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End of Interview with Rep. Adam Smith (D-WA); Biden Announces New Security Aid Package For Ukraine; NATO Members Worry About Trump Presidential Win; Prices Fell In June For First Time Since Start Of Pandemic; New Hope For Fed Rate Cut As Inflation Cools In June; Crime Scene Technician Resumes Testimony In Alex Baldwin Trial. Aired 1:30- 2p ET

Aired July 11, 2024 - 13:30   ET

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

[13:30:00]

BORIS SANCHEZ, CNN HOST: Congressman Adam Smith, we have to leave the conversation there. Appreciate you coming on to share your perspective.

REP. ADAM SMITH (D-WA): Thank you.

SANCHEZ: Still to come, a key meeting between President Biden and Ukrainian President Volodymyr Zelenskyy. The two leaders coming face- to-face at the NATO summit. We have the latest headlines from there.

Plus, a second day of testimony underway in the manslaughter trial of Actor Alec Baldwin. Defense attorneys questioning of crime scene technician about how the FBI handled a key piece of evidence, perhaps the most important piece of evidence in this entire case. Details straight ahead.

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JESSICA DEAN, CNN HOST: Just minutes ago, President Biden announced a new military aid package for Ukraine while meeting with President Volodymyr Zelenskyy on the final day of the NATO summit here in Washington, D.C.

[13:35:02]

The leader of the war-torn country has been calling on NATO to supply more weapons to Ukraine or risk losing this war to Russia.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: Russia will not prevail in Ukraine. Will not prevail in Ukraine. Ukraine will prevail. And I want you to know we're going to be with you every step of the way.

VOLODYMYR ZELENSKYY, UKRAINIAN PRESIDENT: Together, we are preserving Ukraine's independence and freedom. And this is historic actions that will protect the world from -- from similar wars.

(END VIDEO CLIP) #: Let's bring in our next guest, former NATO supreme allied commander and founder of Renew America Together, General Wesley Clark.

General, always good to have you on. Thanks so much for being here.

Ukraine has certainly been at the center of this summit. We just saw President Zelenskyy there with President Biden. He's been asking for more assistance, more support.

In your opinion, is the current level of support, both from the U.S. but more widely across the globe, is it enough to sustain Ukraine?

GEN. WESLEY CLARK, FORMER NATO SUPREME ALLIED COMMANDER & FOUNDER, RENEW AMERICA TOGETHER: No, it's not enough yet. But -- and we've got to take the restrictions off how Ukraine can use its weapons to go after Russia.

But, but it's a step forward and it moves us in the right direction. And that's what we've got to do.

Look, the Ukrainians have to do their part also. They've got a lot of work to do building their armed forces, using the weapons properly, learning to maintain them.

And forming the idea, the concept of how they're actually going to win. Just saying you need more weapons, OK, that works for air defense. But artillery, tanks, aircraft, what do you need them for? What are you going to do with them? How does it contribute to the overall political goal?

And that's what's been missing from the discussions that I've heard at the summit and before.

DEAN: And so how do they get to that point? It sounds like what you're describing is a sharper strategy.

CLARK: Right. It's got to -- got to sort of look beyond the immediate, which is hold the line, don't let the Russians have a breakthrough.

And then you've got to put your thinking cap on, and say, OK well, how do we roll this back? How do we penetrate that obstacle zone? How do we get into Crimea? How do we convince Mr. Putin he cannot win?

This is the thing. This will go on until Mr. Putin realizes he's not going to win. So if it's just a matter of for tit for tat, we'll give you one new weapon, the Russians, in six weeks or three months, figure out how to counter that weapon.

OK, we've got another one on the shelf. Here comes another one. But it's not decisive. What we want is to build up the strength and build up the capabilities of the Ukrainian armed forces so it can be decisive.

Now, we did this ourselves during World War II. It's how we invaded France at Normandy. We all talked about the 75th anniversary of this just a few days ago or the 80th anniversary. And it was a great story of how America pulled itself up by their

socks, built the force, got the new technologies, had the concept, did the deception planning.

