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At Least 25 Dead In Historic Kentucky Floods, Many Still Missing; President Biden Tests Positive Again For COVID; Texts From Top Trump Homeland Security Officials Missing; No Agreement Yet On Griner, Whelan Prisoner Swap; Debris From 23-Ton Chinese Rocket Booster Falls To Earth; Oil Companies See Major Profits As Drivers Feel Pain At The Pump; Biden Downplays Recession Fears After Disappointing Economic News; Democrats' Energy & Health Care Bill Faces GOP Opposition. Aired 3-4p ET

Aired July 30, 2022 - 15:00   ET



JIM ACOSTA, CNN HOST: You're live in the CNN NEWSROOM. I'm Jim Acosta in Washington.

And we begin with new footage out of Kentucky showing some of the damage left behind by historic floods that killed at least 25 people. You can see floodwaters slammed this school bus into a building. Just devastating there. Wrecked cars and downed trees are scattered everywhere. And this is far from over. Tomorrow Eastern Kentucky is expecting several more rounds of rain that could even make this flooding worse.

Electricity is out in many places. Cell phone service is not up in some counties. And state officials say 21 drinking water systems have been damaged by rushing waters. There have been more than 600 water rescues. Among the dead are four young kids from one family, boys and two girls, the youngest just 2 years old. The oldest 8. The governor of that state says that with such a vast area of destruction he's worried they will be finding bodies of the victims for weeks to come.


GOV. ANDY BESHEAR (D), KENTUCKY: This is still an emergency situation. We are in search and rescue mode. Again, that count is going to continue to go up. And we don't lose this many people in flooding. This is a real tough one.


ACOSTA: CNN's Evan McMorris-Santoro joins me now.

Evan, just incredible footage of the devastation in that area where you're at right now. Tell us what it's like on the ground, what you're seeing.

EVAN MCMORRIS-SANTORO, CNN CORRESPONDENT: Well, Jim, where I'm standing here in Jackson is the staging area for some of that search and rescue that you're talking about, crews going out to try and find people who may be trapped still, who are looking for help and unfortunately who may have passed in this flooding. That footage that you showed is new and that's from some of the receding floodwaters.

But I want to show you a bit about what some of this stuff has looked like. As I mentioned where I am, there's been a lot of different state officials, local officials out there, searching, also volunteer. And two volunteers from out of state, Gary Hanner, American Air Boat Rescue out of Tennessee, and Leonard Harrison, everybody calls him Country, out of North Carolina, from the U.S. Veterans Corps, took my producer Chris Good (PH) out on a boat. And you can see just some of the devastation you saw in Jackson. That's what happened when the water rose up.

And what you can't see in this footage is the smell. Chris told me that he could smell diesel fuel all in this water. I mean, it's horrible, horrible, damaging, dangerous water. This is what they're dealing with here in Kentucky. And people who have been through this are worried they may not come back from it.


DANA OUTLAW, FLOODING SURVIVOR: I don't know if anybody can move back into these homes for a long time, if ever.

SARAH BENTLEY, FLOODING SURVIVOR: My in-laws, they've lost everything. Animals are without, people are without. Homes are destroyed. We just need help. We need as much help, please, I'm begging anyone who sees this. Help my town. Help my people.


MCMORRIS-SANTORO: Help is the important word. And that's what we're trying to do here in Jackson and all over the rest of this area that's been devastated by this flooding. It's an active scene. They're trying to help people and find them and do what needs to be done -- Jim.

ACOSTA: All right, Evan McMorris-Santoro, thank you very much. We'll keep an eye on all of that, we know you will as well. We appreciate it.

And for more information about how you can help victims of the Kentucky flooding, please go to

Just in in the last several minutes, President Biden has tested positive for COVID again after last testing negative yesterday. An antigen test came back positive. This morning the president's doctor says Mr. Biden is experiencing a rebound from Paxlovid, the medication he had been taking to recover from COVID the first time around.

The president tweeted today, "Folks, today I tested positive for COVID again. This happens with a small minority of folks. I've got no symptoms but I'm going to isolate for the safety of everyone around me. I'm still at work and will be back on the road soon."

And with me now is Dr. Peter Hotez, dean of the National School of Tropical Medicine at Baylor College of Medicine. [15:05:01]

Doctor Hotez, great to see you again. I haven't seen you in a long time but good to catch up. What do you make of this? Should we be, you know, tremendously concerned about this? The White House says that the president is not experiencing any symptoms. You do hear about these rebounds, these Paxlovid rebounds from time to time. What are your thoughts on this?

