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President Joe Biden Meets National Security Team Situation Room As Tensions Escalate Between Israel And Iran; Kamala Harris Searching For Running Mate Now In Its Final Hours; U.S. Markets Plunge Amid Recession Fears. Aired 2-2:30p ET

Aired August 05, 2024 - 14:00   ET

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

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[14:01:17]

OMAR JIMENEZ, CNN HOST: With the Middle East on the brink of what could be a wider war, President Biden huddles with his national security team and what's expected to be minutes from now likely discussing the scenarios if Iran retaliates against Israel to the killing of a Hamas leader and how to keep the crisis from spiraling out of control.

BRIANNA KEILAR, CNN HOST: And we're waiting to learn who will join Vice President Harris on the Democratic ticket. She is making one of the most critical decisions of her campaign and that announcement could come at any time.

And Tropical Storm Debby is bringing floods and catastrophic rain to the southeast. Some towns are finding themselves almost underwater, and the storm is now blamed for a second death.

We're following these major developing stories and many more all coming in right here to CNN NEWS CENTRAL.

JIMENEZ: We're just moments away from a high stakes meeting in the White House Situation Room. President Joe Biden and Vice President Kamala Harris are getting ready to speak with their national security team as tensions threatened to boil over in the Middle East.

Now, Iran is vowing vengeance after blaming Israel for the assassination of a Hamas political leader in Tehran last week.

KEILAR: In anticipation of a retaliatory strike, the U.S. has already begun maneuvering military assets in the region. While Middle East leaders are scrambling to deescalate the situation before it devolves into all out wide scale war.

The White House says President Biden spoke with the King of Jordan this morning about those efforts. We have CNN Kayla Tausche standing by at the White House. All right, Kayla, what more are you hearing about this meeting today?

KAYLA TAUSCHE, CNN SENIOR WHITE HOUSE CORRESPONDENT: Brianna, the president is expected to arrive here back at the White House in moments from now and go to the Situation Room where he'll be joined by his national security team and Vice President Kamala Harris.

Now, the disclosure of this meeting is notable in its own right to essentially put the world on notice that the West and the U.S. in particular are evaluating how to respond to the potential and bracing for these potential retaliatory attacks.

When President Biden convened his national security team the last time that retaliatory attacks were launched by Iran, that was in mid-April, he was joined by his national security adviser, his secretary of state, his secretary of defense, as well as many members of the intelligence community and his CIA Director Bill Burns.

And this time, Kamala Harris, his vice president will be joining him in person whereas previously, she joined by secure video.

But it comes, as you note, after days where the administration has been sprinting to figure out how to position itself and how to shore up its alliances in the face of the potential for those attacks to unfold.

In a call yesterday with Israeli Prime Minister Benjamin Netanyahu, there was an extremely tense discussion, I'm told, over the demur prospects for the potential of a ceasefire deal because of that attack last week.

And as you mentioned, President Biden spoke this morning with the king of Jordan to try to discuss ways to deescalate those tensions. We will see exactly what if anything they decide in the meeting today, that's expected to take place just in a few minutes from now as they discuss the very high stakes and very volatile situation in an already fragile region, Brianna and Omar.

JIMENEZ: Kayla Tausche, thanks so much. A lot more to talk about here. Joining me now is former defense secretary under President Trump Mark Esper. He's now a CNN global affairs analyst and serves on the board as a strategic advisor for a handful of aerospace and defense related companies. Secretary, welcome to the program.

Now, look, you've been part of Situation Room meetings like this before, what is it like to be in that room at a time like this? What sorts of things would they be discussing here?

[14:05:08]

MARK ESPER, CNN GLOBAL AFFAIRS ANALYST: Sure, Omar, first of all, it usually begins with an intelligence update by the head of the CIA or the Director of National Intelligence, which who will give an update on what's happening in the region, specifically, obviously, with regard to preparations by Iran, and what they're seeing, then it might move to the State Department where the Secretary of State, in this case Tony Blinken would give his estimate of what the Israelis are thinking at the -- at a political level, and then probably also go around the region, you know, whether Jordanian is doing and we know, of course, if the Jordanian foreign minister was in Tehran, trying to talk down the Iranians, and then what are the Saudis think and other players. And I would hope, too, that there's discussion about our European allies and what role they might play. With regard to the Secretary of Defense again, having been there, my update would be to assure the president that our troops are prepared, that their positions are well defended and fortified, and that they -- we're moving troops or planes or air defense systems in place, which they are doing to make sure that we could support Israel and to help them knock down what other missiles, rockets or drones may be coming their way. If that's the course that Iran pursues in the next day, or two or three.

