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Fed Hikes Interest Rates By 0.5 Percent to Combat Inflation; Ukrainian Forces Retake Kharkiv Oblast Village of Molodova; Biden on Roe v. Wade Overturned: What Will Be Attacked Next? Aired 3-3:30p ET

Aired May 04, 2022 - 15:00   ET

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

[15:00:03]

KYLIE ATWOOD, CNN NATIONAL SECURITY CORRESPONDENT: They said that President Biden demonstrated a willingness for sustained engagement on this issue. Of course, it's a challenge because the United States and Syria don't have normal diplomatic relations but what they are saying is that there needs to be negotiations to get their son out of the country.

VICTOR BLACKWELL, CNN HOST: Kylie Atwood for us at the State Department. Thank you, Kylie.

(MUSIC)

BLACKWELL: It's the top of the hour on CNN NEWSROOM. Good to have you with me. I'm Victor Blackwell.

Well, get ready to pay more if you or your business needs to borrow money. Last hour, the Federal Reserve made a historic announcement, they will hike interest rates by a half percent, that's the highest rate in 22 years. The goal here is to reduce inflation.

Fed Chairman Jerome Powell spoke directly to the American people.

(BEGIN VIDEO CLIP)

JEROME POWELL, FEDERAL RESERVE CHAIRMAN: Details of today's meeting, I'd like to take this opportunity to speak directly to the American people. Inflation is much too high, and we understand the hardship it is causing, and we're moving expeditiously to bring it back down. We have both the tools we need and the resolve that it will take to restore price stability on behalf of American families and businesses.

(END VIDEO CLIP)

BLACKWELL: Also today, President Biden is touting a record reduction in the federal budget deficit. He also promised to keep paying down long-term government debt.

CNN chief White House correspondent Kaitlan Collins join us.

So, inflation is a concern for this administration. Why the focus on the deficit today? KAITLAN COLLINS, CNN CHIEF WHITE HOUSE CORRESPONDENT: Because really

the president wants to push back on the criticism of his handling of the economy, and so he believes that today he can showcase his plan to address these concerns about inflation by talking about paying down the national debt, something the president says is happening for the first time in six years. He knows that inflation is the number one concern for so many Americans, and so the president was saying today that basically they can make this argument. They can try to reduce the national deficit, and he believes that is going to help address those inflationary pressures, which of course, Victor, we know have been building for months but the president today largely a attributing to the war in Ukraine, talking about how driving up gas prices, as well as grocery prices.

The president said this is going to be a way, as he was talking about what his plan going forward is going to look like, and how that's going to affect Americans, and pushing back on criticism that he's getting from Republicans.

(BEGIN VIDEO CLIP)

JOE BIDEN, PRESIDENT OF THE UNITED STATES: All the talk about the deficit from my Republican friends, I love it. I reduced it $350 billion in my first year in office. And we're on track to reduce it by the end of September by another $1,500,000,000,000, the largest drop ever.

I don't want to hear Republicans talk about deficits and their ultra MAGA agenda. I want to hear about fairness. I want to hear about decency. I want to hear about helping ordinary people.

The bottom line is that for decades, the trickle down economics has failed.

(END VIDEO CLIP)

COLLINS: And, of course, Victor, as you know, we have seen such an emphasis on the leaked opinion from the Supreme Court talking about what this is going to do to animate voters, Democratic voters ahead of the midterms. You did hear from Democratic Senator Joe Manchin today saying he believes inflation is going to be the number one thing driving people to the polls and helping them make their decisions, which party they're going to be voting for this fall. So, there's still a major concern obviously at the White House with President Biden addressing that today.

Of course, this comes, the president was speaking just hours before the Federal Reserve announced that they were going to be raising these interest rates half a point, half a percentage point. Of course the biggest raise they have seen since the year 2000 in 22 years, Victor.

BLACKWELL: Yeah. Senator Manchin says follow the money. Kaitlan Collins for us there at the White House, thank you.

Let's turn to the war in Ukraine. Ukrainian forces seem to have retaken another village in the northern Kharkiv region. Troops there to be seen plant a flag on a building in the village of Molodova, just 13 miles from the Russian border.