DR. PETER HOTEZ, PROFESSOR AND DEAN OF TROPICAL MEDICINE, BAYLOR COLLEGE OF MEDICINE: So, Jim, you know, I think it's probably more common than we currently understand. You know, in the clinical trials for Paxlovid, which were done before the Omicron variants or certainly the later subvariants. It would happened about 1 percent to 2 percent of the time. But anecdotally we're hearing about many more cases.

And quite honestly, a rebound after Paxlovid happened to me, it happened to Tony Fauci, Dr. Fauci. And so it wasn't too surprising that this happened. In fact a couple of days ago I warned don't be too disappointed if it also happens to the president. Exactly the percentage of people who are experiencing post-Paxlovid rebound. I hear the number 23 percent. I don't know how valid that is. But it's certainly I think than the -- that was done in the original clinical trials.

And I think it may be partly due to these new subvariants. There's a lot more virus replication and so there's more virus to conquer by taking the antiviral drug. And there's a new study that the University of California San Diego infectious disease group is looking at. They're showing it's not due to emerging drug resistance, the virus is still sensitive to the Paxlovid when rebound occurs. There are antibodies present.

I think it's a matter of exposure to the medicine that there's not enough medicine getting inside the cells over a five-day course to totally wipe out all of the virus. So the question then becomes, should we extend it to seven to 10 days. Eric Topol of the Scripps Institute is now looking at this. He has NIH funding to look at this. So we'll learn a lot more.


HOTEZ: I think the question right now, I think the president hopefully will continue to do well. There's a question whether he should go back on another course of Paxlovid. And so there'd be a lot of interesting discussions in the ensuing days.

ACOSTA: So, Dr. Hotez, you can test positive for COVID again obviously after you take Paxlovid. Does that mean you're also symptomatic and can spread the virus to other people or are you just experiencing the symptoms yourself if you're in this boat?

HOTEZ: Well, it could be both. In my case, what happened was, I -- after I finished my first course of Paxlovid, I felt fine and then about four or five days later, I woke up with congestion and headache, and rhinorrhea, I said, hey, what is this? And did another antigen that was screaming positive at me. It wasn't even subtle. And as a result I wound up going back on Paxlovid.

Fortunately the president doesn't seem to be having much in the way of symptoms. Looks like they were testing even without symptoms. But the fact that rebound Paxlovid is occurring is not terribly surprising. And then his physicians will have to make a decision about whether to go on a second course of the drug or not.

ACOSTA: All right, Dr. Hotez. We hope you're right. Hope the president feels better. And thanks again for your time. Always good to see you, sir. Thanks, Doctor.

HOTEZ: Of course, Jim. Thank you.

ACOSTA: All right. Thank you.

And now to a CNN exclusive. New questions about those missing Secret Service texts. Multiple sources telling CNN that the Homeland Security inspector general first learned of those missing messages back in May of 2021. That's more than a year before he alerted the January 6th Committee. Those texts could be valuable since according to witnesses then President Donald Trump fought with Secret Service agents when they refused to let him go to the Capitol on January 6th.

But it's not just the Secret Service that has a problem with missing messages. "The Washington Post" also reporting texts from Trump's acting Homeland Security chief Chad Wolf and his top deputy Ken Cuccinelli are also missing. Those messages were also sent in the days leading up to January 6th. Wolf says he complied with all data retention laws, quote, "full stop." But any lost data could be important since the January 6th Committee received testimony that Trump wanted the Department of Homeland Security to seize voting machines in the aftermath of the 2020 Election.

Joining me now to talk about this is the former CIA director of National intelligence and a CNN national security analyst James Clapper.

Director Clapper, good the see you. Thanks as always. The fact that the inspector general, a Trump appointee, we should note, would wait more than a year before notifying the January 6th Committee, does this read as incompetence to you or something more nefarious? You would think an inspector general would be open about all of this, transparent about all of this?

JAMES CLAPPER, CNN NATIONAL SECURITY ANALYST: Well, listen, you know, Jim, that's the very thing that typically departmental inspectors general are most aware of, sensitive to, and responsive to.


