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Companies Lower Prices Despite Inflation; Trump's Joint Address to Congress; Lawmakers Prepare for State of the Union; Trump Address Congress Amid Inflation Worries; Bobby Arledge is Interviewed about Carolina Fires; Mark Zandi is Interviewed about Tariffs and Inflation. Aired 9-9:30a ET

Aired March 03, 2025 - 09:00   ET

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

[09:00:00]

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: It's a good investment in their business.

For example, Lalo in particular, they lowered prices by up to 40 percent on 90 percent of their products. So, take a look for an example there. A highchair was originally $235, now it's $195. A bib was $29.50, now it's $16.99.

Now, we know some of those prices may be still too high for consumers, but they're banking on the fact that this is going to hit and resonate with their current consumers. And they said that just in the month that they've been doing this, they've actually seen that their lower price items have quadrupled in sales. So, these companies are banking on this being a good business strategy in a time of economic uncertainty.

JOHN BERMAN, CNN ANCHOR: It does come at a cost, though. It does affect their bottom line, I imagine.

YURKEVICH: It certainly does. And experts warn that they - that companies need to look at their bottom line to make sure they can do this, because the worst thing to do is you do this and then change your mind, and consumers say, wait a minute, I thought I was getting a deal here. And that can - that can affect brand optics for consumers.

BERMAN: Right. Vanessa Yurkevich, great to see you. Thank you very much.

We've got a lot of news. A brand-new hour of CNN NEWS CENTRAL starts right now.

KATE BOLDUAN, CNN ANCHOR: President Trump preparing to lay out his vision for the country in his big address before Congress, just as Russia says that Trump's foreign policy largely coincides with their vision.

Elon Musk's purge of the federal workforce has left hundreds of NOAA employees now without a job, leaving experts now warning those cuts are going to hurt much more than just a weather forecast. And Hollywood's big night, the Oscars. The big winners, the long

speeches and the history making moments.

I'm Kate Bolduan, with John Berman. Sara is out today. This is CNN NEWS CENTRAL.

BERMAN: All right, just moments ago, President Trump previewed his speech before Congress tomorrow night. He says, quote, "tomorrow night will be big. I will tell it like it is."

The last few days that has meant telling it as Russia likes it. A short time ago, a Kremlin spokesperson commented on the president's Oval Office attacks on Ukrainian Leader Volodymyr Zelenskyy. The Kremlin says, quote, "the new U.S. administration is rapidly changing all foreign policy configurations. This largely coincides with our vision."

Let's get right to CNN's Alayna Treene at the White House.

The president, on social media, talking about this speech tomorrow. Alayna, what are you hearing?

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Right. Well, when - in my conversations, John, with White House officials, Trump administration officials, one, they say, of course, they are still working on this speech and they're hesitant to lay out any of the big priorities. Of course, they want it to be a surprise, like all presidents we see like to have it be when it comes to the State of the Union Address. But I am told at some point you can expect him to take a victory lap, not only after his election win, but, of course, he wants to try and point out and highlight some of what they argue are his big accomplishments in his first two months in office. And then you did see him, of course, saying he is going to tell it like it is on Truth Social this morning, referencing that.

But look, I think just to take a step back and remember the last time Donald Trump delivered a State of the Union Address, it was a far different Washington. One, he was freshly impeached. He also had yet to really see the coronavirus pandemic take place. But now we're also really seeing Washington be dramatically reshaped, in part largely because of what we've seen Trump do so far in office with slashing the federal workforce and trying to reshape it in his image.

But I think one of the biggest things, of course, is what is his speech going to look like as he addresses the world stage. And specifically, will he talk about Russia and Ukraine?

We heard another post from the president this morning as well. I want to read for you what he wrote. He said, quote, "the only president who gave none of Ukraine's land to Putin's Russia is President Donald J. Trump. Remember that when the weak and ineffective Democrats criticize and the fake news gladly puts out anything they say." So, clearly, he is watching some of the news this morning and over the weekend where people have been criticizing what took place in the Oval Office on Friday. But look, it wasn't just, John, Democrats who are criticizing him.

We've heard people from the president's own party. People like Senator Lisa Murkowski, who argued that the Trump administration is walking away from our allies and embracing Putin. She said it was plainly wrong. So, there's a lot of different reaction we are hearing from Capitol Hill, in addition to seeing, you know, having the White House really dispatch many of the people, top administration officials like Secretaries Rubio, National Security Advisor Michael Waltz, all of them really spanning the airwaves as well to defend him.

Key question today, of course, is, does that rhetoric shift and how do they move forward on this?

John.

BERMAN: Alayna Treene watching it all at the White House. Keep us posted, Alayna. Thank you very much.

Kate.

BOLDUAN: Watching it from the White House, but what are lawmakers now preparing for with that big speech tomorrow night?