CNN's Sam Kiley is nearby in eastern Ukraine.

So, some Ukrainian counteroffensive appears to be getting closer to the Russian border.

SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Victor, I think that a counter offensive in one area is matched by an offensive by the Russians in another. Where I am in Kramatorsk, relatively close to here, about 20 kilometers, 25 kilometers north of here, there's a ferocious fight going on for the town of Lyman.

This is a back and forward fight in the east, and mostly involving the use of long range and relatively long range artillery. It's a very vicious and bloody fight, one that rarely sees the infantry engagement in and around Kharkiv.

There have been Ukrainian successes there, possibly because the Russians are focusing their attention on trying to push to this city where I am in Kramatorsk and also, of course, they're also concentrating their efforts more to the east, today suffering some catastrophic levels of civilian casualties.

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We're not exactly sure of the numbers but across the region, local authorities say 21 civilians have been killed, Victor. So it's a very complex and daily ebb and flow of this fight continues, Victor.

BLACKWELL: There's a new convoy of buses of civilians from Mariupol, on its way to Zaporizhzhia, what do you know about the evacuations specifically at that Azovstal steel plant?

KILEY: Well, still to understand, that Azovstal, not least because the Russians have been accused of a very intensive campaign to try to dislodge the remaining Azov Battalion and other marines, alongside what the Ukrainians are saying is several hundred, they says civilians trapped among them, 30 children according to the Ukrainian authorities. They have been heavily bombarded from the air, from the sea, and, of course, from land. And there have been attempts to assault it.

Now, the Ukrainians are saying that after a sustained period in which they were unable to communicate with the forces in that steel plant, they have now renewed communications but the commander there desperately calling for more civilian evacuations, which as we all know have been extremely fraught and slow, and difficult to pull off from Mariupol city, let alone from the steel plant.

Of course, the Ukrainians accusing the Russians of forcibly moving civilians into their own territory, subjecting them to filtration, the removal of the men folk, and moving them deep inside Russian territory. That's something that's very difficult to verify because it's almost impossible to do independent journalism now in Russia -- Victor. BLACKWELL: Yeah. But that's an important update that the Ukrainians

have been able to reestablish communications with that steel plant. Also getting reports of Russians targeting the infrastructure there in Ukraine, specifically railways, just talk about the effectiveness of that strategy as they try to keep these NATO weapons from reaching Ukrainian fighters.

KILEY: Well, that's absolutely key to the Russian campaign. And if you look at it, really, the Ukrainians have held the Russians at bay. Yes, they've enjoyed some incremental successes here and there and the massacre effectively and destruction of cities like Mariupol, and large areas of Kharkiv.

But the Russians have been held up, as far as the Ukrainians are concerned, they are desperate for these long range artillery pieces in particular, coming from the United States, from Germany, and from the United Kingdom, and elsewhere because they believe particularly with the radar that they come with, that can intercept incoming artillery, they can turn the battle against the Russians.

How are they going to get all of this equipment here? That is principally by train and road, and that is why the Russians have been hitting these targets in particular, the train lines but also the electrical supplies to those lines, Victor.

BLACKWELL: Sam Kiley, with the latest reporting from Kramatorsk, thanks so much.

Meanwhile, the European Union is proposing a sixth round of sanctions against the Kremlin, including a ban on all Russian oil imports by the end of the year.

Let's discuss now with the president of the Council on Foreign Relations, Richard Haass.

Thanks so much for being back with me. The significance first of that proposal from the EU commission president, and can they get there? Because we have discussed how heavily Europe relies on Russian energy imports. That may even be as Nic Robertson tells us a cut out, a get out for Slovakia and Hungary.

RICHARD HAASS, PRESIDENT, COUNCIL ON FOREIGN RELATIONS: The question of whether they can do it, some will find it more difficult than others. They'll have to find alternative sources that can sometimes be expensive on the so-called spot market. The real question is what significance it will have not necessarily vis-a-vis Europe but vis-a- vis Russia. Will this inflict real pain? And the short answer is probably not.