So this is -- you know, it's kind of a double whammy here. A, that the texts, these critical texts are missing. And then B, that the inspector general of the department was aware of them and didn't say -- aware of these missing texts and didn't say anything about it, or do anything about it. To me this is incredible. I don't know what to ascribe it to whether this is, as you suggest, either incompetence or something more nefarious, I don't know. But it clearly needs to be looked into by somebody outside the Secret Service and outside the Department of Homeland Security.

ACOSTA: And this comes as we're also learning there are also missing texts from Trump's top Homeland Security officials Chad Wolf and Ken Cuccinelli. I want to play more January 6th testimony from the former acting deputy attorney general, Richard Donoghue, about what Trump was asking of Cuccinelli after the election. Just because a lot of time has passed doesn't mean it's not alarming. Let's listen.


RICHARD DONOGHUE, FORMER ACTING DEPUTY ATTORNEY GENERAL: My cell phone rang, it was the president, and he had information about a truck supposedly full of shredded ballots in Georgia that was in the custody of an ICE agent whose name he had. I told him that ICE was part of Homeland Security. It was really up to DHS to make a call if their agent was involved. And he said fine, I understand, can you just make sure that Ken Cuccinelli knows about this. I said, fine, I would pass that along to him. I actually contacted Ken Cuccinelli later than evening.


ACOSTA: You know, Director Clapper, as someone who has written about the importance of safeguarding elections as a matter of national security and as somebody who was, you know, in the government for many years, I guess one of my questions is, how disturbing is it to you that, you know, these kinds of documents, these kinds of texts and so on would not be retained and not be recoverable.

But I guess more importantly how alarming would it be if we never got to the bottom of this? If, you know, this -- I guess this loss of data ends up just getting in the way of getting to the fact of the matter here?

CLAPPER: Well, Jim, it's -- as somebody who spent a lot of time in the government, this is highly irregular, I'll put it that way. And there are all kinds of laws and rules about retention for archival purposes, you know, of these kind of records, and of course, it's just kind of amazing coincidence that these missing records occurred on the 5th and 6th of January, whether it's the Secret Service and the failure of the Department of Homeland Security inspector general to alert to that.

And now, apparently missing texts between Chad Wolf and Ken Cuccinelli, what an amazing coincidence and again this whole thing needs to be looked into. I do think that -- this is my impression. That the committee has an abundance of information already.

And I think this would be critical corroboration, probably, of other information they already have. But I think it's very disturbing that we've suddenly become aware of these critical exchanges between the two top acting officials in the Department of Homeland Security at the time and missing texts from the Secret Service. It's just -- it's really disturbing. ACOSTA: Yes, as you said, an amazing coincidence if that's the case.

And as you know, I want to turn to another subject that has come up in the past week because as you no know, the families of 9/11 victims are very upset with former President Trump for hosting the Saudi-based or Saudi-backed LIV Golf Tournament and this comment that he made defending it. I don't know if you've heard this but let's play it for you and get your reaction to it on the other side.


DONALD TRUMP, FORMER PRESIDENT OF THE UNITED STATES: Nobody has gotten to the bottom of 9/11, unfortunately, and they should have, as to the maniac that did that horrible thing to our city, to our country, to the world.

TIM FOLEY, 9/11 SURVIVOR: It's simple. The Saudis did it. They plotted it, they funded it and now they're trying to distract every one of those sins with a golf tournament 50 miles away from Ground Zero.


ACOSTA: You know, Director Clapper, I just think it's extraordinary that Trump, you know, who had all the access to all the intelligence when he was in office that he would make a comment like that about September 11th.


How strange is that to you that he would make that sort of remark when we all know there was a 9/11 Commission, we all know what happened on 9/11?

CLAPPER: Well, it's more than strange. In the runup to the 2016 election, candidate Trump, on more than one occasion, inferred, suggested, the complicity of the Saudis in the 9/11 attack. And I guess this is a case of money talks. And then when he said, well, no one's gotten to the bottom of it. Well, he had four years in office to get to the bottom of it. As I understand it, at one point had agreed with the families to release some additional documents.

We had done a release during the Obama administration and there were a few more documents which he had committed to release and then didn't. Now President Biden corrected that, as I understand it, since then for the sake of the -- for peace of mind for the families. But for him to run a golf tournament within 50 miles of the attack and the insensitivity to the families, you know, where this is all sponsored by the Saudis, and then to have this I'll just say inconsistent or duplicitous statements that he's made now sort of rationalizing the Saudi involvement and his representation of the Saudis, which is essentially what he's doing, that's pretty appalling.

