get your reaction to a comment the attorney general made -- Attorney General James made during her press conference today.
(BEGIN VIDEO CLIP)
JAMES: Claiming you have money that you do not have does not amount to the art of the deal, it's the art of the steal.
(END VIDEO CLIP)
TAPPER: What do you think?
GRIFFIN: I think there's actually a powerful message because, again, to the point of his supporters and those who stand by him, they know if they did anything like this -- of course, not on that grand of a scale, but lied about their finances to get a loan, that they would have the book thrown at them, as she said. So, I actually thought it was a very powerful, rhetorical message to directly say that.
TAPPER: That is a big impression out there, though, Preet, and understandably so. You know this better than Alyssa and I do. That there does seem to be two kinds of justice. One for incredibly powerful, wealthy people, and one for the rest of America.
I bet there are a lot of people throughout who think, sure, if this was me, I'd go to jail, but Donald Trump will escape.
[16:15:01]
BHARARA: Yeah. Look, that's in some ways true. Some people have a lot of wealth and resources and staff can separate themselves from bad conduct that goes on. That's true in organized crime families. That's true in white collar criminal organizations.
Donald Trump is a person who never sends an email, who never sends a text. And most of the people who worked for him, Michael Cohen is an aside and interesting case, Allen Weisselberg on the opposite side of that, don't flip. They don't give information.
It's interesting that we began the discussion at the top of the hour talking about Michael Cohen. But for Michael Cohen, who knows how this would have ended up. And -- but for other people in Trump's orbit keeping their mouths shut, maybe he wouldn't get away with as much as he gets away with.
And here, by the way, I think the other -- the last thing that's important to talk about is, this is a civil case. So, your invocation of the Fifth Amendment right against self incrimination can be used against you. You can get the jury or the court to make an adverse inference.
Donald Trump in an exercise of great discipline which he didn't engage in when there's a microphone, took the Fifth reportedly 440 times in this exact proceeding investigation. Allen Weisselberg did the same thing. So, if he had nothing to hide in a civil matter, you can't say it's a criminal matter, why is he keeping shushed 440 times?
TAPPER: Well, because he has something to hide.
GRIFFIN: Well, and just really quickly if I could say, there's a parallel to how he governed as president, where we often, we wouldn't have actually known about many things that happened in the lead-up to January 6 and attempts to overturn the election if people didn't speak out. But many people close to him stayed local and kept their mouths shut. It's people like Michael Cohen and whistle-blowers who have come forward.
TAPPER: And many of them are still keeping silent.
Alyssa Farah Griffin, Preet Bharara, thanks so much.
Right now in Russia, anti-war protests and the Kremlin rounding up those who speak out. The arrests we are monitoring as Putin vows to send even more troops to Ukraine.
Plus, back on safer soil, Russia's release of two Americans, along among other prisoners of Putin's war in Ukraine. It's a prisoner swap and it's a good news story you'll bring you.
Stay with us.
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TAPPER: Topping our world lead -- more than 1,000 people have been detained across Russia, in a crackdown on anti-war protests, according to an independent watchdog group. These individuals you see on your screen right now are protesting, knowing that they risk up to 15 years, years in jail for protesting because they oppose Putin's announcement today, calling up 300,000 Russian reservists to go fight in Ukraine.
This follows a string of humiliating defeats in battle for Russia. Putin also raised the specter of nuclear weapons, promising to use all the means at his disposal if he thinks Russia is under threat.
President Biden told world leaders gathered at the United Nations today that Putin is not only trying to extinguish Ukraine's right to exist, he's also taking the torch to the United Nations charter itself.
As CNN's Nick Paton Walsh reports for us now, Putin's announcement dramatically raises the stakes and it dashes any slim hope that this war could end anytime soon.
(BEGIN VIDEOTAPE)
NICK PATON WALSH, CNN INTERNATIONAL SECURITY EDITOR (voice-over): His biggest statement since he began the war, he still won't call a war, delayed 12 hours until this morning, and perhaps less drastic than feared. But still, a huge move by Vladimir Putin who until now used this sort of volunteer recruitment process, declaring the first forced mobilization in Russia, even if it is partial, since World War II.
VLADIMIR PUTIN, RUSSIAN PRESIDENT (through translator): I repeat, we are talking only about partial mobilization. In other words, only military reservists, primarily those who served in the armed forces and have specific military occupational specialties, and corresponding experience, will be called up.
WALSH: And behind it all, the nuclear threat, falsely claiming the West had threatened Russia, and so Russia would have everything it had to defend its territorial integrity.
