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Inflation Fell in March; Jessica Bettencourt and Beth Benike are Interviewed about Tariff Impacts; House Republicans Plan Budget Vote; ICE Sending Immigrants to Facilities Away from Home. Aired 8:30- 9a ET

Aired April 10, 2025 - 08:30   ET

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

[08:30:00]

KATIE BO LILLIS, CNN SENIOR REPORTER: The Trump administration has wanted to do since the earliest days of the administration. Initially it was Chief of Staff Susie Wiles who was approving or disapproving who got to have access to this book. Now, of course, since the confirmation of the director of national intelligence, Tulsi Gabbard, she's really taken responsibility for the project.

But look, one of the key lessons that President Trump learned from his first administration was, he really believed that career intelligence officials were weaponizing intelligence by deliberately leaking both intel and analysis, sometimes items that appeared in the PDB itself, out of an effort to undermine him or try to sort of box him in. And he was really determined not to let that happen again. And so, you've seen this both in his determination to name officials to top national security posts that he sees as true MAGA loyalists, and also to try to restrict the number of people who have access to key information. And so, officials inside the intelligence community are really seeing this move kind of against that backdrop.

Now, it is really normal for a new administration to come in and kind of rejigger who has access to the PDB. New administrations frequently come in, they look around, they're like, man, there's a lot of people who are getting access to this highly sensitive book. Does everybody need to see every day what the president himself is seeing? They cut down. Sometimes people renegotiate, try to get added back on. Really, really normal.

But this is still happening against this backdrop, against - of what U.S. intelligence - U.S. officials, rather, have described to us as an intense distrust in between the Trump administration officials and the intelligence community. And this is really seen as kind of a manifestation of that dynamic, John.

JOHN BERMAN, CNN ANCHOR: As you note, this is the kind of thing that can happen for different reasons when a new administration comes in.

What are some of the risks that could arise from - from perhaps over restricting access to this document?

LILLIS: Yes, so this could go two ways. We talked to a lot of former intelligence officials familiar with this process who said, it could be a good thing, right, because it could give President Trump confidence that the information he's getting from his intelligence community is not going to be leaked. But if you restrict it too tightly, you run the risk that you're going to have top officials in the administration working off of a subtly different operating picture. And that could lead to an inconsistent foreign policy, a little bit of a confused foreign policy. So, that's - that's really the risk here, John.

BERMAN: All right, Katie Bo Lillis, in Washington, thank you very much.

We do have some breaking news. Key inflation data just in. What does it say and what does it mean for the economy and the markets, which have been roiled of late?

(COMMERCIAL BREAK)

[08:37:07]

KATE BOLDUAN, CNN ANCHOR: Breaking moments ago, brand new numbers showing inflation fell last month. Much better than expected things are looking.

Let's put it all in context right now. Matt Egan is going through the numbers.

This is an important - another important data point coming in. What are you learning?

MATT EGAN, CNN REPORTER: Yes. Well, Kate, this was better than expected. An encouraging report about arguably the number one economic issue, right, the cost of living. Of course, the problem is, it does not capture the elephant in the room, at least not fully, right, and that's the trade war. I'll get back to that. Let's go through the numbers.

So, consumer prices month over month - so this was actually a drop of 0.1 percent, negative 0.1 percent. That's the first time we've seen that since Covid. Year over year, the annual inflation rate was at 2.4 percent. This was also better than expected, and a six month low, moving in the right direction.

As far as why this happened, there's a few drivers. One thing that really played a role here, as you can see the trend here, the inflation rate dipping a little bit. One of the drivers was energy. The fact that gasoline prices did not move up like they usually do in the month of March, that really helped the inflation rate. Of course, one of the reasons that happened was because of recession fears, right? We saw oil prices plunge.

BOLDUAN: Yes.

EGAN: Gasoline prices kind of stayed steady and dipped a little bit. So, that's one of the reasons why this report was better than expected. I know one thing that everyone's paying attention to is the cost of

groceries, and eggs in particular. We kind of got mixed numbers on that. Month over month, eggs were up by 5.9 percent. That's a deceleration, but still a big increase. And look at this -

BOLDUAN: Yes, that's what I was going to say, if even it's slow, it's a lot still.

