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Sean 'Diddy' Combs Trial Begins; Hamas Releases American Hostage; Trump Backing Down on China Tariffs?. Aired 1-1:30p ET

Aired May 12, 2025 - 13:00   ET

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

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BRIANNA KEILAR, CNN HOST: A thaw in the trade war between China and the U.S. sending the markets into overdrive, investors thrilled to hear tariffs could be slashed. We will look at what the two countries agreed to.

BORIS SANCHEZ, CNN HOST: Plus, witness testimony in the federal criminal trial of Sean "Diddy" Combs could begin today in New York City. The music mogul facing life in prison. Opening statements wrapped up in the last hour. We're going to break down the arguments.

And CNN speaks with new Pope Leo XIV, as the pontiff settles into his historic role, the first American to lead the Catholic Church.

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

We begin this afternoon with some breaking news out of the Middle East, where the last known living American hostage in Gaza is now free, Hamas releasing 21-year-old New Jersey native Edan Alexander just over an hour ago, this the first image we're seeing of Alexander as he was handed over to Red Cross officials and is now in the hands of the IDF, as he's about to be transported to a hospital where he's going to be evaluated and ultimately reunited with his family.

KEILAR: Edan Alexander had been held captive for more than 580 days. He was serving in the Israeli military when he was kidnapped by Hamas militants on October 7, 2023.

And his release comes as President Trump is on his way right now to the Middle East for his first major international trip this term. Alexander's family says President Trump has invited Edan and his family to meet him in Qatar.

With us now to talk more about these developments is Dana Stroul. She's a former deputy assistant secretary of defense for the Middle East.

Dana, thank you so much for being with us. Obviously, great news for this release. How does Edan Alexander's

release play into the ultimate goal of a cease-fire?

DANA STROUL, FORMER U.S. DEFENSE DEPARTMENT OFFICIAL: Well, first of all, just such good news for the family. Such a relief.

The U.S. team has been working hard on this. What is interesting about this one is that Hamas essentially did it without conditions, basically as a deliverable for President Trump as he gets on the airplane to the Middle East.

And, at this point, Israel is completely resistant, according to Prime Minister Netanyahu, for anything related to a broader cease-fire, although other late-breaking news is that an Israeli team is heading back to Qatar right now to resume negotiations that Qatar and Egypt have been facilitating to get all of the remaining hostages out of Gaza in exchange for a longer cease-fire.

KEILAR: Do you think part of Hamas' calculus here is, if American prisoners are not in Gaza, they may face less pressure inadvertently, right, from the pressure that the U.S. might put on Israel?

STROUL: Absolutely. At the end of the day, Hamas is a terrorist organization and is behaving like a terrorist organization.

So, even though this is so wonderful for the Alexander family, at the same time, it's a cynical play where Hamas is trying to drive a wedge between Israel and the United States.

Right now, Hamas looks like it's reasonable. It's positioning itself to look like it gave a gift to Trump to relieve pressure on Hamas, when it's Hamas who's holding the rest of these hostages, refusing to demilitarize and leave Gaza.

KEILAR: We also should note, as President Trump heads to the Middle East right now on this trip, Israel is not a stop included on it. What do you make of that?

STROUL: Well, first of all, I think this trip is about economic deals and investment deals and what the Gulf can do for the United States.

So Trump is going to Saudi Arabia, to the United Arab Emirates and Qatar because all of these monarchies have pledged hundreds of billions, if not trillions of dollars for investment deals in the United States. And for Israel, these Gulf monarchies are really frustrated with Netanyahu and his government for not being willing to take steps, in their view, that would lead to an end to this horrific war and end the suffering of Palestinian civilians.

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So what's happening in the last couple days here is that it's putting Netanyahu in the hot seat, rather than Hamas.

KEILAR: Yes, this blockade that we have seen and the conditions in Gaza, we always talk about how they are terrible, but they have deteriorated really to kind of an unthinkable level.

What might this release of Edan Alexander -- will this have any influence, do you think, on getting aid into Gaza?

STROUL: Well, what we understand about this deal is that there will be some aid delivered.

But that's what Steve Witkoff, Trump's envoy, has promised to Gaza and to the Palestinian people. The Israeli government said they're going to have no role in facilitating that humanitarian aid. And the IDF is present all throughout Gaza and is saying that they're going to stay there for another year and reoccupy parts of Gaza.

And the challenge with getting aid directly to the Palestinians in Gaza who need it is that Hamas is still in some kind of a governance position and can manipulate and divert the delivery of humanitarian aid, which is a really, really difficult issue set.

And we know that the United States, Israel and now the United Nations are trying to work out a way to get that aid to the people who need it without inadvertently benefiting Hamas.