So it's a lot of really hard military stuff here that has to be done. It's not just the weapon systems. But the burdens on Ukraine to do that.

DEAN: And an elephant in the room during this summit has certainly been the domestic politics of the United States.

We know that the former president, Donald Trump, has said, in part, he might leave NATO. There are questions over what U.S. support for Ukraine would look like during a Trump presidency.

So I'm curious, from your perspective, how the question of U.S. leadership impacts, both the summit but also NATO moving forward in the immediate future?

CLARK: Well, first of all, there's a lot of fear about what would happen if Mr. Trump becomes president again. So most of the Europeans believe he will reduce U.S. support to NATO.

He will make the Article Five pledge contingent on something, that he'll cut intelligence sharing, that he'll pull troops back, that he'll somehow undercut Ukraine by direct conversations with Mr. Putin or something.

So the Europeans are moving in two different directions simultaneously. One, they recognize they've got to do more for themselves. They've always had a little bit of a structure for this but they didn't put the resources into it really. Now they've got to do this.

But secondly, in many of these European countries, there's political opposition. And they know how to deal with Putin. And they take money from Russian middlemen and businesses and other things.

And there's the risk -- and this is probably what Mr. Putin is counting on -- that should the United States pull back and Ukraine start to falter, the opposition in these countries will pop up and suddenly take over. And you'll have a bloodless takeover of Eastern Europe and the NATO Article Five pledge won't mean anything.

[13:40:02]

Because the countries will say, oh, we're not worried about Mr. Putin and we know how to get along with Russia, he's not going to hurt us much, blah, blah, blah, blah.

You can already hear this from Viktor Orban in Hungary. And so that's the model that Mr. Putin is working on covertly and through his hybrid warfare.

So these European countries have to prepare and do directions. They have to prepare to prevent that. They also have to strengthen their military capability.

DEAN: There is so much at stake.

General Wesley Clark, thanks so much for your time. We appreciate it.

CLARK: Thank you.

DEAN: Still ahead, prices did something we have not seen since the beginning of the pandemic. We'll tell you next.

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DEAN: Some good news today for millions of Americans struggling financially. For the first time since the pandemic, prices fell in June and inflation cooling now for a third straight month.

[13:45:03]

SANCHEZ: Let's take a look at how the stock market is responding. The Dow up roughly 34 points. NASDAQ and S&P slightly down. Today's report is boosting hopes that the Fed will cut interest rates.

Let's get the latest from CNN's Matt Egan.

So, Matt, break down these new numbers and what it could mean for consumers.

MATT EGAN, CNN REPORTER: Well, Boris and Jessica, this really looks like the best inflation report in literally years.

Of course, inflation has been the number one problem in this economy. And this is the clearest evidence yet that inflation is going back to normal. Not there yet, but a big step in the right direction.

Prices were supposed to inch up between May and June. They didn't. They fell slightly. We haven't seen that since COVID crashed the economy back in 2020. And on an annual basis, prices we're up by three percent.

Now that's not back to normal. But this is tied for the lowest rate in three years. You can see the improvement on that chart. We are miles away from the peak two years ago when this metric was at 9 percent.

And when you dig into the report, you can see why. There were big price drops for a number of categories, everything from new cars and used cars, gasoline, appliances, toys, airfare. All of them going down.

Now, none of this means the cost of living is no longer a problem. Of course, people are still hurting from three years of price hikes. There's a snowballing effect to inflation.

But all along, the best case was that prices would start to go up at a more gradual pace. And increasingly, it looks like that is happening. And that is very good news.

DEAN: And, Matt, I think a lot of people now wonder, what does this mean about a possible -- for a possible rate cut by the Fed?

EGAN: Yes, Jessica, it does look more and more like the Fed is going to be able to give borrowers a break on interest rates.

Just look at this reaction that came out after today's inflation report. A former Obama economist, Jason Furman, he praised this as amazing inflation data.

Oxford Economics declared that the stars are aligning for a September rate cut. And Economist Paul Krugman, he just said, the Fed has got to cut.