EGAN: It is. And the overall price of eggs still going higher and higher to all-time highs, 60 percent year over year increase in eggs.

BOLDUAN: Wow.

EGAN: Even though we have seen some signs of progress when it comes to wholesale prices. So, that continues to be a major source of pain.

I think the big asterisk here is, this is all before the trade war got a lot worse, right? This only takes into account the 20 percent tariffs.

BOLDUAN: I mean every - the things have - yes, things have changed -

EGAN: It's a different world than it was.

BOLDUAN: In 24 - in 24 hours and then 24 hours and then 24 hours.

EGAN: Right. Right.

BOLDUAN: I mean, this has been -

EGAN: So, this is a snapshot in time and it shows where inflation was before the trade war got a lot worse. The question is, what happens to prices in the coming weeks as these tariffs kick in.

BOLDUAN: Again, the, what happens next is the story line of - of the day.

What about - what about the trade war? What about the bond market? I know you've been looking at this.

EGAN: Yes. So, obviously, the stock market gets all of the headlines.

BOLDUAN: Yes.

EGAN: So, what's interesting is that a lot of investors that I'm talking to, they think it really was some red lights flashing in the bond market that got the president to move.

BOLDUAN: For sure. That's all the reporting. Yes.

EGAN: So, what you can see here is this is the ten-year Treasury yield. What's notable is that even though the stock market started plunging in late March and early April, the ten-year Treasury rate actually started going significantly higher. This is unusual, and it's important because it meant that the cost of borrowing was going up for the federal government, for consumers, for businesses.

[08:40:06]

So, Ed Yardeni told me that he thinks that the bond market really spooked the president here. And it's because bond vigilantes were screaming that they weren't happy with what was going on, and there was a potential for a recession.

And, Kate, the president himself sort of acknowledged that he was at least watching what was going on in the bond market. As we look at where U.S. futures are this morning, after yesterday's massive rally, a little bit of a reality check this morning as U.S. futures are signaling a red start this morning, despite that better than expected inflation report.

BOLDUAN: The bond markets seem to be able to intimidate anybody. Bond vigilantes, watch out.

EGAN: Yes.

BOLDUAN: I mean - Matt, thank you so much.

EGAN: Thanks, Kate.

BOLDUAN: John.

BERMAN: All right, those inflation numbers, though, a bit of good news for this administration that's seen a lot of bad numbers recently.

Let's talk about where things stand right now. With us is CNN chief data analyst Harry Enten.

HARRY ENTEN, CNN CHIEF DATA ANALYST: Hello.

BERMAN: So, there was the great buckle. The blink heard round the world.

ENTEN: Yes.

BERMAN: The reversal of most of the tariff policy, or much of it, from President Trump. But there are still some tariffs left in place. The across the board 10 percent tariffs, right?

ENTEN: Yes.

BERMAN: How do Americans feel about that?

ENTEN: Yes, all of a sudden, you know, it's like, oh, you know, we've - we're moving this - these tariffs and now everything's magically delicious. Uh-uh. Not the case.

I mean, look at this, tariffs of 10 percent or more on trading partners, favor, 39 percent, opposition, way up there, 57 percent. And, of course, these tariffs are still in place. Just because you remove some of them didn't mean that he removed all of them. You know, it was almost as if, well, I did a little something good, so everything's going to be OK. I don't think the American public is going to necessarily feel that way because there is big opposition to one of the biggest tariffs that still remains in effect.

BERMAN: The administration was super happy that the markets rebounded yesterday. The futures are down a little bit now, but they rebounded yesterday. The markets, in general, why might that not be the best measurement for this administration to track how voters really feel about it.

ENTEN: Yes, I mean, one of the reasons why you see the opposition to tariffs like this is, folks are afraid that prices are going to go up, right? And I guess the consumer index report was a pretty decent piece of news.