JIMENEZ: And just I want to get your perspective on this, too, because, one, what do you make of the timing of today's meeting, but not just the timing, the announcement of sorts. I mean, this is -- this is a telegraphing. They want people to know that this meeting is happening. I guess that's the best way to happen. What do you -- what do you make of that?

ESPER: Well, two things. First, I think it's important that the Iranians know that the United States is meeting to discuss how it will support Iran, it's important that there be no daylight between Tel Aviv and Washington at this point in time, and that none is perceived by Iran and its proxies, because my view is that will be conducted by Iran and its proxies.

Secondly, I think the timing is important, too, because we don't -- you know, nighttime is settling down on Israel right now, typically, these things are conducted at night, so you could see something beginning in the coming hours.

And then, also, to have the entire team there sends an important signal.

Again, I want to hear more about a multilateral approach in terms of defensive stance like we saw last time, not just with Arab states, but with European partners as well.

But I think this -- a lot of this, again, is messaging and signaling to the Iranians don't escalate, don't do this, we will be with Israel, and we will beat back your attack.

JIMENEZ: And I want to expand on one of the points you just made, because you said the most likely response here would likely be through Iranian proxies. What -- let's go a little bit deeper on that. What is the extent of the response that you expect? And how do you expect that response to be carried out?

ESPER: Well, just to be clear, I think it'll be with Iranian proxies, right with Hezbollah, Hamas, to a lesser extent, but the Shia militia groups, the Houthis, but I think the Iranians will conduct this attack, they need to -- after all, the killing of Ismail Haniyeh was conducted in Tehran, in a secure compound, you know, just after the ceremony bringing in the new Iranian President Pezeshkian.

So, they're going to want to push back because this is very embarrassing for them, it really showed the weaknesses continuing in their defensive system. So, it'll be them, then I suspect, again, Hezbollah will be another major player here and others.

And then the question will be is will they orchestrate some type of coordinated attack, which, unlike in April, will be less foreshadowing, more synchronized and probably produce a higher volume of rockets and missiles and drones, and more synchronized to hit at once. Their goal, I suspect would be to overwhelm Israeli defenses.

JIMENEZ: If you're looking at the situation as it is right now. Do you see a path to de-escalating the current tensions in any way? And if so, where would you start?

ESPER: Well, I think it begins with Iran, they're going to have to do something, because it's the nature of-- the Middle East's nature of the regime to always forcefully want to pull back. But we also know they don't want a regional war. They continue to message that, you know, unofficially through people within their government.

So, the question is, will they try and pull off what looks like a massive attack, which at the end of the day has really no serious outcome with regard to Israel, either killing Israelis or destroying Israeli facilities?

We won't know though until we see what happens at the end of the day, but will they kind of pull their punch a little bit like they did the first time around? Or at least signal the punch, I should say, like they did the first time around? We won't know that until we see it.

JIMENEZ: Yes. Secretary Mark Esper, incredible perspective. Thanks for being here.

ESPER: Thanks, Omar.

KEILAR: As Vice President Harris takes part in that meeting in the White House Situation Room, she's also juggling one of the most consequential decisions of her presidential campaign and that is picking her running mate, which is something that can happen at any time now.

[14:10:01]

Yesterday, she met with three top finalists for the job, Governor Josh Shapiro of Pennsylvania, Senator Mark Kelly of Arizona, and Minnesota Governor Tim Walz.

Tomorrow, Harris and her V.P. pick are set to hold a joint rally in Pennsylvania as they launch a week long campaign tour across seven key battleground states.

I'm joined now by Robby Mook, he is a former Hillary Clinton campaign manager. Robby, it's been a while, obviously. I covered that campaign. And I'm sure you're thinking about it a lot as you look forward toward this one here. Who do you think Harris should be picking as her running mate and why?