PUTIN: This is not a bluff. The citizens of Russia can be sure that the territorial integrity of our homeland, our independence and freedom will be insured. I emphasize this again, with all the means at our disposal. And those who try to blackmail us with nuclear weapons should know that the prevailing winds can turn in their direction.
WALSH: The mobilization is a huge undertaking, analysts said, when they've already failed to supply, equip, and effectively deploy their regular army over the past six months. It will not be quick.
SERGEI SHOIGU, RUSSIAN DEFENES MINISTER (through translator): Three hundred thousand reservists will be called up. I want to say, straightaway, this work will not be carried out as a one-off, but in a systematic, planned matter as I've already said.
WALSH: Unease already palpable on Moscow streets, even if protest was as usual, muted and suppressed.
You always feel worried, in moments like this, he said, because you have a wife and kids. You think about that. I would not want to leave them in case something happens.
The big question, amid all of the rhetoric of threats of escalation is does this change matters on the ground? Still, Ukraine pushes forward despite slight Russian grains around Bakhmut, Russia still struggles to match its status as a nuclear power with real progress and strategy on the ground.
Putin's bid to appear strong perhaps a reminder of how weak this war of choice has left him.
(END VIDEOTAPE) WALSH (on camera): The harsh rhetoric, frankly, are just raising the stakes of the Kremlin head. He's got a very complex and intense for five days ahead in which they're going to have to push these fake referenda through freshly occupied territory, and essentially at the end of that choose whether or not they embrace all of those areas of Ukraine as in their mind, part of Russia.
But his forced partial mobilization, they're going to have to move very fast and effectively to get anything like meaningful numbers on the ground to change the pretty awful situation for the Russian military here, particularly in the Donetsk region -- Jake.
TAPPER: All right. Nick Paton Walsh in Kramatorsk, Ukraine, thank you so much.
Let's talk right now to Major General Spider Marks.
General, where does Russia need the new forces the most?
MAJ. GEN. SPIDER MARKS, U.S. ARMY (RET.): Well, what you don't do in warfare is reinforce failure, which is what the Russians have experienced up in this area as you can see.
[16:25:07]
The Ukrainians have had a good job taking back the Kharkiv region. So, what I anticipate is that Russians would probably try to establish increased defensive positions in this area, primarily because, as you can see, the Ukrainians have some pockets of success, here, but where you don't want to have -- the Russians don't want to have is have that type of activity where the Ukrainians could separate these two forces, and then either reduce that or reduce that, and maintain Kherson, and then potentially take back Crimea.
Sorry, that's a mess, but I think that's what's going to happen, Jake.
TAPPER: Does Russia have the capacity to give these new 300,000 reservists the resources they will need once they're on the ground?
MARKS: They probably have the ability to muster the 300, 000, to get the minimally prepared. Bear in mind, a good percentage of the soldiers have probably had experience as a result of this fighting that took place -- there circled out every April, they bring in new recruits, but they remain in some reserve status.
So, there may be some currency of experience. There may be the ability to put them, as I said, with some degree, to move them forward. The key ingredient they're missing is leadership. And that's not going to be fixed for the longest time. I mean, that's a generational problem that the Russians have.
TAPPER: So, Putin has mobilized these forces. In your view, does this make it more or less likely that he ultimately might actually deploy nuclear weapons?
MARKS: Short answer is less likely, but Putin had a series of options he walked through, he could've mobilized what he chose to do, could he use a nuke, it might have been able to weaponize fuel and food a little bit more. He chose the mobilization option which really obviates for the time being the use of nukes.
TAPPER: All right. Major General Spider Marks, thank you so much.
Biden administration officials say they were expecting Putin's dramatic escalation of ground forces in Ukraine and they say it's a sign of Putin struggling.
As CNN's Phil Mattingly reports for us now, the president today affirmed the U.S.'s, quote, clear, firm, unwavering support for Ukraine.
(BEGIN VIDEOTAPE)
JOE BIDEN, PRESIDENT OF THE UNTIED STATES: Let me speak plainly. A permanent member of the United Nations Security Council invaded its neighbor, attempted to erase a sovereign state from the map.
PHIL MATTINGLY, CNN SENIOR WHITE HOUSE CORRESPONDENT (voice-over): At the core of President Biden's U.N. General Assembly address, an explicit and unsparing condemnation of a single country.
BIDEN: Russia has shamelessly violated the core tenets of the United Nations charter.
