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U.S. Economic Growth Declines; Rep. Kevin Kiley (R-CA) is Interviewed about the Economy; White House Violated International Students; Larry Summers is Interviewed about Harvard Report, Aired 9- 9:30a ET

Aired April 30, 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]

SARA SIDNER, CNN ANCHOR: Breaking this morning, brand new numbers just out on the state of the economy, giving us our first major glimpse of the impact President Trump's sweeping agenda is having. And it's throwing things into reverse. A key report showing the economy shrank during the first three months of the year. The GDP declined at an annualized rate of 0.3 percent. The first drop in three years.

A live look at the stock futures right now. And you see them reacting, all of them down less than 30 minutes from the opening bell on Wall Street. We'll likely hear more about this from the president when he convenes a cabinet meeting later this morning.

CNN's Alayna Treene joining us now from the White House.

There were some expectations that this wasn't going to look good, but this is particularly bad.

Any initial reaction that you've heard coming out of the White House yet?

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: We have not heard anyone from the White House or the Trump administration respond to these new numbers, Sara. But as you mentioned, I do think, of course, he's going to be pressed on this by reporters when he convenes a cabinet meeting later this morning around 11:00 a.m.

And just to get back into that. I mean it contracted the GDP for the first time in years. And this is something that many economists were warning about, particularly, of course, given the concerns among consumers, but also businesses in the fallout of the tariffs that the president has implemented on different countries.

Now, I think there's no - you know, it's no surprise that right now one of the central challenges facing the president and his White House is the economy. You know, as he's been taking a victory lap around his 100 days in office, the economy is still a key point of frustration for many people behind the scenes here. And part of that is because, again, the tariffs and the response in the markets, but also from other countries, is not really where they want it to be. And you see some of that in some of the public comments you're hearing from some of the president's top economic advisers, from Treasury Secretary Scott Bessent and others. They are under immense pressure right now to try and give some sort of good news as it relates to the economy. That's why you're hearing them try to tout a potential deal, a trade deal with India. They believe, they say, that it could be struck as soon as this week or next week. They're trying to tout other deals and other conversations that they are talking about with countries. But we haven't really seen any tangible results yet from the tariffs that the president has laid out. And so, again, a key frustration here.

Now, one of the key areas, of course, that this is most concerning is as it relates to China. I mean, as of now, it's clear that the president has not been talking with Chinese President Xi Jinping when it comes to this. And it doesn't seem like there's been any real significant talks with Beijing on how to get out of this escalating trade war with them, while China, of course, appears to be dug in and willing to wait out the United States on these tariffs.

Now, the president was asked about this last night during an interview with ABC News. Listen to that exchange.

I'm not sure - looks like we don't have the sound, so I'll just give you some of that exchange.

Essentially, the president said, you don't know whether or not China is going to eat it. He said China will probably eat those tariffs, pointing out that at 145 percent tariff on Beijing, they basically can't do much business with the United States.

What the president was essentially trying to say there, Sara, is that at such high duties that the - that China is facing right now from the United States, they believe, the United States, this Trump administration believes that China will ultimately need to buckle under that pressure. And what we heard the president kind of do throughout that interview with ABC was reassure Americans that the economy will ultimately even out, even as he's been saying even recently on social media that Americans need to hang on, and noting that there is still going to be some short term pain during what he calls this transition period.

SIDNER: It will be hard to reassure Americans when they're looking at these numbers.

Alayna Treene, we will see what the president says, if anything, about this coming up in a bit. Thank you.

John.

JOHN BERMAN, CNN ANCHOR: All right, with us now is Congressman Kevin Kiley, a Republican from California.

Congressman, thank you so much for being with us.

So, GDP down 0.3 percent in the first quarter. It was a growth rate of 2.4 percent in the final quarter of last year. The first contraction since 2022. What do you think this data is telling us? REP. KEVIN KILEY (R-CA): Well, I think that it's natural when you have

a lot of change there's going to be short term disruption. But I think that when you dig deeper into the data, you see a foundation for medium and longer term growth. So, for example, you see investment, which is tied to jobs and to growth, that it's up 22 percent. And then we still, as - as Congress, have - have yet to act in terms of extending and adding to the tax cuts from 2017. And what we saw when those passed in 2017 is that led to significant economic growth. And I'm very confident that the same thing will happen here.

BERMAN: Just a few data points here. You call it a short-term disruption. One of the things we did see was companies loading up on imports because they're concerned about the impacts of tariffs.