ACOSTA: Yes. No question about it. Almost sounds like he's trafficking in 9/11 conspiracy theories the way he made that remark.

All right, James Clapper, the former director of National Intelligence. As always, thank you very much for your time. We appreciate it.

And coming up a CNN exclusive of what Russia wants in a prisoner swap to bring Brittney Griner home. Why the U.S. is calling all of this a bad faith move.

You're live in the CNN NEWSROOM.



ACOSTA: A CNN exclusive now. New details on a proposed prisoner swap between the U.S. and Russia to bring home WNBA star Brittney Griner and Paul Whelan. What Russia is proposing as a good deal, the U.S. says is in bad faith. Russia wants a second prisoner in exchange for releasing Griner, detained since February, and Whelan, the American businessman and former Marine who has been in a Russian cell since 2018.

Sources tell CNN that along with the U.S. releasing infamous arms dealer Viktor Bout, Russia also wants a convicted killer and former colonel in its spy agency released from custody in Germany. And here's what the Biden administration told my colleague, Jim Sciutto about that.


JOHN KIRBY, NATIONAL SECURITY COUNCIL COORDINATOR FOR STRATEGIC COMMUNICATIONS: : Holding two American citizens as hostage in exchange for an assassin in a third party country is not a serious counteroffer, Jim. It's a bad faith attempt to avoid a very serious offer and proposal that the United States has put forward. And we urge Russia to take that offer seriously.


ACOSTA: CNN's Frederik Pleitgen is now with me, coming in live from Moscow.

Fred, tell us more about this second person Russia is seeking and has the U.S. reached out to Germany? I mean, is this being taken seriously at all? What's the latest?

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, the U.S. didn't believe that this counteroffer was necessarily serious. This is about Vadim Krasikov, and he's someone who's actually currently as you noted inside a German jail for a murder that took place in Berlin in 2019 for which he was convicted in 2021. And the Germans say that this murder was both organized and ordered by the Russian state, by the Russian security services.

Now, Jim, the Russians continue to deny that is the case. Now the U.S. believe that this offer was never really a serious counteroffer when it was made a couple of weeks ago simply because Vadim Krasikov is a German prisoner. He's not a U.S. prisoner, so therefore why should he be part of the prisoner swap between the U.S. and Russia. However, we do know from a senior German source that the U.S. did reach out to the Germans on a fairly low level and fairly quietly just to inquire about what was up with Vadim Krasikov.

The Germans say from their vantage point they never really took that seriously and certainly no action was taken. But we do know, Jim, that obviously the U.S. with that show, that it was very serious, and is serious about getting both Paul Whelan and Brittney Griner out of Russia and bring them back home to the United States. Now in part that is of course because Brittney Griner's trial is now moving into an extremely important phase of that trial. It's the last couple of hearings.

We do know that Brittney Griner right now is somewhat nervous but very focused on preparing. I was actually able to speak to her legal team about how she's doing, how she is preparing in these very important days. Here's what they had to say.


PLEITGEN (voice-over): WNBA star Brittney Griner focused on the final and decisive phase of her trial for drug charges in Russia. Speaking to CNN right after visiting her, Griner's lawyer says the athlete is keeping the faith.

MARIA BLAGOVOLINA, BRITTNEY GRINER'S RUSSIAN COUNSEL: As it starts, she is, of course, stressed and quite nervous. And she knows that the end of the trial is approaching. But she really appreciates all the support she's getting.

PLEITGEN: Griner's legal team is building their strategy on efforts to get leniency from the court by showing remorse for trying to enter the country with vaping cartridges containing cannabis oil.

BRITTNEY GRINER, WNBA STAR: I do understand what my charges are against me.


And with them being accidentally in my bags, I take responsibility. But I did not intend to smuggle or plan to smuggle anything into Russia.

PLEITGEN: The legal team believes so far their approach has worked, as well as possible in a Russian court.

BLAGOVOLINA: The court is receptive. The court listens. The court accepts -- almost accepted already almost all our evidence. So I think that like procedurally it's going how it went.