KEILAR: Yes, it is a very difficult problem that they are facing there.

Dana Stroul, thank you so much. We really appreciate your time today in the middle of what seems like a rare positive headline out of Gaza.

Stocks soaring right now after the world's two largest economies agreed to tone down their trade war, the U.S. and China announcing they will temporarily slash tariffs on one another after they met in Switzerland over the weekend. The U.S. is cutting tariffs on Chinese imports from that staggering 145 percent down to 30 percent.

China will slash its levies on U.S. products from 125 percent to 10 percent. The lower tariff rates will be in effect for 90 days.

SANCHEZ: Officials from both sides say that talks will continue throughout the pause, in hopes of coming up with a long-term trade agreement.

CNN's Alayna Treene is live for us at the White House.

And, Alayna, White House officials are calling this a deal, but it's sort of a temporary deal, in lieu of a longer-term deal, right?

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Yes, look, I mean, it was clear that the White House wanted to frame this as a win.

And that's exactly what President Donald Trump did this morning, as did his Treasury secretary, Scott Bessent, when they both addressed reporters. Now, this 90 days is really going to be the time when they have to work out a longer-term agreement. One reporter actually asked the president in the Roosevelt Room this morning when he was doing an event on drug prices, if you can't get a deal with China, will these tariffs go back to 145 percent? The president said, first of all, he believes that they will be able

to reach a deal, but also that tariffs would increase in the event that they can't ultimately reach a real, more lasting trade agreement, but they would still go higher, not to the 145 percent, but still higher.

And so, look, there's a few things, I think, that are very important to note here, Boris and Brianna. One, of course, is how much different a change in posture this is. Just a week ago, the president was saying that he believes his trade war with China was good for the United States, that he believed that, as long as they weren't losing money to China, he kept reiterating how unfair trade practices were, then the U.S. was winning.

That is very different rhetoric than what we heard from the president this morning, really trying to paint a more optimistic picture of the United States-China relationship. I want you to listen to what he said.

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DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The talks in Geneva were very friendly. The relationship is very good. We're not looking to hurt China. They were very happy to be able to do something with us. And the relationship is very, very good.

I will speak to President Xi maybe at the end of the week. We have some other things we're doing.

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TREENE: So there, I think, is also notable. He said he may be -- he might be speaking to Chinese President Xi Jinping at the end of the week.

The other notable thing about just, again, the kind of significance of this deal, one, of course, as I mentioned, was one that many people didn't think they would walk away with so quickly after this weekend, is that this was the first time Washington and Beijing actually sat down, let alone -- I mean, they did sit down in person.

But it's the first time they even spoke via the phone since the president's tariffs on China went into effect. So it's pretty remarkable how quick this happened and how big of a jump, 145 percent to 30 percent, that was.

Now, all of this comes Boris and Brianna, as our colleague Jeff Zeleny is reporting that the White House had really been looking for an off- ramp for some time with China. Of course, the president had really made Beijing the example of the country they wanted to hold accountable, right? All of these other countries, they lessened the tariffs to 10 percent, but they kept this staggering fee on China, trying to argue that they were the most unfair country and trying to make an example of them.

[13:10:06] Again, what we're hearing now behind the scenes is that really the president wanted a deal out of these talks in Geneva over the weekend and he really wanted to head to the Middle East with a win on China -- Boris, Brianna.

SANCHEZ: Alayna Treene at the White House, thank you.

Let's talk about what this means for consumers with Justin Wolfers. He's a professor of economics and public policy at the University of Michigan.

Justin, great to see you, as always.

Your reaction to this deal to come up with a longer-term deal later?

JUSTIN WOLFERS, UNIVERSITY OF MICHIGAN: Let me give you a short-term reaction and a longer run.

The short-term reaction is, this is very good news. Tariffs on China were previously so high, it was effectively embargo. We don't actually have to travel to Geneva for the U.S. government to decide to cut the rate at which it taxes Americans for importing goods from China, but I'm glad that it did, and it's going to create a whole lot of calm for the next few days.

The medium-run thing to worry about is, at the moment, the half-life of a tariff announcement from the White House is around six to eight days. So, as encouraged as I am that this is the movement -- the direction in which it's moving, I'm not sure that we -- that businesses can be confident that we're going to hit the more harmonious times that we had prior to this administration.

SANCHEZ: The director of the National Economic Council, Kevin Hassett, says that China made certain concessions when it came to allowing U.S. exporters to enter the Chinese market or certain aspects of the Chinese market.

I wonder what you make of that. Is that a win that the White House can point to justify levying these tariffs to begin with?