[09:05:04]

This report doesn't even cover really the impacts of tariffs. The president's announcement wasn't until the beginning of April. People think that there could be even more headwinds in the second quarter there. You called it a short-term disruption. How much pain do you think Americans will have to endure?

KILEY: Well, it's important to also note that some of this came from just the - the relaxation or the lower amount of government spending. And so that's actually a good thing in some sense as we're cutting waste, fraud and abuse. And Americans broadly agree that we need to reduce the size of government, we need to reduce the deficit, we need to eliminate waste, fraud and abuse. We need to get government down to its proper size and get it to function more efficiently. So, those numbers, those kind of top line numbers that you're citing are partially a reflection of that.

But again, when you dig deeper, you see an increase in exports. You see an increase in investment. And we have this huge runway now where we're going to be taking action very soon as a Congress to extend the prior tax cuts and to provide new forms of tax relief, which is going to be an added fuel for investment and jobs.

BERMAN: Core prices, you know, were also up greater than expected. You keep saying, if you dig deeper this looks OK. Are you saying this is a good report?

KILEY: I'm saying that the signs are there for significant economic growth going forward. And I think that we have all the tools at our disposal and - and are on the track to do just that.

BERMAN: All right, I want to ask you about immigration now, and specifically the case of Kilmar Abrego Garcia, the man deported to El Salvador who administration lawyers say was deported there by accident. The administration has said in court that it can't get him back. The president was asked directly about this by Terry Moran from ABC last night. I want to play that exchange.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: This is not an innocent, wonderful gentleman from Maryland.

TERRY MORAN, ABC NEWS: I'm not saying he's a good guy. It's about the rule of law. The order from the Supreme Court stands, sir.

TRUMP: He came into our country illegally.

MORAN: You could get him back. There's a phone on this desk.

TRUMP: I could.

MORAN: You could pick it up.

TRUMP: I could.

MORAN: And with all the power of the presidency, you could call up the president of El Salvador and say, send him back. But, no.

TRUMP: And if he were the gentleman that you say he is, I would do that, but he's not.

MORAN: But the court has ordered you to facilitate that - his release.

TRUMP: I'm not the one making this decision. We have lawyers that don't want to do this, Tarry.

MORAN: You're the president. Yes, but - but the buck stops in this office.

TRUMP: I - no, no, no, no. I follow the law.

(END VIDEO CLIP)

BERMAN: Again, you're a lawyer. The administration has argued in court it can't get him back. The president was just making a statement that he could. So, if you're a judge overseeing this case, how are you supposed to interpret that?

KILEY: Well, maybe you heard the clip differently. I mean the Supreme Court has said that the administration needs to facilitate his return. And so, if they wanted to send him back, then compliance with the court order would entail facilitating his return.

But again, we're fixating on this one guy who, as the president said, came to the country illegally, had ties to foreign criminal organizations. During the Biden-Harris administration, we had 10 million illegal immigrants come into this country. We've never seen anything like it in the history of this country. Were not vetted at all. Two million of them were never even processed. They were known as got-a-ways.

And one consequence of that is you had a backlog of 4 million cases in our immigration courts. And so, our ability to provide efficacious and fair due process to those who are facing deportation has been severely limited. And one of the things we're doing today in the Judiciary Committee is to provide the administration resources to be able to fully staff our immigration courts. We have 700 immigration judges in this country. Some of them don't

even have courtrooms right now. So, we're going to hire more judges. We're going to get them more courtrooms. We're going to hire more ICE lawyers. We're going to provide more ICE personnel. And we're going to provide the resources that are necessary to have a fair and efficacious administration of our immigration enforcement.

BERMAN: Look, and I know you do care deeply about the law. That's why I'm asking you here, and I'm not asking about the Supreme Court, what they ordered. I'm asking you what the president said here. He said he could pick up the phone to get Abrego Garcia home. He said he could. Do you think he can?

KILEY: If the president - if the president of El Salvador said that this guy's going back, we're sending him back, then the court order suggests that the president should facilitate his return.

BERMAN: I'm saying, do you think the president can get him back?

KILEY: I mean, I'm not sure that the Supreme Court said he needs to be making phone calls, you know, trying to - to get people back in the country. They said facilitate his return. And I'm not a lawyer for the administration, but he's getting legal advice on what that word means in the context of this court order.

BERMAN: Congressman Kevin Kiley, from California, appreciate you coming on CNN NEWS CENTRAL. Please come back again. Nice talking to you.