PLEITGEN: But conviction rates in Russia are well over 90 percent. And Brittney Griner faces up to 10 years in prison if found guilty. The U.S. has been frustrated by a lack of progress trying to organize a prisoner swap with Moscow to get both Brittney Griner and former Marine Paul Whelan, who is currently serving a 16-year sentence for alleged espionage which he denies, released. Secretary of State Blinken saying he raised the issue with the Russian

Foreign minister in their first phone call since Russia invaded Ukraine.

ANTONY BLINKEN, SECRETARY OF STATE: I pressed the Kremlin to accept the substantial proposal that we put forth on the release of Paul Whelan and Brittney Griner.

PLEITGEN: But the Russians have made clear they don't want to speak publicly about prisoner swaps.

SERGEY LAVROV, RUSSIAN FOREIGN MINISTER (through translator): This topic was discussed over a year ago during the Geneva meeting between Presidents Putin and Biden. There, they agreed to authorize competent people to deal with these issues. The Foreign Ministry is not one of them.

PLEITGEN: Brittney Griner's legal team says they have not been made aware of any negotiations and are only focused on the tough legal battle ahead.

BLAGOVOLINA: She asked to say that she loved everybody. She misses her family, of course, her wife. And again, she appreciates a lot, the huge support she's getting from (INAUDIBLE) and other WNBA, from the sports community in the USA and Russia, worldwide. So she's just very, very grateful and it's really means a lot to her.


PLEITGEN: And Jim, Brittney Griner's lawyers, her defense team, said that it was very important for Brittney Griner to know that that statement was out there, that Brittney Griner's fans and all those who are supporting her understand how grateful she is for that support and that she right now is trying to remain strong in these very important days that are ahead for her and her possible freedom that obviously she's fighting for.

As far as her legal team is concerned, they obviously said as we just heard that they are very focused on the trial, and hoping to get the best outcome. But they also say if a prisoner swap happens they certainly wouldn't be against it. They want Brittney Griner to come home as fast as possible -- Jim.

ACOSTA: Certainly a lot of people here in the United States who feel the same way.

All right, Fred Pleitgen, thank you very much for that report.

Coming up, incredible video posted on social media of what some experts believe could be images of a Chinese rocket burning up in the atmosphere. While CNN cannot confirm the veracity of this video we are learning details about where it landed. That's next.

You're live in the CNN NEWSROOM.


ACOSTA: Developing now, debris from a 23-ton Chinese rocket booster just hurdled uncontrollably back to earth.

Sky watchers on social media have been posting videos of what some experts believe could be images of the rocket booster burning up over Malaysia. CNN could not confirm the veracity of those images.

What we know from U.S. Space Command is the booster reentered over the Indian Ocean a short time ago. It's been in orbit for less than a week after delivering a new module to China's new space station.

This is not the first time China has been accused of improperly handling space debris.

Joining me now is Jonathan McDowell, astrophysicists at the Harvard and Smithsonian Astrophysicists.

Jonathan, great to see you again.

You've been following the movements of this debris. What's your sense of where it landed? You know, do you think there were any areas on dry land where people are that were in danger at any moment in all of this? What's your take on all of this?

JONATHAN MCDOWELL, ASTROPHYSICIST, CENTER FOR ASTROPHYSICS, HARVARD & SMITHSONIAN: Well, we do know now that the rocket reentered in Malaysia, the eastern end of the Indian Ocean. So it came in kind of over the capital headed east and probably the debris hit the surface a few hundred miles east of there. I

t's not clear yet whether it hit actually on the island of Borneo or into the sea. So we have to wait until anyone -- it's great to get the videos, which I think are authentic of the thing breaking up in the sky.

But we want to know did any of the pieces sit on the ground? That may take a while longer for the reports to filter back.

ACOSTA: Why is it so hard to figure out where this debris is going to land? I feel like this comes up every now and then.

And we're all looking up into the sky, almost out of a scene from "Don't Look Up," wondering where the rocket is going to land. Why don't we have more control over the situation than this?

MCDOWELL: Right. Normally, when we put a big rocket in orbit, we have a restartable engine and dive it into the ocean, a particular place under control.

But this Chinese rocket doesn't do that. It's left in orbit. It's at the mercy of the upper atmosphere wind. At some point, it breaks up and reenters. You can't predict when it's going to be in advance.

[15:35:08] And because it's traveling at 17,000 miles an hour, if you're an hour out, and when you guest it's going to break up, you're 17,000 miles out in where it's going to land. So it's a hard problem.