But this is the number one economic fear, right? When you ask it, what's your number one economic fear? Number one by far is the cost of goods at 47 percent, right. We're still coming off those highs on inflation. Number two, again, cost. It's housing cost. Number three. Then you finally get to the stock market, 17. Now, that's not too shabby, right, but it's nowhere near the 47 percent who say the cost of goods is the number one economic worry.

If prices go up, Donald Trump's approval rating will go down. I promise you that. Because that is the number one concern. And if these 10 percent across the board tariffs remain in place, I think most economists would agree that prices would, in fact, go up.

BERMAN: Last month, not yet. A reprieve when these new inflation numbers that are just out. But this is a warning sign for the administration going forward.

ENTEN: Yes.

BERMAN: Talk to us about the market drops that we had seen and put it in historical perspective.

ENTEN: Yes, I mean, you still got the 17 percent, right, that say that the stock markets their top economic worry. And more than that, yes, the markets did go up yesterday. But overall, drops of 5 percent or more at this point in the term, after inheriting a bull market, only one president in history since the S&P index became something back in 1957, it's Trump in 2025. There's still a nearly 10 percent drop in the S&P 500 over the course of his term. Just because there was a correction yesterday, it does not mean that the stock market is not still struggling over the course of his term so far.

BERMAN: Harry Enten, thank you very much for all of that.

ENTEN: Thank you.

BERMAN: Kate.

ENTEN: Two people who are feeling a lot of what you guys were just talking about right now are my next guests. Jessica Bettencourt is the president and CEO of Klem's in Massachusetts, which prides itself as being locally owned and operated since 1949. And Beth Benike, she is the CEO of Busy Baby out of Minnesota. Her company designs and manufactures baby products.

Thank you so much for being here, both of you. Your stories are very important to tell here, and to have your voices out there in the midst of this conversation.

Jessica, your store was founded by your grandfather 75 years ago. You sell a range of everything. I mean it touches almost every product SKU you could - you could think of. What do the tariffs, the 90-day pause on some tariffs, and now the even higher rate being put on Chinese goods, what does it mean for you and your business?

JESSICA BETTENCOURT, PRESIDENT AND CEO, KLEM'S: So, yesterday before the 90-day pause I was pretty much expecting just about all of our 70,000 SKUs to have probably price increases of some level. Even U.S. made goods a lot of times have components that come from somewhere else.

With the 90-day pause it - it kind of kicks the can down the road. It doesn't solve that question. It just makes it - makes that timeline for Q 3 and 4 that's really important to us, it's going to make that timeline shorter because we don't know what's going to happen in 90 days.

[08:45:10]

As far as the China tariff being increased, we know that there is significant amount of SKUs, I'm going to estimate probably 30 plus percent of those SKUs that we carry in - in some various categories that are really heavy in China specific SKUs that are going to just see massive increases. And we just aren't quite sure how we're going to handle all of this.

BOLDUAN: Yes, not quite sure seems to be the only honest way to answer any of this for anyone.

I mean, and, Beth, you just recently landed a deal with Walmart and Target. I mean that's huge for any small business owner. The White House - I say that in the context of how your world has shifted overnight. And what we're hearing from the administration is the celebration of the president's moves here. First the tariffs and now describing the pause as kind of - as a stroke of kind of strategic economic genius. We've seen - investors seem to be breathing a sigh of relief. Are you breathing a sigh of relief?

BETH BENIKE, CEO, BUSY BABY: No. No, not - not at all. The news yesterday is almost feels like the nail in the coffin for us.

BOLDUAN: Tell me why.

BENIKE: I have products in China right now, produced, ready to - to ship. They were supposed to get on a boat yesterday and - and come to America. And I can't ship them because, what would have cost me maybe $30,000 with a reasonable tariff, now is going to cost me almost $200,000. And I have to have that money when the products get to customs. And I don't have that. Nothing close to that. It's - it's not even reasonable. So, I have to leave my goods in China until I figure out some other

direction. But what that means is, when I run out of stock in two to three months, I no longer have products to sell, and no more revenue coming in, which means I can't pay my bills, can't pay my employees and everything I have, all of my debt, I have my house leveraged. We're a - we have five employees. My house is leveraged against our loans for our growth into Walmart and Target. I can't pay those bills. I don't even want to think about it.