And in the hours after the data came out, JPMorgan, they moved up their call. They are now predicting a rate cut in September. And investors on Wall Street are increasingly betting on that.

If you look at the latest numbers, investors are pricing in about a 94 percent chance of a rate cut in September. That is up significantly from just a day ago. And a month ago, this was looking like it was only 50-50.

Now, this would be very good news for consumers, right? It would mean everyone would get a break on the cost of a mortgage or credit card debt, car loans, student debt.

And the timing here could be pretty noteworthy, too, because the September meeting, that is the last time the Fed meets before the election -- Boris and Jessica?

SANCHEZ: Yes, that eagerly awaited potential rate cut.

Matt Egan, thank you so much.

EGAN: Thanks.

SANCHEZ: Still ahead, it's the conservative playbook for the next Republican president that has drawn considerable blowback. And while former President Trump claims he knows nothing about Project 2025, a CNN review found that dozens of people who worked for him we're deeply involved.

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[13:52:42]

DEAN: Happening now, it is day two of testimony underway in Alec Baldwin's involuntary manslaughter trial.

SANCHEZ: Yes, just took a break for lunch moments ago.

Earlier, a crime scene technician was on the stand being cross- examined by defense attorney, Alex Spiro, about the evidence collected after the 2021 fatal shooting on the set of the film, "Rust."

CNN's Elizabeth Wagmeister joins us now with details.

So what stands out to you, Elizabeth, from today's proceedings?

ELIZABETH WAGMEISTER, CNN ENTERTAINMENT CORRESPONDENT: You know, Boris and Jessica, this has actually been a big morning with crucial information coming out from this testimony that confirms that live bullets we're found on this set not just in the gun that was held by Alec Baldwin.

This crime scene technician, who has been on the stand all morning and was also testifying yesterday, so she's been up there for quite some time, she said that there we're live -- a live bullet that was found in the holster of another actor by the name of Jensen Ackles.

Let's take a look at what was said in the courtroom.

ALEX SPIRO, DEFENSE ATTORNEY FOR ALEC BALDWIN: So Mr. Ackles, another actor on the set, turns out that he, as he acted, as he performed, had a live bullet in his bandoleer, correct?

MARISSA POPPELL, CRIME SCENE TECHNICIAN: Yes.

SPIRO: And you know no reason to think Mr. Ackles had any idea that was there, right?

POPPELL: Correct.

(END VIDEO CLIP)

WAGMEISTER: So what we're seeing there is that it appears Alec Baldwin was not the only actor on the set of "Rust" who could have been put in a position of holding a gun that possibly contained a live bullet without knowing it?

Now, as this testimony went on, Baldwin's attorney, Alex Spiro, questioned this crime scene technician, asking about the difference between live bullets in dummy bullets.

They showed photos to the jury. And they we're trying to prove the point that it's very difficult to tell the difference between a dummy bullet and a live bullet. Certainly, for a lay person. You see right there that they all look very similar.

This crime scene technician also confirmed that there should never be live ammunition on a movie set. And that question still remains: How did those live bullets get there?

[13:55:05]

DEAN: Yes. And, Elizabeth, is there any idea who's expected to take the stand next?

WAGMEISTER: We don't know the order of witnesses that will be called. But of course, the big name that is on the prosecution's witness list is Hannah Gutierrez Reed. This is the armor from "Rust."

She was already convicted and is currently serving an 18-month sentence. She faced the same charge of involuntary manslaughter that Alec Baldwin is facing.

So it will be incredibly significant when she gets on the stand. She is expected to testify. Although, she said in pretrial interviews that she does not want to testify.

Now she is appealing her own conviction. So anything that she says can also impact that. So that's -- it's what all eyes are on right now.

DEAN: Yes, certainly.

All right. Elizabeth Wagmeister for us, thanks so much. Appreciate it.

And still ahead, the pressure is only growing as President Biden is staring down a crucial press conference tonight. CNN has new reporting on the mood among Democrats and inside that building, the White House.

Stay with us.

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