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January 6 Committee Hearing Fallout; Uvalde Video Leaks; Inflation Surging. Aired 1-1:30p ET

Aired July 13, 2022 - 13:00   ET

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

[13:00:56]

ANA CABRERA, CNN HOST: Hello, and thank you so much for joining us. I'm Ana Cabrera in New York.

Surging inflation, a major investigation, and a surveillance video that is shaking the nation. We are following a lot of headlines today.

First, after meticulously outlining evidence, sharing new testimony, the January 6 Committee says it has started producing information for the Justice Department, and the panel wrapping up its latest hearing with a fresh bombshell. Former President Trump tried to contact a witness. We dig in.

Plus, a fierce reaction to police inaction. Video from inside Robb Elementary leaked. And we can now see exactly what police were doing as they waited for more than an hour to confront the shooter.

And inflation hits a new 40-year high. We're talking gas, food, rent. The costs are surging, but by how much and why isn't it getting better? That's where we start.

CNN business reporters Rahel Solomon and Matt Egan are with us.

Now, Rahel, ladies first, OK, 40-year inflation high, but we're seeing gas prices starting to go down. So what's going on?

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: So gas prices are interesting, because we have seen some demand pull back, likely because gas prices became quite high.

We're seeing a bit more supply. So that's good news. But also we're seeing recession fears hit crude really hard. And so because of all of those factors, we have seen some relief at the pump for consumers. Hard to tell, though, when you look at this report, gas prices up about 60 percent compared to a year ago.

So the declines we have seen as of late not reflected fully in this report. The hope is that we will see some easing in next month's report. But, look, you're seeing some relief at the pump, but you're not seeing it at the grocery store. You're not seeing it practically anywhere else right now.

And so you're getting it a bit at the pump, but not really anywhere else.

CABRERA: So, Matt, what does this mean for what's next? Another Fed rate hike?

MATT EGAN, CNN REPORTER: Yes, absolutely.

I mean, the inflation fire continues to rage. And so the Federal Reserve has to step in and act like the firefighters and try to put this plays out by raising interest rates to cool the economy off.

Last month, the Fed raised rates by three-quarters-of-a-percentage point, the biggest move since 1994. And you got to believe that Fed officials are going to be forced to consider a similar move or maybe even a bigger one, because of this really hot inflation report.

There's no doubt that the Fed was late to this inflation fight. And that means they have got to do more to catch up. I asked White House economist Jared Bernstein today if he wishes the Fed moved a little faster to get out of emergency support mode to inflation fighting mode. And he stressed that the White House continues to have great faith in the Federal Reserve, and he's not going to meddle in Fed affairs.

He said -- quote -- "History is littered with presidents interfering with Fed rate hike cycles. This president has committed to staying out of that knitting."

So the White House has given the Fed breathing room to step up its fight against inflation. But that means, for families, higher borrowing costs, right?

CABRERA: Yes.

EGAN: Mortgages, credit cards, car loans, student debt. The risk, of course, is that the Fed overdoes it and ends up slowing the economy right into a recession.

CABRERA: Right. Right.

What about house -- home prices, home sales? I mean, there's some potential good news here, right, for homebuyers?

EGAN: Yes, I think it cuts both ways.

I mean, the fingerprints of the Fed are all over the housing market, right? Home prices skyrocketed, in part because borrowing costs were so low, but now the Fed is raising rates. And so we have seen mortgage rates go up sharply; 5.3 percent is the average 30-year fixed-rate mortgage. That is nearly double a year ago. It has come down just a bit in the last week, but still remains way higher than a year ago.

And I think, for homebuyers, the bad news is that means some people just not going to be able to afford to get a mortgage. They're just not going to be able to pay those rates.

CABRERA: But home prices are kind of coming down, right? EGAN: Yes.

(CROSSTALK)

CABRERA: The market is changing in that way.

EGAN: I think the good news is that this shifts the balance of power, right?

We had months of these all-cash offers and bidding wars on homes. And this is going to slow things down and give some more bargaining power to buyers and maybe cool prices off somewhat.

CABRERA: When we talk broader economy and other headlines this week, Rahel, there was also this.

[13:05:00]

For the first time in 20 years, the dollar and the euro are equal in value. What does that tell us?