The Russians can and will find other places to sell their oil to. India has been buying a lot of Russian oil, potentially China, lots of the rest of the world needs it. Oil and coal can easily be substituted. The wonky word is fungible.

The real significant energy source is gas, and that's much more limited in your ability to substitute. And Europe is not willing to do anything meaningful there. That means hundreds of millions of dollars go to Russia every day.

BLACKWELL: The proposal extends beyond just the ban on oil. The EU Commission president, she also suggests removing Russia's largest bank, Sberbank, from the SWIFT system, this international payment system we have discussed. Is this a bigger deal than the oil ban?

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HAASS: Again, this is -- this is incrementalism. It all is going in the right direction. But we shouldn't kid yourselves. None of these sanctions is going to make a fundamental difference in Russian behavior, in Russian capacity.

It's not a criticism. It's simply an observation. But it's not going to in any way determine the trajectory of this conflict.

BLACKWELL: Yeah. So when the president said today that he is open to more sanctions, and you talk about incrementalism, I'm sure there's people that wonder why are there sanctions available if we've watched for the last several months the atrocities in Bucha, in Mariupol, across the country, why hasn't the whole kitchen sink been thrown in?

HAASS: Well, the biggest thing left in the kitchen sink to strain the metaphor, Victor, is gas. And again, if Russia can't sell gas to Europe, it would lose hundreds and hundreds of millions a day, and that gas can't go anywhere else because the pipelines don't exist to anywhere else. So that's the area that would really make an appreciable measurable difference, but Europe is not willing to do it for the simple reason they don't have substitutes.

And if they were to shut off Russian gas, European economies, in particular, Germany's economy, the largest in Europe, would contract significantly, maybe between 5 and 10 percent. That is the one big remaining sanction that would make a difference. It's not yet on the table.

BLACKWELL: Let's talk about May 9th, coming up on Monday, Victory Day, important day certainly on the Russian calendar, the day they celebrate defeating the Nazis in 1945, U.S., Western analysts have said there's an expectation on that day that Russia could declare war on Ukraine. The Kremlin now says that is not going to happen on Victory Day, on May 9th.

Are you expecting any moment, any punctuation on that day from Russia related to Ukraine?

HAASS: It's a bit of a dilemma for the Russians, if they highlight things, you know, you have to highlight the reality that the situation on the ground is not going terribly well from Russia's point of view, but I think your word punctuation is about right. I would be surprised if we didn't see certain kinds of rhetoric wrapping this more in a kind of package that Russia is being threatened here. It's Russia against NATO, against the United States, against the West, what Mr. Putin wants to do is have the average Russian essentially get on board, and see this as a necessary war rather than a war of choice. So I expect at a minimum, the rhetoric will go in that direction, and

once again, try to paint Russia as the victim rather than the aggressor.

BLACKWELL: Speaking of rhetoric, there's something you tweeted out that I have been waiting to ask you about. You say that it's time for the administration -- calm down, I'm not coming for you, it's something that the administration needs to walk back, that the defense secretary said that the goal is to see Russia weakened military. You think -- militarily. You think it's time for the administration to walk that back, why?

HAASS: Look, Russia is being weakened as a result of the war. So, don't get me wrong. To set that up as a goal, that's not the goal that NATO signed up for. Certainly not Germany, not a lot of other countries. They signed up to defend Ukraine, to basically deal with this as a limited problem.

To say your goal is to weaken Russia, that expands your war range significantly, and that's also the kind of war aims that potentially puts Mr. Putin in a corner where he could lash out against NATO or conceivably escalate the chemical and nuclear weapons.

That's a unilateral statement by the secretary of defense. I'm not even sure, Victor, represents the administration. This was not a carefully orchestrated change in U.S. strategy, but it's part and parcel a more aggressive use of rhetoric by this administration, at times by the president, here by the secretary of defense, and I don't think it's been carefully calibrated, let me put it that way.

BLACKWELL: Yeah, we have seen some inconsistency in the administration. The use of war crimes, genocide, whether it's personal or official, this may be one of them.