ROBBY MOOK, FORMER HILLARY CLINTON CAMPAIGN MANAGER: Well, Brianna, thanks for having me on today and you know what really has stood out to me throughout this entire process is the strength of all the different options that she had.

I think it's hard to go wrong here. You know, there, you look at any three of those people being talked about, you know, Walz and Kelly have national security experience. Walz and Shapiro are both popular governors from -- you know, we don't talk about Minnesota as a blue wall state a lot, but it's a blue wall state. And all three of them are, you know, popular in their states and all represent battleground states.

So, I don't think she can really go wrong. I do think that this is probably coming down to a sense of interpersonal chemistry. She probably as a vice president right now has some, you know, feelings about what makes somebody strong and qualified for this role.

I will give Governor Walz some credit. He has really kind of come from behind here. And we've really seen him take both Trump and Vance to task on cable, on social media. And I think his star has risen as a result of that, but I can't really say that one would be any better than the other. I think this is, you know, this is with her now. This is her decision.

KEILAR: Yes, maybe Waltz is a bit of a crowd favorite. He's got a lot of buzz, right? But you did tell Politico, essentially, I'm paraphrasing here, Robby. But if Shapiro buys her half a point in Pennsylvania, that that may be worth it for her.

I wonder, as you were looking at some of the headlines, we know that ahead of things like this, a lot of apo (ph) is going to come out and that has certainly happened here. He has faced added scrutiny over the weekend with several media reports, looking at his writings, for instance, in college about Palestinians, how his office handled a sexual harassment report criticism from Pennsylvania Senator Fetterman's team, about his ambitions.

You know, knowing that, what do you think? Does that impact things?

MOOK: I'm not particularly concerned about any of that. And look, we have to do a little bit of a comparison here. I mean, any of these folks are going to be way better than J.D. Vance. And I don't think Vance's problems are going away.

And I do think that Shapiro has always had a little bit of a lead or a head start in this contest, because Pennsylvania is so important to the electoral college map, I'm sure many of your viewers are getting on and doing the calculations, you know, the 19 electoral votes there are so consequential and really hard to replace with other states.

And for a governor who won by I believe it was a 20 point margin in a presidential midterm. You know, that really says something, if you can get 120 into that, one point extra so to speak, by putting them in there, that can absolutely be the margin of victory.

So, I do think that's an important attribute of his but again, I just don't -- I can't think of an argument that any of these are bad choices. KEILAR: If she doesn't pick Shapiro, I do wonder what some of the criticism for not picking him will be. For instance, Congressman Jake Auchincloss this morning condemned some of his fellow Democrats for criticizing Shapiro's positions on Israel. He said, there's a strong undercurrent of anti-Semitism to that. How much of that do you think factors into this decision when it comes to Governorship Shapiro?

MOOK: Yes, I mean, look, I'm not concerned, I think that people are so -- look, let's put it in this context. Think about how excited people were about Harris. There were concerns going in, well, we did this poll, and we didn't see that attribute and this or that thing, and people just coalesce behind her. I think the excitement is going to be so big that we will see the same thing.

So, I'm not worried about her being criticized for not picking him. And, you know, I welcome a discussion with the Republicans about, you know, Israel or anti-Semitism, because it was Donald Trump who said that there were good people on both sides when neo-Nazis were marching in Charlottesville.

So, I'm not concerned either way on this. I think this is really about who she thinks is ready to serve and who will be a good partner for her.

KEILAR: As you are looking back at your time managing the Hillary Clinton campaign, I wonder what your lessons learned from that might be applied here. What do you think?

[14:15:13]

MOOK: You know, it's an interesting question. I thought Tim Kaine was an excellent choice, and he really was a terrific asset to us on the campaign trail.

You know, some people came up to us after the campaign and said, I really wish you'd gotten somebody younger or somebody who is going to get the base really excited. And I think, you know, we've seen some of that, for example, around Governor Walz. So, I think that's something for her to take into consideration.

And I will say at the end of the day, I think we get really excited about this choice because it's this unknown. And we know we're going to learn soon. But I think the history on this is that this choice isn't enormously impactful.