SOLOMON: Yes, investors have really flocked into the U.S. dollar as a safe haven amidst these turbulent times globally.

So, if we're -- if you're an American and you're traveling to Europe this summer, you're likely going to see one to one, which is really great. We haven't seen that in about 20 years. And so $1 here is a euro there.

Not great, however, for American companies that have a multinational presence, right, because now all of a sudden, your products have gotten a lot more expensive for our friends in Europe. And so that's going to be a drag on corporate earnings. So for us consumers, great news. If you're traveling to Europe, that will be great news.

But for American companies, it creates a bit of a complication, a challenge there,

CABRERA: OK, Rahel Solomon and Matt Egan, thank you both.

Now to the January 6 investigation. While the Select Committee is preparing for an eighth public hearing, we have got a lot to break down about what we have heard so far.

And with us now to discuss is former Watergate prosecutor Nick Akerman, former Trump White house lawyer Jim Schultz, and authoritarian expert Ruth Ben-Ghiat, author of "Strongmen: Mussolini to the Present."

Thank you all for joining me.

Nick, the committee has promised that they would directly connect the extremist groups that stormed the Capitol to the Trump administration. Did they deliver in this hearing?

NICK AKERMAN, FORMER ASSISTANT SPECIAL WATERGATE PROSECUTOR: Well, they did it to an extent.

They certainly showed that Donald Trump put out that tweet on the night or The early morning of December 9 that basically resulted in all of these extremist groups showing up on January 6. They showed that he was totally aware of the rally that was going on, ON January 5 that was involving the extremist groups at another location close to the White house.

There are hints about calls from people to Roger Stone to Steve Bannon, Steve Bannon speaking to Donald Trump the night of January 5, and then basically saying on his podcast that things are really going to be wild the next day.

You have got Meadows making a call to Roger Stone. I don't think they have really tied it together. There's lots of circumstantial proof here that Donald Trump knew something was going to happen. But I think it's going to be that last hearing that we're going to get it tied together.

CABRERA: The other piece of evidence revealed in this hearing, Jim, was in the wake of the attack, so right after it happened.

Trump's former campaign manager Brad Parscale sent a text saying -- quote -- "Trump's rhetoric killed someone."

Another campaign official, Katrina Pierson, responds: "It wasn't the rhetoric."

Parscale writes back: "Katrina, yes, it was."

Jim, your take? Do you feel like the connection is clear?

JIM SCHULTZ, FORMER TRUMP WHITE HOUSE LAWYER: So, look, I think the last comments were exactly spot on.

But what I think -- I don't think you're going to get that clear nexus out of this committee. I think the only way to get that clear nexus is to do that by way of a grand jury.

And we will see whether the Justice Department takes that up. And I do believe that Congress will likely make a referral over to DOJ, given some of the signals that we have seen today from the chairwoman.

CABRERA: And, Ruth, we heard yesterday from one witness who pleaded guilty already in the DOJ investigation to disorderly conduct for illegally entering the Capitol that day. Listen to this.

(BEGIN VIDEO CLIP)

STEPHEN AYRES, PLEADED GUILTY TO DISORDERLY CONDUCT: We then actually plan to go down there. We went basically to see the Stop the Steal rally, and that was it.

REP. STEPHANIE MURPHY (D-FL): So, why did you decide to march to the Capitol? AYRES: Well, basically, the president got everybody riled up, told

everybody to head on down. So we basically were just following what he said.

(END VIDEO CLIP)

CABRERA: How significant was this testimony?

RUTH BEN-GHIAT, NYU HISTORY PROFESSIONAL: Oh, very, because the core -- we really can't understand January 6 without understanding the strength of Trump's leader cult and the hold he had on people.

And this was a save the leader event. They were summoned by this leader in distress who had had the election. He had been wronged and they were going to right the wrong, but he'd also been using rallies since 2015 to systematically cultivate not only extremists, and as the Oath Keepers said yesterday, giving them a path forward, making them feel legitimate.

Remember, he also-called neo-Nazis very fine people. I bet they didn't expect that from a president of the United States. So all these different extremists were given a kind of a big tent to feel like they had a path forward to and were encouraged in violence.

But the rallies in particular were cultivating this kind of emotional training to be violent and consider violence as patriotic. And I think that's why Brad Parscale, who was not only his campaign manager, but oversaw the digital part, and that testimony that -- the first one you mentioned, he talked about how he was radicalized on social media.