Richard Haass, always good to have you, sir. Thank you.

HAASS: Thank you.

BLACKWELL: All right. It's not just abortion, President Biden is warning other rights will be at risk if this leaked Supreme Court opinion holds up.

And Vice President Harris has a message for Republican leaders, how dare you? What do Democrats plan to do?

That's next.

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BLACKWELL: Today, President Biden questioned which other social liberties may be at stake if the Supreme Court overturns Roe v. Wade.

(BEGIN VIDEO CLIP) JOE BIDEN, PRESIDENT OF THE UNITED STATES: What happens if you have a state that changes the law saying that children who are LGBTQ can't be in classrooms with other children? Is that -- is that legit under the way that the decision is written? What are the next things that are going to be attacked? Because this MAGA crowd is really the most extreme political organization that's existed in American history, in recent American history.

(END VIDEO CLIP)

BLACKWELL: Joining me now, CNN Supreme Court reporter Ariane de Vogue.

So, Ariane, the issue now is abortion because of this leaked draft but you've spoken with advocates for other rights who are concerned similar to what we heard from the president.

ARIANE DE VOGUE, CNN SUPREME COURT REPORTER: Right, that's right, because Alito in this draft opinion, he tries to wall off overruling Roe from other decisions that may share some of the same legal reasonings, may be based in privacy, based in liberty.

As Alito says Roe is different because abortion has to do with taking potential life, but the experts that I've talked to, they say that you can't wall it off reading this draft opinion, and they think that other opinions are in jeopardy. Opinions, for instance, having to do with the right to contraception, the right to marry somebody of a different race, the right to marry a same-sex couple -- same-sex partner. They think that those decisions would be in jeopardy with this draft opinion, and they point to what Alito says because at one point he says, look, abortion isn't in the Constitution, Roe v. Wade, that's one reason it has to be overturned.

And at another point, he puts through this kind of test to suggest that for a right to be sustained, it has to be rooted in text or history. Well, if you look at some of these cases I mentioned, there would be an argument that maybe they weren't. And so, lower court judges are going to look at whatever the final opinion is and it might be this draft opinion, and they will be able to pull out words that are written in it that could go toward bringing down these decisions.

And you know that these challenges are coming because even in this particular case, there's a friend of the court brief written by a lawyer. He urged the Supreme Court to overturn roe and, he said, once you do that, you should over turn Obergefell, which is the decision that legalized same sex marriage, and he called that as lawless as Roe. So, that's the direction things could head, and that's why this leaked draft opinion has really shown so many powerful implications.

BLACKWELL: Ariane de Vogue with the latest reporting.

Let's take some of that to Democratic Senator Tina Smith of Minnesota who once worked at Planned Parenthood.

Senator, thanks for being back with me. I want to pick up where Ariane just left off. Do you believe genuinely

that this court will overturn, let's say, Loving v. Virginia, and outlaw interracial marriage? Do you believe that's possible in this court?

SEN. TINA SMITH (D-MN): Well, thank you, Victor. It's great to be with you again.

And I think the question that everyone is asking themselves and the reason why people are so angry right now is that the fundamentals of how we thought about the Supreme Court seem to be a bit thrown out by the window by the draft opinion that Justice Alito has written.

You know, as we just heard, he said, well, if abortion isn't mentioned in the Constitution, then it isn't a fundamental right. It isn't guaranteed by the Constitution, but you could say that about a lot of what we deal with and live with in modern life right now. There's certainly nothing in the Constitution that says, you know, has anything to say about whether people of different races can marry one another.

The thing about it is that this is a story that we have heard before in our country's history where you say, no, we're not going to protect these rights at the federal level. We're going to send it back for states to figure out. It's the old states rights argument which meant that here at the federal level, we were ignoring -- abrogating our responsibility to protect fundamental civil rights. And I think that's why it's so concerning and why people are so angry right now.

BLACKWELL: OK. So, the question is, what do you do next? You tweeted: The Supreme Court is going to overturn Roe, it's time to organize. Obviously the goal for pro-choice Democrats and some Republicans is to protect a woman's right to choose. But organized to do what, to do get there? What's this middle act, middle change, that you are organizing or want to organize, to protect those rights?