ACOSTA: Certainly is.

And this is not the first time that China has allowed space debris to fall to the earth like this.

Is this a matter of China not caring where its debris is going to land from outer space? Is it a matter of their capabilities are just not where the rest of the world is? What's going on?

MCDOWELL: Yes, I think they just are not as concerned about public risk.

To be fair, we've had stuff reenter from U.S. satellites, there was a piece of a SpaceX Dragon ship that crash landed in Australia a week or so ago. But they're much smaller objects that we allow to reenter. No other country leads these 20-ton things in orbit to reentry.

That's on China for designing its rocket that way and not taking the measures that other countries do to prevent that from happening.

ACOSTA: All right. Perhaps they'll acquire that technology one of these days, as the Chinese sometimes do.

Jonathan McDowell, thank you very much for your time. We appreciate it.

MCDOWELL: Thank you.

ACOSTA: Speaking of lucky breaks, someone woke up a jackpot winner this morning. One ticket sold for the second-largest jackpot in Mega Millions history. The details ahead.



ACOSTA: Have you checked your Mega Millions ticket yet? There are the numbers there. There was a single jackpot winning ticket sold in last night's $1.3 billion drawing.

It was sold just outside of Chicago. The largest lottery prize won in the state and the third-largest in the U.S.

The Illinois lottery director said they have not yet heard from the winner but they have a year to claim the prize. If they choose the lump sum, they walk away with $780 million.

So if you bought your ticket at a Speedway in Des Plaine, Illinois, check your tickets.

You might want to check under the seat in your car, something like that. Maybe you dropped it somewhere. Make sure you have your ticket on hand for you.

In the meantime, as Americans contend with sky high gas prices, oil companies are cashing in and posting massive profits. This latest quarter, Exxon made more than $17 billion.

That breaks down to more than $2,200 per second. More than many Americans make per paycheck.

Put another way, in the two minutes it takes to pump 20 gallons of gas, Exxon has pocketed a quarter million dollars.

Joining me to talk about this is former Labor Secretary Robert Reich, who is the author of "The System: You Rigged It and How We Fix It."

Robert Reich, great to see you again.

You tweeted about this, said, "This is what an oligarchy looks like this."

We talked about it several weeks ago when you said these oil and gas companies are running off with record profits. And now we have the numbers to say that's what's going on. So what's the solution?

ROBERT REICH, FORMER LABOR SECRETARY: Well, the solution, Jim, is exactly what the conservative government in Britain has done.

In fact, many other European governments have followed in their wake in imposing a windfall profits tax on the oil companies that essentially removes their incentive for jacking up prices so much higher than their costs.

That's where these profits are coming from. It's the gap between what the oil companies are paying for crude and what they are actually selling their gas at the pump is.

That keeps on growing. That's why they're making so much money. It's not just Chevron and Exxon, the biggest U.S. oil producers and gas producers, but also Shell and many of these worldwide oil companies are raking it in on the backs of consumers.

ACOSTA: In the meantime, you know President Biden is trying to ease fears about a possible recession coming upon us after numbers show the U.S. economy shrank for the second quarter in a row.

Let's listen to what the president said about it.


JOE BIDEN, PRESIDENT OF THE UNITED STATES: We have a record job market of record unemployment of 3.6 percent today. We've created nine million new jobs so far just since I've become president. Businesses are investing in America at record rates. That doesn't sound like a recession to me.

(END VIDEO CLIP) ACOSTA: Now, a new CNN poll that came out before all of these grim numbers found 64 percent of Americans think we're already in a recession. And that majority holds across Republicans, Democrats, Independents.

What do you think about this, Secretary Reich? Are we talking ourselves into a recession? Are we talking about it so much that we're convincing ourselves we're in a recession and so people are pulling back on spending and so on? What do you think?

REICH: There's always a danger of a self-fulfilling prophesy when talking about economies, and specifically recessions.

But most Americans have a good idea what's going on for them. And what is going on for them, is that although their paychecks may be increasing, the price of most stuff they're buying is increasing even faster. So the net result is they are getting poorer.

And that's really the issue here. It's not the number of jobs. It's actually -- it's the fact that inflation is taking away whatever pay increases American workers have been enjoying.

And that's the nub of the problem. That's why inflation has got to be trimmed.