MATTINGLY: Biden singled out Russia, and called out President Vladimir Putin by name in a searing rebuke of its invasion of Ukraine.
BIDEN: This war is about extinguishing Ukraine's right to exist as a state, plain and simple, and Ukraine's right to exist as a people. Whoever you are, wherever you live, whatever you believe, that should not -- that should make your blood run cold.
MATTINGLY: The remarks coming just hours after Putin's most dramatic escalation, yet, in the seven month conflict, a series of moves that drew a direct response from Biden.
BIDEN: Just today, President Putin has made over nuclear threats against Europe, a reckless disregard of the responsibilities of the nonproliferation regime. Now, Russia is calling up more soldiers to join the fight. And the Kremlin is organizing a sham referenda.
MATTINGLY: The remarks delivered at an inflection point for the war, and in Biden's view, the entire world.
BIDEN: Putin claims he had to act, because Russia was threatened. But no one threatened Russia. And no one other than Russia sought conflict.
MATTINGLY: Biden endorsed the expansion of the U.N. Security Council as he ticked through a series of global challenges, from COVID and climate change, to nuclear weapons and hunger. But as he stood before the delegation of 193 nations, Biden closed with a clarion call to the members of one of the pillars of the post-World War II international order.
BIDEN: We're not passive witnesses to history. We are the authors of history. We can do this, we have to do it, for ourselves, and for our future, for humankind.
(END VIDEOTAPE)
MATTINGLY (on camera): And, Jake, despite Putin's announcement coming just a few hours before President Biden's speech, White House officials say there is no major rewrites to his remarks. He met this morning with his top advisor. There is some tweaks, emphasizing certain points, but in large part, more than anything else, those announcements only served to emphasize what the president had long plan to give in his remarks today -- Jake.
TAPPER: All right. Phil Mattingly reporting for us now live from the White House, thanks so much.
Keep it here, in just a few minutes, I'm going to speak live and exclusively with French President Emmanuel Macron, about Ukraine, about Putin's escalation, and much more of that, soon right here on THE LEAD.
Up next, the money lead, the cost to borrow, in a historic move to raise interest rates yet again.
Stay with us.
(COMMERCIAL BREAK)
TAPPER: In our money lead, ouch. The Federal Reserve this afternoon announced a three-quarters of a point increase in interest rates as the Fed is trying to fight inflation. That means the benchmark federal funds rate is in a range of 3 percent and 3.25 percent. That's the highest level since early 2008. We started the year with the rate near zero.
[16:35:01]
So keep that in mind.
The news was expected, but the announcement sent the stock markets down. After a brief recovery, the Dow plunged again, finishing 522 points lower.
I'm joined now by CNN's Rahel Solomon, along with Richard Quest who is on Wall Street.
And, Rahel, as we said, a big rate increase was expected. How will this affect consumers?
RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Well, in some ways, it already is, right? Anything that has an interest rate that isn't locked in, you're probably going to see that go up, right? I mean, credit card rates are at their highest level since 1995. Mortgage rates are at their highest level since 2008, and car loans, they're highest level since 2012, that information coming to us from Bankrate.
So, anything that isn't locked in, you're probably going to see that go up. And so, you can really start to understand the squeeze that some people are starting to feel already because, by the way, as rates have continued to go up, and we learned today they were going to go up even more, inflation is still at a percent. So, you're feeling it on both ends.
And this is part of that pain that Jay Powell has said we're likely going to see more of.
TAPPER: The Fed chair. What did the Fed chair say after the announcement?
SOLOMON: He really double down on a lot of the aggressive talk we have heard from him as of late. No sugar coating here. He said he expects the unemployment rate to go up, closer to 4.4 percent next year. He said he expects economic activity to slow quite a bit.
And on recession, Jake, well, he said, no one knows whether this process will lead to a recession or if so, how significant. Critics would say, rate hikes of this magnitude increase the likelihood of a recession.
TAPPER: Richard, I hear you chuckling over there. You're on Wall Street. What is the mood? Do investors expect a recession?
RICHARD QUEST, CNN BUSINESS EDITOR-AT-LARGE: Oh, yes. Reality has arrived. That's why you're seeing the market down 500 points.
They can dance around this as much as they like, but the truth is they've just stumped on the brakes with another three quarters of a percent point increase. It's an indication of how strong the U.S. economy is that they've had to take such drastic and dramatic action.