BOLDUAN: Beth, how - how real is this threat and risk with this - just, I mean, it is just pure uncertainty for you right now. I mean thinking that you only have four months of inventory, that is terrifying.

BENIKE: Yes. And it's hard to make a decision. You know, we had an idea yesterday after the announcement of, well, maybe we can export to Australia, repackage the products and then reimport them from there. But because policy changes every 36 hours or so, I don't want to make that decision and make that move only for something else to change in just a couple more days. I don't - I'm paralyzed. I can't even make a decision right now. And I'm not the only one. There's thousands of us, small businesses, in this exact same position.

BOLDUAN: Yes, I mean, and, Beth, you can't see it, but Jessica's shaking - nodding her head at the very same moment because, Jessica, one of the stated goals, and I think both of you can speak to this, Beth is speaking to it already, is, one of the stated goals of this trade war was to bring more manufacturing back to the United States, have people buy more things from within the United States. Can you do that?

BENIKE: I can speak to that now because that's how I spent most of my day yesterday was -

BETTENCOURT: I mean, it would be wonderful - right.

BOLDUAN: It - I will both - I want both of you to respond.

BENIKE: Yes, I -

BOLDUAN: Yes, go - go ahead, Beth.

BENIKE: I mean, these overnight tariffs just don't even give us a chance to - a realistic pathway for us. For me, I would have to create - if I even found a factory in the U.S. willing to do it, that had the right machinery, it would take four to six months to get the tools made to even start production. And that alone would cost me over $200,000. I don't have the time or money to do that in this moment. We haven't - we don't have any time to make any adjustments.

BOLDUAN: Jessica.

BETTENCOURT: Yes, I think that's exactly right. I think Beth is absolutely correct, there are thousands of other small businesses, whether they're manufacturers or retailers, that do a specific category. I'm super fortunate. I carry products in a wide range of categories. And that helps me in a scenario like this.

But if you have that baby store, that toy store, or you are a manufacturer that is bringing your product in from China, you are facing some really difficult decisions right now. And there are not - there is just not a pathway for everyone to pivot and change and magically create this manufacturing that doesn't exist today.

BOLDUAN: Yes.

I could talk to you guys for hours.

[08:50:01]

I really appreciate you coming on and putting voice to this because it's very clear, consumers are facing the hit and you are in it with your customers all together in this moment of uncertainty. And I am really sorry that you're in the middle of this and facing this. But thank you for coming on and talking to us about it. I really appreciate it.

We're going to continue - we will continue to follow both of their stories. Jessica Bettencourt, CEO and president of Klem's, and Beth Benike, CEO and president of Busy Baby.

We're going to give you a live look right now inside the U.S. Capitol. See that podium right there? Any moment now we could be hearing from the House speaker, Mike Johnson. He's going to be speaking to reporters ahead of what now becomes an even more critical vote when it comes to President Trump's agenda and the budget they are trying to push through.

Also this morning, former First Lady Michelle Obama pushing back against rumors about a divorce that have been swirling. Why she says she's choosing to step away from some public events.

(COMMERCIAL BREAK)

[08:55:12]

BERMAN: All right, just in, 218 people are now dead at a nightclub collapse in the Dominican Republic, and authorities say rescue efforts are now over. Again, that death toll now at 218. It's unclear how many people might have been hurt after the nightclubs roof collapsed early Tuesday morning, or how many people might still be unaccounted for. There are bodies that are still unidentified.

Former First Lady Michelle Obama setting the record straight on her marriage amid rumors that had been swirling of a possible divorce. The former first lady was notably absent from President Trump's inauguration in January and the state funeral of former President Jimmy Carter, which had people speculating about the state of her marriage. Speaking with Sophia Bush on the "Work in Progress" podcast, she opened up about why she has stepped away from certain responsibilities.