But it's also why big companies that are pushing up prices because they can get away with it, they have so much market power, really are at the root of the problem.

And as the Fed continues to raise interest rates to slow the economy, the irony may be that the people who are hurt most are average working Americans who either lose their jobs or face higher and higher interest rates on everything from credit cards to their mortgages.

ACOSTA: And, Secretary Reich, Senate majority leader, Chuck Schumer, Senator Joe Manchin they agreed to a surprise energy deal. This took a lot of people by surprise here in Washington.

A big package, $369 million that would do a lot of things. One would be making the biggest climate investment, allowing Medicare to negotiate prescription drug prices, also extend Obamacare prices for three years.

How much will this help bring down inflation and perhaps get this under control and maybe prevent a recession from taking place? Your thoughts?

REICH: I think it will help undoubtedly. It's a huge victory for the Democrats if it can get through the Senate. We don't know that for a fact.

Joe Manchin is not the only Senator holding up the works. But if it gets through the -- even the tax increases on the wealthy and big corporations will help. You have all -- you know, 15 percent minimum tax on corporations. That

means that you are going to have a slight downward effect on demand. And inflation is a product of too much demand and too little supply.

So that's -- you know, even the tax part of it is going to help.

ACOSTA: You previously made a pitch to Democrats that maybe it's time to kick Joe Manchin out of the Democratic Party.

What do you think, Mr. Secretary? Did this deal change your mind? Are your eyes out on a Senator from Arizona?

REICH: Let's find out whether we get this actually through.

This could be the largest single climate initiative passed in the United States history at a time when most Americans are directly or indirectly feeling the effects of climate change.

So if Joe Manchin, regardless of how he has acted in the past, if he champions this and follows through -- again, I say if because there have been several times before, Jim, you know as well as I, that Joe Manchin has said one thing and at the last minute done something completely different.

But if he follows through and also if Kirsten Sinema gets on board and the Democrats get this done, a huge plus.

ACOSTA: They have their eyes on the rugs at the White House to make sure they're not pulled out from under them at this point. No question about it.

Secretary Robert Reich, thank you very much for your time. We'll get you back here soon. Thanks very much.

REICH: Thanks, Jim.

ACOSTA: All right. And we'll take a quick break. We'll be right back.



ACOSTA: Developing now, thousands of antigovernment protests in Iraq are escalating with demonstrators breaking into parliament for the second time in a week.

The protests erupted after demonstrators broke into Baghdad's heavily fortified Green Zone. They were upset by the nomination of a new prime minister. They're loyal to the powerful cleric whose own attempts to form a government have repeatedly foundered.

Iraq has struggled to form a new government since parliamentary elections last October. Iraqi state media is now reporting that parliament will be suspended until further notice. We'll keep an eye on that. It's a land of extremes where wind speeds soar above 100 miles per hour and giant waves batter the coastline. Tomorrow night, CNN ventures into Patagonia's far south, closer to Antarctica than anywhere else on earth.

Here's a preview.


NARRATOR: On average, a volume twice the size of the Empire State Building crashes into the lagoon every day. And the fractured ice flows hide a formidable predator. A leopard seal.

Normally, they live and breed almost exclusively in the Antarctic where penguins are one of their main prey.

But in the San Rafael Lagoon, more than 1,200 miles from Antarctica, there are no penguins and it's a mystery how these seals are surviving here.


ACOSTA: Be sure to tune into "PATAGONIA, LIFE ON THE EDGE OF THE WORLD." It airs tomorrow night at 9:00, right here on CNN.

This week's "CNN Hero, Carie Broecker, is on a mission to help seniors of all kinds, the two-legged and the four legged.


CARIE BROECKER, CNN HERO: Peace of Mind Dog Rescue has a dual mission, helping senior dogs and senior people.

We take in dogs from senior citizens who can no longer care for them or who have passed away, and we also take in senior dogs from animal shelters.

Yes, definitely a Peace of Mind Dog.

We have found homes for almost 3,000 dogs. And we have helped close to 2,000 senior citizens.


UNIDENTIFIED MALE: She looks happy.

BOECKER: In our society, sometimes the elderly, whether that is senior people or senior dogs, get ignored. And so we really want to cherish all of life.


ACOSTA: To see all the many ways that Carie is helping senior citizens and those wonderful senior dogs, go to

We'll be right back. (COMMERCIAL BREAK)