SMITH: Well, there's two things. I mean, I'm a progressive, but I'm also a realist, and I can count. And I understand that we do not have the votes in the United States Senate right now, particularly with the 60 vote super majority to pass a law making Roe versus Wade the law of the land, if the Supreme Court is going to refuse to uphold the constitutional protection.

So, what do we do? We do what we always do in this country. We go back out. We organize voters. We turn people out to vote.

We know that a majority of Americans agree. A majority of Americans do not want to see Roe v. Wade overturned and it becomes a galvanizing issue, I believe, and the midterm elections just coming up.

And that's the work that we have to do. That's how a democracy is supposed to work.

BLACKWELL: You said it would be galvanizing. The head of the House Democratic Campaign Committee says that it will be the central choice of the 2022 elections. We heard from the majority leader there in the Senate, Chuck Schumer who says Republicans will pay consequences. I want you to listen to your colleague, Joe Manchin on what he thinks will be the top issue in 2022 in November.

(BEGIN VIDEO CLIP)

SEN. JOE MANCHIN (D-WV): Inflation is the number one driving factor, I believe, in my state. Right now, it's hurting everybody.

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Do you think this Roe versus Wade issue is going to be a driver?

MANCHIN: No, sure, all those very issues.

RAJU: Will that be the main issue in the election do you think?

MANCHIN: It's always been, follow the money.

(END VIDEO CLIP)

BLACKWELL: Joe Manchin says follow the money.

[15:25:02]

So, where do you think? Do you think inflation will lead as the driving issue or a woman's right to choose?

SMITH: Well, what I think is that voters are not -- you know, you have to look at the whole person. You have to talk to all of the issues people have in their minds, and the issues that they're concerned with, if you want to communicate with them effectively, not only during an election but during all of the time that you're in elected office.

So, of course, inflation is a really important issue. Of course, the cost of precipitation drugs is a big issue. Of course, access to health care is a big issue, and I believe also that choice is a very important issue. And it comes down to the most American of ideas, freedom and autonomy over our own bodies.

So I think that people risk making a mistake if they only think about voters as being a single issue. They've got a lot of things on their plate, and I think this is going to be a very big one as we approach these elections, and an issue that is going to really have a galvanizing turnout, impact.

And that's what we need, right, we need as many people as possible to turn out and vote.

BLACKWELL: Senator, let me ask you about the corporate response. We saw Disney, the CEO there spoke out against the "don't say gay" bill in Florida. Coke and Delta opposed the voting rights, or the voting restrictions law in Georgia. You supported the Milwaukee Bucks in 2020 when they demanded a special session in Minnesota for policing reform, supported their boycott.

Do you want to see corporate -- corporations step out, speak out on this issue?

SMITH: Well, this is an interesting and complicated question, right, because corporations are acting in their enlightened self-interest if they know what they're customers and what their employees, and even when their shareholders want, then they're going to be speaking out in that -- you know, speaking out in favor of those issues. I think the actions of these big corporations speaking out in favor of guy rights, for example, shows that they are in touch with what matters to Americans, and what people have on their minds.

But I have to also say let's understand that the path that we have been on with overturning Roe versus Wade is the result of a decade's long strategy, fueled by big dark money organizations, some of them corporations. I'm not laying this all on corporate America, fueled by dark money, in order to overturn Roe, in order to pack the court with extreme right wing justices.

And so, you have to look at what people say, what big corporations say, important, but you also have to look at where they put their money, and what impact that has on the policies that we -- that we see coming out of the Congress and what we see coming out of the Supreme Court.

BLACKWELL: Senator Tina Smith, always good to have you on. Thank you for your time.

SMITH: Thank you. Thanks, Victor.

BLACKWELL: All right. Right in the middle of his last or his set last night, Dave Chappelle was rushed on stage by a man armed with a knife and a fake gun. CNN's Rachel Crane was near the front row when it happened, and she's going to tell us all about it.

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