[09:05:00]

CNN's Lauren Fox is live in Washington. She's got much more on this from that angle.

Lauren, what are you hearing?

LAUREN FOX, CNN CONGRESSIONAL CORRESPONDENT: Yes, I mean, there's obviously a lot of concern from some Republicans about what transpired in the Oval Office on Friday. You can expect that some people are going to want more clarity. One of those Republicans was Senator Lisa Murkowski, who had this blistering tweet over the weekend. She said, "this week started with administration officials refusing to acknowledge that Russia started the war in Ukraine. It ends with a tense, shocking conversation in the Oval Office and whispers from the White House that they may try to end all U.S. support for Ukraine. I know foreign policy is not for the faint of heart, but right now I am sick to my stomach as the administration appears to be walking away from our allies and embracing Putin, a threat to democracy and U.S. values around the world."

Now, Murkowski is really in a smaller camp in the Republican Party when it comes to concern over that Oval Office meeting. You have people like Senator Lindsey Graham, who has been a longtime supporter of providing aid to Ukraine, who said this over the weekend.

(BEGIN VIDEO CLIP)

SEN. LINDSEY GRAHAM, (R-SC): I have never been more proud of the president. I was very proud of J.D. Vance standing up for our country. We want to be helpful. What I saw in the Oval Office was disrespectful, and I don't know if we can ever do business with Zelenskyy again. He either needs to resign and send somebody over that we can do business with, or he needs to change.

(END VIDEO CLIP)

FOX: And, obviously, calling on a democratically elected leader to resign is something that a lot of folks on Capitol Hill are expressing some concern about this morning. A lot of Democrats expressing concern about it. And lawmakers return to Washington this evening. You can expect that they are going to be pressed over and over again on whether or not there is a real change happening in the Trump administration's response to Ukraine, and whether or not all the Republicans are going to be aligned with him.

Obviously, Murkowski, a voice who is separating herself from some in her party. We'll see if there's others when we talk to them this evening.

BOLDUAN: Very important questions to be answered for sure.

It's good to see you, Lauren. Thank you so much.

John.

BERMAN: Three years ago Lindsey Graham would be surprised by last night's Lindsey Graham.

All right, with us now is Christine Quinn, executive committee chair for the state of New York's Democratic committee, and former White House spokesperson under President George W. Bush, Pete Seat.

Friends, I'm going to change focus a little bit to this speech tomorrow night and what else the president will or will not discuss, because "The Wall Street Journal" and "Politico" and a lot of people are writing this morning about what Donald Trump, the president, has not been focused as much on.

Stephen Moore, who is a fierce ally of President Trump for years and years now, raises some concerns about how this White House isn't addressing the economy so much. Stephen Moore says, quote, "I'm nervous about it." Stephen Moore, a veteran outside adviser to Trump on economic issues. We have a graphic of this. "The Trump administration needs to keep its eye on what's happening with prices. It should be a top priority. The trend is a little bit troubling."

What do you think of that, Pete?

PETE SEAT, VICE PRESIDENT, BOSE PUBLIC AFFAIRS GROUP: Well, presidents have to walk and chew gum at the same time. And particularly when it comes to President Donald Trump, there was a lengthy to do list that he got from the American people when he was sent back to the Oval Office. On that to do list is reducing the size and scope of the federal government and reducing federal spending. We know that massive federal spending is inflationary. You get spending down, you can help prices. It's all interconnected. I understand that folks may want to hear more about the economy and action steps, but there's a lot that needs to happen all at once, and they're tackling it. BERMAN: I - you know, it's interesting because you make the case that

cutting spending is anti-inflationary. I actually haven't heard the White House or President Trump make that case yet because that could be an argument that he could try to make if he were trying to say that he is battling inflation and prices right now, but he just hasn't made it.

Christine, "Politico" has got a version of this, too. "Ahead of this joint session of Congress on Tuesday, a dozen of the presidents allies, Trump aligned Republican strategists and former administration officials are warning that Trump going all in on the Muskian effort is a risky gamble that threatens to overshadow his more popular and politically crucial economic and legislative priorities."

CHRISTINE QUINN, EXECUTIVE COMMITTEE CHAIR, NEW YORK STATE DEMOCRATIC COMMITTEE: I think that's right. And we're seeing it both in polls where he's losing support amongst independents, among women, among Hispanics, and more people think the country's going in the wrong direction than the right direction.

But most significantly, in an organic way, we're seeing Americans turn out at all of these congressional town hall meetings, make their voice very clear that they may have voted for Donald Trump, but they didn't sign up for hard working Americans, veterans, being laid off without any real analysis of whether their job is critical to the country, and whether it's a job that should remain or be cut.

[09:10:18]

That's not the Donald Trump they voted for. They want prices to go down. They want their pocketbook to go further, not shorter. And that's what's happening.