WOLFERS: Oh. Well, it's not a win and it's not a justification, but, more to the point. When the White House says we got some concessions, but I'm not telling you what they are, they told us this about the Britain-U.K. deal, and it turns out Britain-U.K. -- sorry, the U.K.- U.S. deal...

SANCHEZ: Yes.

WOLFERS: ... that was actually not a deal. It was an agreement to have an agreement at some point in the future.

So, if it's not written down and signed and they're not willing to show us that, then I'm not sure I believe it.

SANCHEZ: I do wonder what you think might make some of these tariffs worth it, in other words, what your guideposts are for justifying the trade war that this White House has launched.

If they do in fact make it so that supply chains are reconfigured and the U.S. is less reliant on China, as Treasury Secretary Scott Bessent is suggesting the administration will continue to pursue, do you see that as a win?

WOLFERS: Boris, let's not tie ourselves up in knots trying to make sense of something that we can't make sense of.

Look, every time the administration has moved towards more tariffs, the markets have fallen. They're very unhappy about this. They think it undermines the profitability of American business. Every time the administration walks back, markets cheer. They think that that's useful economic policy, as does most of the economics establishment.

Look, the long-run damage here is really worth emphasizing. Let me take you back. Remember, during COVID, global supply chains became fractured, and there became a lot of talk that what we needed was more robust, reliable supply partners. There was talk of onshoring and friendshoring.

Well, this time, something similar is happening, but it's happening in other countries. And it's not caused by a virus. It's caused by the White House. The United States has shown itself to be an unreliable trading partner. And more to the point, its tariff policies change day to day and week to week.

And, as a result, our foreign trading partners are looking for more robust, more stable, more reliable trading partners. And so already they're starting to diversify away from the United States.

SANCHEZ: If the next dozen-plus deals look like what's been struck between the U.S. and the U.K. and the U.S. and China, what do you imagine this is going to do to the global economy? Is it actually going to effect some great change?

WOLFERS: Not much.

So let me characterize the British deal because I think it's the one that sets the standard for the rest of the world, except for China. The British deal is basically the U.S. has decided, President Trump has decided, in fact, the tariffs on every other country around the world will be 10 percent.

I want you to put that on a big sheet of paper. Let's make it 48-point font. And next to that, there's a little asterisk. The little asterisk says, if you're willing to come to the Rose Garden and put on a dog- and-pony show and make the president feel good, we will make a few little carve-outs for you as well.

And when you look at the details of the British deal, the 10 percent is the most important part. The asterisks turned out to be incredibly small. There really were no economically important carve-outs.

And so I think other countries around the world right now are looking at this and they're understanding that the U.S. government doesn't want Americans buying stuff from them. And so they may be looking elsewhere for trading partners.

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SANCHEZ: One last question, Justin. On Trump's executive order today, this most favored nation model for tying U.S. drug prices to what they cost in other countries, can that idea work?

WOLFERS: Right. So let me explain it to the viewers first.

It basically says, the U.S. says, we will only buy the drugs if you will sell it to us at the lowest price you charge anyone else. So what that means is, U.S. drug prices may be set in, for instance, Sierra Leone. Well, two observations about that.

The first is, do you think that drug companies are therefore going to lower the prices on Americans to Sierra Leone levels, or do you think they're going to take Sierra Leone's drug prices and bump them up? I'm guessing it's the latter. And so there's not really a lot in this for American consumers.

The second thing to realize is what this means also is that we are effectively outsourcing our pricing of drugs to Sierra Leone. Do you think that Sierra Leone is setting its drug prices in such a way as to maximize the sorts of R&D and development and drug development that we Americans want? My fear is that we're not, in which case this could end up hurting the health of all of us.

SANCHEZ: Justin Wolfers, always appreciate you sharing your perspective. Thanks for joining us.

WOLFERS: It's a pleasure.

SANCHEZ: Still ahead, we're following the start of the federal sex trafficking trial of Sean "Diddy" Combs, the prosecution beginning its case by detailing graphic evidence of alleged assaults, rapes and druggings.

Plus, Pope Leo meeting with reporters for the first time. CNN's own Christopher Lamb was there. See him shaking hands with the pope? We're going to talk about this meeting in just a moment.

KEILAR: And then later: The problems persist at Newark. The airport just suffered its third air traffic control outage. We're standing by for a press conference.

These important stories and more all coming up on CNN NEWS CENTRAL.

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KEILAR: Just minutes from now, the prosecution in Sean "Diddy" Combs' criminal sex trafficking trial is expected to call its first witness.

Both sides gave their opening statements today, just moments ago, prosecutors painting the music mogul as a serial abuser who allegedly coerced, drugged, and forced victims to engage in sex acts for days at a time. They also described Combs as the head of a criminal enterprise whose inner circle helped him commit crimes for decades and worked to cover it up.