[13:10:11]

That's why Brad Parscale said that the rhetoric kills coming from Trump.

CABRERA: And, Nick, you mentioned this off the top. A lot of these people went to D.C. because of that initial tweet from Trump encouraging people to go there. Be there, be wild, he wrote.

Nowhere did Trump, though, explicitly say, storm the Capitol. But it seems so many of these people took all this as Trump giving them directives. It was just hours later after that tweet members of the Oath Keepers and Proud Boys, we learned that they reportedly decided to form an alliance.

As a prosecutor, though, is that enough?

AKERMAN: Well, you need more evidence here.

But you have got to keep in mind there were really two groups of people there. There was the group of people like Stephen Ayres who basically followed what President Trump said. They went there because they thought there had been a wrong.

But there was also this other group that was the Oath Keepers and the Proud Boys that were there very purposely. It was premeditated. It was set up for them to actually go into the Capitol at different spots to break in there, to cause the mayhem and the violence, the goal of which was to stop the vote count on the Electoral College.

That was the whole point of what they were doing. All the people that were there like Stephen Ayres were simply a foil to them to create more mayhem on the spot to give the Proud Boys and the Oath Keepers the room to get in.

CABRERA: Jim, for the first time we finally heard from former White House counsel Pat Cipollone. You and I spoke about the anticipated testimony. What did you think? How key was his testimony?

SCHULTZ: I think it was key, in that he confirmed a lot of things that Cassidy Hutchinson and others had testified to in the past.

There was no real bombshell there, but certainly value, because he was able to confirm and corroborate some of the testimony of other witnesses, which was the key for this committee. And, also, I do think, going back to what we talked about earlier, the court of public opinion -- certainly, the foreign president is taking huge hits in the court of public opinion right. now on this thing.

Remains to be seen whether he takes the hit in a court of law. I think Larry is right. We need to have -- we need to have more evidence in order to move forward.

CABRERA: Nick, Steve Bannon was also part of this hearing. You brought up his podcasts that was on January 5, when he said this.

(BEGIN VIDEO CLIP)

STEVE BANNON, FORMER WHITE HOUSE CHIEF STRATEGIST: All hell is going to break loose tomorrow. Just understand this. All hell is going to break loose tomorrow. It's not going to happen like you think it's going to happen, OK? It's going to be quite extraordinarily different.

And all I can say is, strap in.

(END VIDEO CLIP)

CABRERA: Yes, we have played that before. Yes, we have talked about it before.

But now we know so much more. Minutes before he said that on air, he spoke to then-President Trump. They spoke for 11 minutes, according to White House phone logs. And this week, we know Bannon has said he's willing to publicly testify

Nick, if you're on the committee, what do you do?

AKERMAN: Well, I think they should take his testimony. They should take it behind closed doors. They don't want to put him out on public testimony right away, because he's just going to try and play the committee. He's going to use it as a P.R. stunt.

And he's going to use it to try and raise a defense in his criminal prosecution. So the committee has to be very careful how they take that testimony, but they should take it. I mean, at a minimum, the worst that happens is the guy's going to perjure himself and he will wind up in another criminal prosecution.

CABRERA: Jim, the panel's vice chair, Liz Cheney, ended yesterday's hearing saying Trump tried to contact a witness who has not yet appeared before the committee in these hearings. She says the committee referred that to the Justice Department.

This was the first time the committee mentioned DOJ involvement during a hearing. So what do you see as the significance? Do you think this was about the committee sending a broader message?

SCHULTZ: I think it's about the committee.

Look, there have been a number of threats that have come to witnesses from unknown folks. We don't know who they are. We don't use if there was anyone directing them. But contact with a witness is certainly something that they have been taking seriously

No surprise that any contact with a witness that they're going to send over to DOJ to look into. No surprise there at all. And as far as Bannon's testimony goes, I think we have to be mindful there, if they do that behind closed doors, there is some political risk there, because they have been pushing everyone out in front of the cameras time and time again.

I think -- and they tried to get Pat Cipollone to do it in front of the cameras live. Now, all of a sudden, you're going to draw back because you don't like what Steve Bannon is going to say. You're afraid that he's going to make a mockery of the process.