As we said, maybe in Pennsylvania, she could get a little advantage with Shapiro. But, you know, we saw the rollout of J.D. Vance has kind of flopped. But Trump's numbers really haven't changed that much. He, you know, Biden had dropped and so, he added advantage over him. But Harris has filled up that gap. And now we're back to a dead heat again.

So, you know, I and I will say it's important. I think Trump is a great example of someone who made a very tactical pick, he tried to get someone who he thought would do well on T.V. and get his base excited. And it's clear there's not a lot of chemistry there. So, that's why I honestly -- I just hope that she's going with her gut and picking someone she's excited about, because that's one of those intangibles that, you know, it comes through. And it's going to come through at the convention and I really do believe that's the most important element here.

KEILAR: Yes, well, we will know soon enough, we can say that. Robby Mook, thank you so much for being with us today. We appreciate it.

MOOK: Take care. Thanks.

KEILAR: Ahead this hour on CNN NEWS CENTRAL, stocks nose diving as fears over the economy mount, why analysts are suddenly upping the odds of a recession?

Plus, entire Florida communities are underwater as tropical storm Debby is creeping inland. We're heading live to the Panhandle where catastrophic flooding is predicted. And at least two people have already died.

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[14:21:59]

JIMENEZ: All right, welcome back. We're following the market meltdown. You see a whole lot of red there. At its worst today, the Dow -- the Dow was down more than a thousand points as investors rushed to sell after Friday's weak U.S. jobs report helped rattle the global exchanges overnight.

KEILAR: And those deep drops in the red set the tone for the big plunge that we're seeing on Wall Street. So let's talk about this now with CNN Business Anchor Julia Chatterley.

Julia, you say there's no panic. But we see the fear and it is dripping all over that board there that a recession is coming.

JULIA CHATTERLEY, CNN HOST: Yes, so we were very cautious about using the P word, particularly in financial markets and creating self- fulfilling prophecies. What you're seeing is fear, it's not panic.

And I'll reiterate that again, I'm also very much watching the fact that we are off the market lows at this moment. So, the market close today is going to be really important to give us a sense of direction.

You said it, Brianna, there is a palpable fear that the U.S. economy is slowing more than we thought. And we saw that last week. It was exacerbated by weak manufacturing data by the jobs numbers too.

And that, of course, then raise questions about why on earth the Federal Reserve didn't lower interest rates last week when it had the chance.

My context on this, no one's talking about imminent recession. Yes, the economy is slowing. But we are still overall adding jobs. So, even on this, I think we need to take a deep breath. I even would be tempted to say if this were the only thing going on

that perhaps stock markets are overreacting to the U.S. data. The point is, though, it's not the only thing going on. We have seen tech stocks fueling the stock market rally all year. And suddenly people are looking at that and saying, have they gone too far too fast, you can see the weakness in tech stocks today. That's also adding to this and it's been going on for days.

Then, overnight, we get the Japanese stock market falling 12 percent. I'll allow you to use the P word on that. Now that's panic, you don't see that kind of move in a big global market without seeing spillover effects into the U.S. markets.

And the other thing I'll add here is also geopolitical risk. You've been talking about it, it all fuels sentiment, in addition to this being a summer Monday.

Now, there are silver linings here, one, if you're a stock market investor and around 60 percent of Americans are, then you're still up around 10 percent on the S&P 500 and the NASDAQ. We're just giving back gains, at least for now.

And if you're a borrower out there, you're struggling with high prices, which let's face it, it is everybody. The conversation around the Federal Reserve now has completely changed. We are not talking about will or won't the Federal Reserve cut rates in September, we're talking about how much.

They're watching all of this, and we will continue to watch the data. And if they need to cut rates by more than a quarter of a percentage point in September, they will do so.

So, I think it's clear to say help is coming even if it feels like it's late guys at this stage.

KEILAR: Yes, that's a really good point. To put it into that context. Julia, thank you so much for doing that.

[14:25:03]

And next, horrifying acts of violence in the U.K. as rioters set fire to and break into hotels used to house asylum seekers. The protests have been triggered by the deadly stabbing of three young girls and the false claim that the attacker was an immigrant. We're live in England right after this.

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KEILAR: Parts of the southeast are bracing for when Tropical Storm Debby slows to a crawl and is likely to dump historic amounts of rainfall for days on Georgia and South Carolina.