Jake, they start -- as you and I talked before, they started late, the Fed. They got behind the curve, and this train will not stop or slow down. However, the most worrying part of what we've heard today is the various projections that, unemployment forecast, the economic GDP forecast, it shows two things -- growth is going to go to virtually zero, and unemployment is going to start to rise. Not hugely, but it will rise.
And it's cause and effect, Jake. That's exactly what the Fed wants to do. That's the pain Rahel is talking about.
TAPPER: And, Rahel, we should also note that gas prices rose for the first time in almost 100 days. They've been falling steadily since hitting the record high back in June. Do you think this is a bump in the road or our prices at the pump going to go back up again?
SOLOMON: Well, it was nice while it lasted, right? Look, AAA warned about this earlier this week. There's a few things we're watching.
On the supply side, of course, the war and whether we see a major hurricane. On the demand side, whether we see a resurgence of COVID, whether we see a recession, as we're talking about with the Fed.
That said, we did talk to Mark Zandi, the chief economist of Moody's the last hour. He said he actually expects the gas prices to stabilize around $3.70 a gallon.
TAPPER: All right. And, Richard, we should note that Walmart says it's looking to hire 40,000 temporary or full-time workers for the holiday season, that sounds great until you look back last, year when Walmart was looking to hire 150,000 workers. Why the change?
QUEST: Because interest rates are going up, and therefore, consumer spending will slow down. And so, last year, it was going gangbusters. Low interest rates, fast growth, so Walmart needed those people.
This is the real economy. Just as much as FedEx told us last week of a slowdown, Walmart is telling us to slow down. Rates are going up. Things are going to slow down.
TAPPER: All right. Richard Quest and Rahel Solomon, thanks so much for that sobering news.
Coming up next, what Republican Governor Ron DeSantis is saying about a lawsuit he's facing link to that political move of moving migrants from Texas to Florida to Martha's Vineyard.
Stay with us.
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[16:43:21]
TAPPER: In our national lead, Florida's Republican Governor Ron DeSantis is now facing a class action lawsuit over his decision to fly a group of migrants to Martha's Vineyard in Massachusetts. The lawsuit in part says that if DeSantis defrauded vulnerable asylum seekers to advance a political motive.
CNN's Ed Lavandera joins us now from outside a migrant resource center in San Antonio.
Ed, how is DeSantis responding to the lawsuit?
ED LAVANDERA, CNN SENIOR NATIONAL CORRESPONDENT: Well, the governor says that they were working on behalf of the migrants, trying to give them a fresh start in Martha's Vineyard. He accuses the people who in the group have brought forth this lawsuit of engaging in political theater as well, and then went on to criticize them for busing the migrants off of Martha's Vineyard within a couple of days.
Everything the governor has said really doesn't address the allegations that many of the migrants have been putting out there since they first arrived in Martha's Vineyard. These are these allegations that they were promised by several different people here on the ground that they would be offered transportation, employment, housing, and immigration services once they landed and set up a new part of the country. In fact, the lawsuit goes on to say that once they landed in Martha's
Vineyard, they tried contacting the various different people who convince them to get on these flights. Those people wouldn't answer their phones anymore. That's at the heart of this lawsuit and not really something that the governor has addressed fully at this point.
TAPPER: Ed, are you hearing anything more about any future flights like this?
LAVANDERA: Well, Governor DeSantis in Florida and Governor Abbott has -- they both vowed to continue using either flights or buses moving migrants away from Texas and into, what they described as sanctuary areas in the country.
[16:45:12]
There was talk of a possible flight to Delaware yesterday. We were told by the sheriff that he believes that was postponed. It is not exactly clear what is going on, since both governors are vowing to continue. Why exactly these flights have been slow down, we don't know if it's an issue with the governor's office or with the private company that was contracted to carry out these flights. We just don't know at this point.
TAPPER: All right. Ed Lavandera reporting in San Antonio, Texas, for us, thank you so much.
Coming next, a welcome surprise to Americans among a group of prisoners of Putin's war now free. We have told you their stories before. So, what we know about the release and the journey home?
Stay with us.
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[16:50:17]
TAPPER: It is now my honor to present you with some rare good news in our world lead. The Russians have agreed to free two U.S. veterans who are captured while fighting for Ukraine. Alex Drueke and Andy Tai Ngoc Huynh, both from Alabama, have been held by Russian forces since June. They were freed as part of a prisoner swap between the Ukrainians and the Russians.
We are joined now by CNN Pentagon correspondent Oren Liebermann.
Oren, tell us about the deal. Where are these freed Americans now?