[13:15:01]

I think you just need to be prepared for it, be aggressive, and take his testimony on air, so that you can maintain that credibility of this committee.

CABRERA: Ruth, the other live witness, a former Oath Keepers spokesperson, said he fears what will happen next if people aren't held accountable.

How concerned are you about the current threat?

BEN-GHIAT: I'm very concerned, because the GOP, which really is becoming an extremist entity, is unrepentant.

On January 7, when they did not denounce -- they could have thrown Trump to the wolves, he was so toxic. And, instead, they doubled down and they have -- it's been a very radicalizing event for the whole party.

And what's coming out is how this cultivation of extremists that the Oath Keepers and all these other kinds of extremists, you could think of them as an emerging paramilitary wing or militia wing of the party. And they would do it again tomorrow, many of these people. And that's why I want to say, having studied unfortunate destructions of democracy all over the world, that the fact we're having these hearings at all, it makes me so proud to live in a democracy. We wouldn't be able to have those hearings in many other countries. And the investigators and the witnesses would -- not good things would happen to them.

So let's remember the extraordinary work this committee is doing on behalf of accountability and democracy.

CABRERA: Ruth Ben-Ghiat, Jim Schultz, Nick Akerman, thank you both -- all of you, I should say. Thank you. I really appreciate you being here.

AKERMAN: Thank you.

CABRERA: They were heavily armed, wearing body armor, and on the scene, but they didn't act. Outrage in Uvalde and across the country, as surveillance video from inside the school shows exactly how police responded, or didn't, as innocent children and teachers were attacked.

Plus, President Biden facing a major foreign policy test in the Middle East right now. It's a heavy lift, as issues mount back at home. We're going to go live to Jerusalem.

And we get it. We're all tired of this pandemic, but the White House COVID coordinator says, not only is it not over. We are facing the most immune-evasive variant yet.

(COMMERCIAL BREAK)

[13:21:38]

CABRERA: No urgency, no action.

Heartbreaking new surveillance video shows officers waiting and waiting and waiting inside the Uvalde school hallway outside classrooms as innocent children and teachers were gunned down.

You see right here, nearly an hour after the shooter enters the school, officers just standing there. One even fist-bumps another officer. And while all this was happening, one teacher, the lone survivor of his classroom, describes this haunting encounter with the shooter.

(BEGIN VIDEO CLIP)

ARNULFO REYES, ROBB ELEMENTARY SCHOOL TEACHER: He tried to make me flinch, spilled water on my back, cold water. And I had a cup on a table, and he spilled it on me. And I didn't move.

He did the cell phone thing also, where he dropped it on my back, because I was getting calls and texts. The last thing he did to me was, he splashed blood on my face. My blood that was coming out of my arm.

(END VIDEO CLIP)

CABRERA: CNN's Rosa Flores has more.

(BEGIN VIDEOTAPE)

ROSA FLORES, CNN CORRESPONDENT (voice-over): An edited version of surveillance video, one of two videos released Tuesday by "The Austin- American Statesman," shows that, at 11:32 on May 24, the first shots were fired outside Robb Elementary School, and audio of a teacher calling 911.

UNIDENTIFIED FEMALE: The kids are running! Oh, my God. Get down! Get in your rooms! Get in your rooms!

FLORES: Then, at 11:33, school surveillance video shows the gunman entering an empty hallway, unhindered, walking casually with his gun hanging down.

He slows down, peaks around a corner. A boy sees him as he starts shooting, and the boy runs. According to "The Statesman," the gunman fired his weapon, an AR-15, inside two classrooms for 2.5 minutes, stopping and starting multiple times.

"The Statesman" saying they edited out the most disturbing sounds, including screams. This surveillance video shows seven police officers arriving armed, some with rifles. They enter the hallway weapons drawn at 11:36, just three minutes after the gunman arrived, while shots are being fired.

In total, the material revealing just over two of the more than 70 minutes police were in the hallway before killing the gunman, some rushing towards the classrooms, other officers hanging back. Within one minute, shots are heard, 16 rounds in total, and police can be seen retreating, running back down the hallway to take cover.

Then, at 11:52, 19 minutes after the gunman enters the school, the time stamp on the video shows more officers arriving heavily armed, some with ballistic shields. Still, they wait. At 12:04, the video jumps 31 minutes after the gunman enters the school, and law enforcement is still waiting. At least 19 officers are now in the hallway, according to the official timeline.