KILEY: You bet. Thanks for having me.

BERMAN: Kate.

KATE BOLDUAN, CNN ANCHOR: There is new CNN reporting about the Trump administration's crackdown on international students and how any type of contact with law enforcement led some to be labeled as criminals without actually anyone checking to see if it was true.

Plus, Harvard is now promising change after scathing internal reports about anti-Israel, anti-Arab hate on campus.

[09:10:06]

What is Harvard going to do about it now as this is the core issue behind the White House's attacks against the school.

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SIDNER: (INAUDIBLE) are demanding answers from the Trump administration after thousands of international students had their records changed in databases. They were effectively designated in the U.S. as criminals with little to no evidence of that or actual charges.

[09:15:08] With their records changed, though, they were barred from classes and work, and some students have even left the United States. Now a judge is calling out the administration, saying it's a blatant due process violation.

CNN's Shimon Prokupecz broke the story for us.

Shimon, what did you find as you were looking through all this?

SHIMON PROKUPECZ, CNN SENIOR CRIME AND JUSTICE CORRESPONDENT: So, there's been a lot of court cases, a lot of lawsuits that students have filed, hundreds at this point of students that have filed lawsuits, trying to really ultimately prevent the administration from deporting them. And after all of these lawsuits and judges started asking questions and putting pressure on the administration, particularly in Washington, D.C., the administration has backed down and changed this. What they did was how they went about changing the status of these students in the - in a DHS computer that ultimately allows foreign students to come to this country and learn in this country and attend the colleges in this country.

So, at some point, someone had this idea that, let's go through this system, which has 1.3 million foreign students in it, let's take all those names, put it into the database where criminal records are kept, which is the National Crime Information Center, the NCIC, and let's see what hits we get. And they got a lot of hits. But the problem was, the people that they were hitting on were people that were never convicted of crimes, people whose cases were dismissed, who ultimately were never charged. And, out of all of the things that they found, it was all very low level stuff. In some cases, speeding ticket, you know, reckless driving, DUI, things that eventually were either dismissed or there was some kind of remediation. And so, they had sealed records. Their records were clean. But the consequences of all this was that students, the colleges, freaked out and they told students that they had to leave the country. And some students did.

SIDNER: Yes.

PROKUPECZ: They were so afraid that they were going to get detained by ICE that they all - a number of them left the country.

SIDNER: We also saw the administration grabbing people, at least one student or two off the streets. But the Trump administration, you said, is now backing down. What does that mean?

PROKUPECZ: So, it's this SEVIS record. So, what happens is, it's essentially a system that was created after 9/11 that allows kind of to have students, foreign students, to have status in this country so that they could attend the colleges.

What they did was they started terminating students from the SEVIS and notifying the colleges that they were terminated from these records. Thereby, for the colleges, they were like, OK, well, they're out of status, so they have to leave the country. The colleges were also freaking out because of the pressure that they're getting from the administration. SIDNER: Right.

PROKUPECZ: And so now they have reversed that and said, no, no, no, no, they don't have to leave the country. They could continue their education. And so many of them are now having their status reviewed. And sort of they - they're now changing. So, they sort of said, OK, you're fine for now.

But this is not over because the lawsuits are still continuing. The judges want to know how this happened, why this happened, because it has affected so many of these students who have spent years in this country paying their way through very expensive universities. And what happens? So, all of a sudden the administration says, no, you can't do this anymore. And now what?

So, the lawsuits are continuing, and I suspect there's going to be a lot more information that's going to come out in these lawsuits. And I think part of what has happened, the administration has said, oh, we better change course here because the judges are putting pressure on them and more information is going to come out.

And there are questions, so many questions of whether or not this was legal. So that is all still to be determined. But it's not going away. I mean these students are going to continue to fight.

SIDNER: Right, you digging through this. But some of the students have already left. So, there are certainly some of the students that are just having a very, very hard time dealing with what happened to them, although the fight continues in court.

Shimon Prokupecz, great job. Thank you.

PROKUPECZ: My pleasure (ph).

SIDNER: Appreciate it.

Kate.

BOLDUAN: Also this morning, Harvard is promising change after a task force released scathing internal reports about the university and life on campus. One report on how anti-Semitism and anti-Israel bias have been handled, and another on anti-Muslim, anti-Arab and anti- Palestinian bias, how it's been handled on campus.