OREN LIEBERMANN, CNN PENTAGON CORRESPONDENT: Well, just a short time ago, a few hours ago, in fact, these two Americans, Alexander John Robert Drueke and Andy Huynh, stepped off a plane in Saudi Arabia. It was Saudi Arabia that behind the scenes organized this release of not only these POWs, but also five British assistance, a Swedish, Moroccan, and Croatian citizen as part of a bigger prisoner exchange between Ukraine and Russia. Saudi Arabia, working with U.S. behind the scenes, according to what
we know from a spokesperson of the families, the families didn't know about this ahead of time. So, as you said, great news, certainly incredible bit of news for these families. These two men, Alexander John Robert Drueke and Andy Huynh have gone missing fighting in Ukraine, in the Kharkiv region in early June. They have been in contact with the families when suddenly that contact ceased.
Their families feared that they had been captured, and that was confirmed shortly thereafter by the administration. It was the effort of a behind the scenes of getting to this point now a couple months later. We see them step off the plane. A spokesperson says they are in U.S. custody as they go to medical checks, the briefing, and, of course, presumably at that point they will be on their way home after the last few months in Russian custody.
TAPPER: Oren, is there anything we can read into this release as far as it concerns other Americans detained in Russia?
LIEBERMANN: There are couple things we can say generally speaking looking at this. First, it's obvious because of the families that know about this release ahead of time, that there are efforts ongoing from the Biden administration behind the scenes to make this work, to get to a point where Russia is going to release U.S. citizens.
Of course, we have been in the news a lot. Paul Whelan and Brittney Griner, President Joe Biden met with him just at the end of last week. Families of them, I should say, at the end of last week, bringing them in the first in-person meeting with their loved ones. Those efforts, I think you could say that, our ongoing.
There is now the point here that is worth making. You can see that for Russia there are interests here, it's not just about holding American citizens. Russia has its own interests in agreeing to a release like this, or release of prisoners like this.
The question is, what is their cost? That is the thing that the administration has to figure out. You see through an exchange like this that the interest is there. There is some room to maneuver here in hope of bringing Britney Griner and Paul Whelan home.
TAPPER: We have any idea when these two Americans will set foot back in the United States?
LIEBERMANN: Not sure about that yet, how long the briefing process could take, or for that matter the medical checks. They have been in the custody of the Russians or the pro-Russians since early June. So, that whole process of going through, what I'm sure are a battery of medical checks could take some time. And then the journey itself home at that point, that would be quite quick. But how quickly that goes through the medical and debriefing process, that could take a bit of time.
TAPPER: All right. Well, some happy families today at least.
Oren Liebermann, thanks so much. Appreciate it. Coming up next, a Republican House candidate who Democrats helped win his primary has some disturbing views about women, specifically whether women should be allowed the right to vote. The stunning discovery dug up by our KFILE team. That's ahead.
Plus, just moments ago, French President Emmanuel Macron wrapped up a speech. He is now headed here to our studio. We will talk about his take on Putin's war, his name being brought up in those Mar-a-Lago search documents, and much more. My exclusive interview with the president of France, that's coming up.
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[16:58:31]
TAPPER: Welcome to THE LEAD. I'm Jake Tapper.
This hour, it's not a crime to lie to the public about your net worth. But it may be one to lie to your bank. New York's attorney general is suing Donald Trump and his three oldest children, Ivanka, Eric, and Don Jr., accusing them all of carrying out a massive multibillion- dollar fraud.
Plus, there's a lot of misogyny out there on the campaign trail these days, but wait until you meet the Republican House candidate who had a website arguing that women should not be allowed to vote. He also has some strong opinions about women in the workplace.
And leading this hour, President Joe Biden just met with French President Emanuel Macron of the United Nations in a pull-aside. Later this hour, President Macron will be right here in studio live for an exclusive interview.
Biden and Macron's meeting comes hours after Russian President Vladimir Putin made a stunning declaration he ordered 300,000 Russian reservists to the front lines in Ukraine following weeks of Ukraine's military reclaiming large swaths of territory once occupied by Russian invaders.
In Russia, Putin's order has been met with rare anti-war protests. The Russian government handling dissent the way they usually do, detaining at least 1,000 protesters across dozens of cities, according to one report.
CNN's Matthew Chance reports now on the dramatic change in Russia's failing unprovoked war as Putin's bruised ego puts the world on nuclear watch.
(BEGIN VIDEOTAPE)
MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): As long as it stayed on the TV screens, not affecting their daily lives, many Russians have gone along with Putin's Ukrainian disaster, what he calls his special military operation.