At 12:21, 45 minutes after police arrived, the gunman fires another four shots. And police start to move down the hallway again, remaining out side the classrooms.

[13:25:02]

At, 12:30, one officer uses the hand sanitizer dispenser in the school. At 12:43 and 12:47, more 911 calls to send police, and the caller says children are aware the police are outside the door.

(GUNSHOTS)

FLORES: Then, at 12:50, 74 minutes after police first arrived, officers breach the classroom door and kill the gunman. At this point, the video shows officers in the hallway pushing to go in.

The Texas DPS director expressed his disappointment the video was released before the victims' families were given access to it, releasing a statement saying: "Those most affected should have been among the first to see it."

(END VIDEOTAPE)

CABRERA: This video is just so infuriating to everybody who's watching it, Rosa, but to the family members of the victims, the world can now see the moment their baby, their wife, their mother was murdered.

What's the reaction there in Uvalde?

FLORES: You know, the families are outraged. The officials here who were advocating for the release of the video are outraged, because the families were not given a heads-up.

Those families were expecting to view all of this on Sunday, but they were preparing themselves emotionally to do this. The mayor of Uvalde telling CNN that he's calling for a criminal investigation into this leak.

Take a listen.

(BEGIN VIDEO CLIP)

DON MCLAUGHLIN, MAYOR OF UVALDE, TEXAS: The way that video was released today is one of the most chicken things I have ever seen.

There's no reason for the families to have to see that. I mean, they were going to see the video. But they didn't need to see the gunman coming in and hear the gunshots.

(END VIDEO CLIP)

FLORES: Now, all this as we're learning more about the Texas House investigative report that's expected to be released on Sunday to the families.

According to a source close to this committee, the Texas DPS director, Steven McCraw, was asked to testify a second time before the committee, because the committee was looking for clarification in his prior statements.

Now, according to a source within Texas DPS, they were told that McCraw -- that -- excuse me -- the Texas House committee had more questions for McCraw related to other testimony, other people who had been interviewed.

Ana, it's important to note that, according to the source close to the committee, this investigative report that will be released on Sunday will show that the failure, that the magnitude of the failure here in Uvalde does not boil down to one person, like we have heard so far to the school police chief, that it is of much bigger magnitude -- Ana. CABRERA: Rosa Flores, thank you for your continued reporting on this

important story.

And joining us now is Bill Stanton. He's a former New York City police officer.

Bill, when you watch this video, and you see what officers were doing, and you think about the children and the teachers that were killed in that time, I know I want to jump out of my seat. I'm yelling at the TV, trying to urge these officers into action.

You have been in their shoes as an officer. What's your reaction? And what do you see?

BILL STANTON, FORMER NYPD POLICE OFFICER: Well, I'm going to give the benefit of the doubt to the officers and say, this isn't so much a courage issue, because one would think that it's a lack of courage that they're not going in.

I'm going to go more to a lack of training and leadership. That's what I saw, because while I'm all for getting tactical intelligence and making a plan, once you go from a barricade issue to a tactical shooting issue, you go in. When you hear those shots, you know, especially when they're being directed towards schoolchildren, you go in, and you do what you need to do, and that wasn't done.

So it was -- there was lack of communication, lack of leadership. And as you saw, the equipment, they have the equipment, but the act -- that equipment is only as good as the training and leadership behind it.

CABRERA: I still think about those officers running away from the gunfire because they were being shot at. They're running away from it. They're backing up. And then they're just waiting.

It's now been 50 days since the school shooting. We still don't have all the answers. But I wonder, how does this video now made public impact the investigation?

STANTON: Well, it opens -- it asks more questions than it answers.

What I'm hoping, police departments around the country take a look at this and now go back to the training and learn from this. Active shooters, you need to go in, when something -- when schoolchildren are the main target, you don't wait. You go right in, you -- especially the leaders on the ground.

Again, it's a training issue and a leadership issue.

CABRERA: Not just the failure that happened in the moment, but now this failure in the investigation and the communication related too.

It's been handled so poorly. Last week, we finally got a look at a preliminary investigative report, where we thought we had more answers. But now we're being told the final report will likely contradict that preliminary report. [13:30:00]