BERMAN: What do Democrats do, should they do in your mind tomorrow night during this speech? We've heard from members of Congress who are not going because they don't want to have to sit through it. We've heard from members of Congress, Chris Van Hollen, a senator, saying he's bringing people involved in some of the lawsuits against the administration on these layoffs. How do you think they should behave?

QUINN: Well, I think the Democrats, us Democrats, we need to hit back hard. We need to stop being the party that takes it on the chin, that turns the other cheek. We need to be as tough on Donald Trump as he has been on us. I think for some people, like Senator Murphy from Connecticut, not going and being a real leader and a voice of opposition is the right answer. I also think bringing people who symbolize who Trump has forgotten can work. But what can't work is just sitting in your seat being angry and discouraged. We need to fight back.

BERMAN: All right, Pete, how about Republicans? How about those Republicans, like James Lankford? How about those Republicans like Mitch McConnell? I guess the former Lindsey Graham, who were supportive of Ukraine's efforts to beat back the Russian invasion, how will they feel tomorrow night if we see more of the Oval Office Friday version of President Trump in this address to Congress? SEAT: Well, I think it's absurd to say that we are abandoning an ally

after what occurred on Friday in the Oval Office. If we were abandoning allies, the president of the United States would not have met with the president of France, the prime minister of the United Kingdom, and the president of Ukraine in the span of just a couple of days at the White House. He hosted all of them. He would not have sat next to the president of Ukraine in the Oval Office, which clearly and obviously annoyed Vladimir Putin. He wouldn't have had a mineral deal literally on the table in the East Room, ready to be signed. That also annoyed Vladimir Putin.

So, to think that we're abandoning an ally I think is farcical, and I'm sure we're all going to be watching and listening very intently for what the president may or may not say about that, and the next steps in the negotiations. But that's the key here, there needs to be a negotiated end to this conflict. It is the only path forward.

BERMAN: Look, the Kremlin doesn't sound annoyed this morning. I will say that. They say its - they're basically celebrating the fact that U.S. foreign policy seems to, in their words, now align with theirs. We'll see what the next 48 hours holds.

Christine Quinn, Pete Seat, thanks, both, so much. Great to see you.

So, amid all of this, as we've been saying, the president will speak to Congress tomorrow night. Join CNN for all the coverage. It begins tomorrow night at 8:00 p.m.

Kate.

BOLDUAN: Firefighters are battling more than 175 wildfires across North and South Carolina. Evacuations ordered. A statewide burn ban in place. We're going to take you there for the latest.

Tariffs. They're coming. That's the message from the commerce secretary, just as he also says very quickly, quote, "it's a fluid situation" and maybe an understatement of the year. So, what does it mean for American consumers?

And all of the highlights from Oscars night. The fashion, the winners, the speeches. They're still talking about it.

(BEGIN VIDEO CLIP)

KIERAN CULKIN, ACTOR: But it was just over a year ago. She said, I will give you four when you win an Oscar. I held my hand out. She shook it. And I have not brought it up once until just now. You remember that, honey? You do? OK.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

[09:18:29]

BOLDUAN: The scene in South Carolina over the weekend, emergency responders, residents rushing to get out of the way of fast burning fires that erupted there. One forest fire near Myrtle Beach has burned upwards of 1,600 acres and is about 30 percent contained now. Residents who were evacuated, they were allowed to be back into their homes Sunday evening. So, some good news there.

Several fires were also reported in North Carolina, threatening some of the areas still recovering from the disaster that was left behind from Hurricane Helene.

Let's talk about that. Joining me right now is Bobby Arledge. He's the director of the Polk County Emergency Management in North Carolina.

Thank you so much for taking some time.

What is the very latest on the fires, on the situation in your county right now?

BOBBY ARLEDGE, POLK COUNTY, NORTH CAROLINA EMERGENCY MANAGEMENT: Good morning. In Polk County this morning, the fire is 481 acres. We're about 30 percent containment as of this morning.

BOLDUAN: I've seen that the weather forecast is supposed to improve today kind of by and large. Winds dying down. Cooler temperatures setting in. What's that going to mean for your crews?

ARLEDGE: It's a big help for our crews, especially with the winds. On the first day of the - the first day of the - of the fire, you know, winds were pushing the fire everywhere. With the winds being calmed down, we're able to get lines in, reinforce lines we've already got, do some back burn operations and, you know, protect structures that are in danger.

BOLDUAN: Now we're also - as I mentioned, we're also talking about an area that is still recovering from the horrible effects of Hurricane Helene.

[09:20:01]

Now, add all of this now in. I mean, what have these natural disasters done to the region? What have they meant for your county?

ARLEDGE: This county and this - this area that it hit, it was one of the hardest hit by Helene. The whole county was hit. But this area that we're in, with this fire up here, was - was one of the worst - worst areas impacted by Helene. So, they're still in the midst of cleaning up. You know, we still have damage to structures. We still have people trying to get their lives back together and now we have this. So, it's just - it's heartbreaking for - for us, as emergency responders, for these folks that's still trying to get their lives back together.