SANCHEZ: In the defense's opening statement, they described Combs as a -- quote -- "complicated man," adding -- quote -- "This case is about love, jealousy, infidelity, and money," and that "This case is about voluntary adult choices made by capable adults in consensual relationships."

Julie Grant joins us now live. She's a Court TV anchor and former prosecutor.

Julie, thanks so much for being with us.

So, these opening statements, the prosecution highlighting the issue of power, saying that, in the case of Combs' ex-girlfriend Cassie Ventura, only one of them had power, only one of them had control, and that was the defendant, that was Combs. Why is that question of the power dynamic central to their case?

JULIE GRANT, COURT TV ANCHOR AND FORMER PROSECUTOR: Boris and Brianna, thank you so much for having me. Good afternoon to you both.

It's key because, in domestic violence situations, a lot of people think it's about anger management. Domestic violence is not. It's about power and control. It's about batterers exerting control over their victims through means of violence, and, a lot of times, through emotional abuse, financial abuse, all sorts of things.

And so, here, that's largely at the heart of this case for both sides, as we have seen in the opening statements. We're seeing the federal government, as expected, alleging that Sean "Diddy" Combs had an enterprise and that he was using the whole business enterprise to coerce individuals who would be unwilling to engage in certain sexual behaviors or unwilling to be transported for such. So all of it is coercive and criminal, according to the federal government.

But, on the flip side, we see the defense team embracing domestic violence here, trying to curry some favor with the jury by acknowledging that Sean Combs is an imperfect person, and, yes, what he did to Cassie is indefensible in terms of the battery that occurred, but they're saying that that was it, that it didn't go beyond domestic violence in that relationship, that there was no racketeering, there was no trafficking, there was no transportation of anybody for any illegitimate purpose.

So this should be quite a fiery case, as you both know, Brianna and Boris, with Diddy's liberty and legacy at stake.

KEILAR: Yes.

And it's interesting because the defense is really confronting some of these things head on, right, the really sensational elements of this. "You are not here to judge him for his sexual preferences," as they acknowledge that there are going to be videos of these alleged sex parties, saying: "You may know of his love of baby oil. It's not a federal crime."

I wonder what you think of that defense and how a jury might engage with that.

GRANT: That's such an excellent question, Brianna.

That approach kind of takes the sting out of the government's case by saying to the jury in opening statements, look, our client's sex life is being put on trial here, that he may have had some preferences that wouldn't be for everybody, that maybe he loved baby oil maybe more than the average person, but that doesn't make him a criminal. It doesn't mean that he was forcing people to engage in these extenuous sex parties, where drugs were allegedly involved and force and physical abuse were involved.

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They're kind of chipping away at what the government is going to be bringing to this jury, in a sense. So, by getting ahead of it and acknowledging that he did act as an imperfect person, that he did commit a battery on Cassie in that video that we all saw thanks to the great reporting done by CNN, by acknowledging all of these things, the defense team earns a little bit of trustworthiness with the jury going forward, Boris and Brianna.

SANCHEZ: I wonder what you make of the defense here posing Cassie's behavior as being consensual.

I mean, they're arguing that she made a choice every single day for years to stay with Combs and that, when she made the decision to leave, there were no repercussions, as the prosecution has hinted.

GRANT: I think that's a slippery slope.

I love that question, Boris, because with the federal government will do is bring in a domestic violence expert, because, for anyone who's never been in a relationship with intimate partner violence, one may not understand how difficult it is to leave, that leaving isn't as easy as it seems.

And, sometimes, it's actually safer to stay than to leave, unless one has a protection plan in place to get out of a relationship that's abusive safely and move forward without contact and hopefully without any repercussions.

So I think that what's what's going on here is that this is going to be a slippery slope by the defense team trying to say that Cassie wanted or consented to any of this, especially because we have the proof, the proof, thank goodness, that CNN first published that everybody's going to get to see.

I think it's going to be the most critical piece of this case. And I will tell you why. When it comes to the evidence, it's not just the battery that that video shows us. It shows us false imprisonment. It shows us how she was trying to escape from him, and he brings her back to that hotel room. To me, I think that is going to be the linchpin of the government's

case when they try to prove that this was coercive and criminal conduct that Sean Combs engaged in.

SANCHEZ: Julie Grant, appreciate the point of view. A lot more to discuss as this case goes on. Thanks for joining us.

Coming up, we have much more on the trial of Sean "Diddy" Combs, including what we know about the makeup of the jury.

KEILAR: Plus, a Democratic lawmaker accusing the Trump administration of intimidation after a tense encounter with ICE. What she says led up to this heated exchange and ultimately the arrest of a New Jersey mayor.

Stay with us.

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