(BEGIN VIDEO CLIP) MICHELLE OBAMA, FORMER FIRST LADY: They couldn't even fathom that I was making a choice for myself, that they had to assume that my husband and I are divorcing. You know, that - this couldn't - this couldn't be a grown woman just making a set of decisions for herself, right?

SOPHIA BUSH, HOST, "WORK IN PROGRESS" PODCAST: Right.

OBAMA: But that's what - that's what society does to us.

(END VIDEO CLIP)

BERMAN: The Obamas celebrated 32 years together in October.

Kate.

BOLDUAN: All right, so, this morning, the House is planning for another vote today to try once again to pass the Republican budget blueprint. The House speaker had to pull the vote last night in kind of dramatic fashion because of infighting within Rpublicans, because of Republican pushback. Pushback from a group of conservative lawmakers.

Now, ahead of the vote this morning, the House speaker is about to face reporters.

CNN's Lauren Fox on Capitol Hill with the very latest.

There seems to have been a lot that - we know a lot happened last night, and there seems to be a lot that has happened already this morning. What do you have, Lauren?

LAUREN FOX, CNN CONGRESSIONAL CORRESPONDENT: (INAUDIBLE) a couple of minutes is when the speaker talks to reporters. We expect that he's going to make some commitment to meeting a certain threshold of cuts with the Republican leader in the Senate, John Thune. This is, obviously, a really important step to try and get under control some of these rebellions that we're seeing from House conservatives who have been really concerned about the fact that there's such a huge discrepancy between the cuts that the House Republicans are committed to, which is about 1.5 trillion, and the cuts that the Senate budget blueprint is committed to, which is only about $4 billion.

Obviously, there was a lot of drama on the floor last night. They kept these votes open for a really long time as they tried to wrestle the votes. They just couldn't get there in the evening. They worked late into the night to try to find some way forward. It's not clear this is going to be enough to satisfy conservatives. But that vote is set for 10:00 a.m. this morning. So, obviously, we'll be watching really closely if this does the trick.

Kate.

BOLDUAN: All right, Lauren, standing by to standing by with you. Thank you so much.

John.

BERMAN: All right, this morning, as the Trump administration's immigration crackdown intensifies, some detained students and scholars are finding themselves at detention facilities hundreds of miles from home.

CNN's Gloria Pazmino is here with this story.

Good morning.

GLORIA PAZMINO, CNN CORRESPONDENT: Good morning, John.

That's right, we've been looking into these cases, these three high profile cases, Mahmoud Khalil, Rumeysa Ozturk, and Dr. Suri, he is the Georgetown fellow, and we found that all of them were detained near their homes here in the northeast and then transferred thousands of miles away down south.

Now, during that process, they were moved around different jurisdictions. And this is not just a matter of it being inconvenient. Their lawyers are all working to get them released, but they haven't been able to do that because they're in the middle of these jurisdictional battles.

So, remember, none of them have been charged with a crime. And so far what they've experienced is this moving around and also really negative conditions in the places where they are being held. We learned that Dr. Suri was denied religious accommodation, halal food, he was given dirty underwear to wear while he was - where he was being detained. So, this is about a lot more than just not having access to them.

Now, ICE says that this is just a question of facility availability and where they have space to hold people. But their lawyers say that it's a very purposeful attempt to venue and judge shop, hoping to end up in the Fifth Circuit of the Court of Appeals where they believe the judges will be friendlier to the Trump administration.

One of Khalil's attorneys told me that the Fifth Circuit is where the law goes to die, and they believe that's the reason why they're being transferred down south.

BERMAN: Meanwhile, there are students who have had their student visas revoked. How many are we talking, and what does this all mean?

PAZMINO: Yes, we're talking about hundreds of people, John. In the last several days we've been trying to count.

[09:00:00]

More than 345 scholars, students, faculty members have had their visas revoked.

But behind those numbers there's a real effect.