BOLDUAN: I mean are we talking about, you know, people who lost, you know, everything in Hurricane Helene, they're trying to pick up the pieces, trying to, you know, many of them trying to rebuild their homes. I now these are some of the very same homes that are now threatened by these fires? ARLEDGE: Some are, yes.

BOLDUAN: Do - do you have everything - do you have everything you need? Do you need help? How's the - what's the coordination with the state? What about with - from the federal government as well?

ARLEDGE: State has been great. They've offered, you know, additional fire resources for us. So, they're here on the ground with us working. We've had, you know, tremendous turnout from our mutual aid partners throughout North Carolina and South Carolina. We've got - you know, we've got fire departments from North and South Carolina here working the fire, trying to give some of our local guys a break that were here for the first couple days. So, we've had really good luck, you know, with state partners.

BOLDUAN: That's great to hear.

Bobby Arledge, thank you very much for taking the time. Good luck out there. My goodness.

ARLEDGE: Thank you.

BOLDUAN: Coming up for us, this morning, scientists are warning that lives could be at risk after the Trump administration fired hundreds of people in charge of forecasting the weather. We're going to dig into that.

(COMMERCIAL BREAK)

[09:26:26]

BOLDUAN: President Trump's sweeping tariffs on Canada and Mexico expected to go into effect tonight at midnight. But how high will they go? And could they still be pushed off another time? Key and significant questions about Trump's trade moves with Canada, Mexico and China included. Even just hours left - with even just hours left before they're supposed to be setting in.

According to Trump's commerce secretary, the situation is fluid. President Trump, last month, proposed a 25 percent tariff on both Canada and Mexico. Leaders in almost every industry have also then warned that if those tariffs, when those tariffs set in, it's going to raise prices on everything from shoes, to electronics, from groceries, to cars.

Investor Warren Buffett, he just weighed in for the first time, saying that he thinks tariffs could trigger inflation.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: How do you think tariffs will affect the economy?

WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY: I mean tariffs are actually - we've had a lot of experience with them. They're - they're an act of war to some degree.

UNIDENTIFIED FEMALE: How do you think tariffs will impact inflation?

BUFFETT: Over time they're a tax on - on goods. I mean, you know, the tooth fairy doesn't pay them.

(END VIDEO CLIP)

BOLDUAN: Donald Trump's treasury secretary, though, pushing back on those inflation fears.

(BEGIN VIDEO CLIP)

SCOTT BESSENT, TREASURY SECRETARY: We have the experience of President Trump's first term, where the tariffs, they did not affect prices. And it's a holistic approach that there will be tariffs, there will be cuts in regulation, there will be cheaper energy. So, I would expect that very quickly we will be down to the Fed's 2 percent target. So, I'm expecting inflation to continue dropping over the year.

(END VIDEO CLIP)

BOLDUAN: Joining us right now is Mark Zandi. He's the chief economist at Moody's Analytics, of course.

It's good to see you again, Mark.

So, what we just heard there from the Treasury secretary is something that I've heard multiple times now in interviews with Donald Trump's top trade adviser. The tariffs are not going to cost consumers more in driving up prices. What do you say to that?

MARK ZANDI, CHIEF ECONOMIST, MOODY'S ANALYTICS: I'm with Warren Buffett. I think they're going to raise prices. They're attacks on American consumers.

I mean if you add up all of the tariffs that are now in play, those that have already been imposed, like the 10 percent on China, and those that are being discussed, like the 25 percent on Canadian and Mexican imports, add that all up, Kate. That will add about $1,250 to the typical American's bill over a period of a year. So that gives you kind of context.

And, you know, that assumes that the price increases related to the tariffs are kind of one off. You know, they're just - they - everyone passes those through to American consumers. That's the end of the story.

But I'm not so sure that's going to be the case this go around because the inflationary backdrop in the current environment is very different than the one in President Trump's first term. Back then, the problem was inflation was too low. Inflation expectations were nonexistent. Today, because of what we've - Americans have gone through, all the inflation that they've suffered, inflation expectations are very fragile.

So, this increase in tariffs could be more persistent and more of a problem. And I don't think we're going to get back to the Federal Reserve's target if these tariffs go - go through.

BOLDUAN: That's exactly what I was going to ask you. I mean the two - saying that 2 percent inflation target is going - they're going to be able to hit it quickly, now with tariffs setting in, I mean does that at all seem reasonable?

ZANDI: Not in the near term, no. I mean not while the tariffs are being imposed.

[09:30:00]

I mean at some point, though, the tariffs will do economic damage, right, because they'll cost American jobs. You know, especially if other countries respond and retaliate