Here is how the student newspaper this morning laid out some of the experiences that students allegedly faced. This is in hundreds of pages in the compiled in this report. This is what is - how it's described, "being yelled at, spat on, called derogatory names, taking Ubers for fear of harassment on the street, dropping classes to avoid hostility, or anti-Zionist bias. Racist, anti-Semitic and Islamophobic jokes."

Now, Harvard's president has apologized in a letter to the campus following the release of this, calling the 2023-24 academic year, quote, "disappointing and painful." Joining us right now is Larry Summers, a former president of Harvard.

Also, of course, Treasury secretary under President Clinton, director of the National Economic Council for President Obama.

Let's - we're going to lean on all of your - all of your hats and your resume, Secretary.

First, on this report.

[09:20:01]

You've been outspoken both in calling out Harvard for not doing enough, especially post-October 7th, and also taking on the Trump administration for trying to step in. What is your reaction to what comes, what's coming out in this report and where you think it goes?

LARRY SUMMERS, FORMER PRESIDENT, HARVARD UNIVERSITY: This is a searing report. It says what many of us have known for a long time, particularly that there are real issues of anti-Semitism on the Harvard campus. And it proposes in quite constructive ways a variety of steps that should have already been taken to address that anti- Semitism.

I've been encouraged, by the way, the Harvard administration has replaced problematic leadership in our Middle East studies center, closed certain programs that were really political activism rather than scholarship, that it's tightening a variety of disciplinary pressures. But there's much more that our leadership is going to have to do to shape a culture that, as President Garber said, does not abide bigotry. And that's going to be a large challenge for Harvard's leadership.

I think it's legitimate for the government to have concern over what is a civil rights issue. What's not legitimate is to behave in an entirely extralegal way, cutting off funding without any kind of hearing. Cutting off funding for cancer research because there's bad activities in the divinity school, failing to give notice in the ways that are prescribed by the statute, venturing into areas that have nothing to do with anti-Semitism or civil rights, like the ideological disposition of members of the faculty.

So, the Trump administration is way out of line with respect to law. The concerns about Harvard having a civil rights issue around anti- Semitism are real. There's been constructive action. This report is useful. But there's much more that needs to be done.

BOLDUAN: Yes. And also this morning, turning now to the economy, the U.S. economy just had its worst quarter since 2022 we've learned. GDP, well, one coming in weaker than expected, and also seeing this dramatic falloff from the fourth quarter. What are we looking at here, Secretary?

SUMMERS: Look, this has probably been the least successful first hundred days of a presidency on the economy in the history of - in the last century. We've seen the stock market go down by as much as ever. We've seen the dollar go down more than ever. We've seen forecasts of unemployment go up. Forecasts of inflation go up. Forecasts of the odds of recession go up. We've seen consumer confidence collapse. We've seen businesses take back all their previous earnings projection.

So, this has been a disastrous hundred days for the U.S. economy. And what makes it more disastrous is it's not something that's happening in markets. It's not something like an external shock, like a hike in the oil prices. It is all the consequence of policy announcements by the president of the United States, principally with respect to tariffs that have created immense amounts of uncertainty, immense amounts of question about whether to buy American goods. This is the quintessential self-inflicted policy wound.

When markets have behaved well, it has not been because anybody has made a favorable judgment on these policies. It has been because people have seen increased hope that the administration would switch course. There's a market where people can make judgments about the odds of recession. It spiked up this morning and is now saying that there's a seven in ten chance of recession this year. That chance was less than one in four just 100 days ago when the president was inaugurated.

What we need is to change course, to set a new, steady course away from tariffs as the central element in U.S. economic strategy.

[09:25:13]

Until we have that in place, I fear that our economic situation is only going to deteriorate. Consumers are going to see higher prices from everything from the clothes they buy, to the houses that - to the repairs they want to do on their houses. We are going in the wrong direction as a country economically right now.

BOLDUAN: Yes, as Mary Barra, of GM said just last week, consistency and clarity is what - is what she needs, that's for sure. And you can - you can assume a lot - a lot of people feel exactly the same way when they look at the GDP report coming out.

Secretary, thank you for your time.

SUMMER: It's an almost universal pattern.

BOLDUAN: Thank you so much, sir.

John.

BERMAN: Along the lines of what Kate was just talking about with Secretary Summers, we are standing by for the opening bell on Wall Street right now. You can see, futures, they turn downwards when the GDP report came - came out just a short time ago. We'll see where they head when the bell rings.

Stay with us.

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