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White House Issues New Statement on Biden's Classified Documents; Rep. George Santos (R-NY) Refuses to Answer Questions About His Past Lies; Biden Addresses Economy and Efforts to Tackle Inflation. Aired 10:30-11a ET

Aired January 12, 2023 - 10:30   ET

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

[10:30:01]

JEREMY DIAMOND, CNN WHITE HOUSE CORRESPONDENT: In fact, they very much left the impression that this was a comprehensive search that had been done and didn't leave the impression that anything else was going to come out.

We know now, of course, that was not the case, that additional documents have indeed be found. And so this is the White House trying to put some kind of a bow on this. We will see if this time, if this is the final kind of comprehensive look at this search and the kind of potential documents that might be found. But as of now, they are indicating that they have completed a review of any potential locations where documents -- classified documents from vice presidency could be found.

ERICA HILL, CNN ANCHOR: Maybe an attempt to put a bow on it, but there is still, as you have pointed out and we've been talking about, there is still a number of unanswered questions, including what specifically is in those documents and why the first tranche, which was found in early November, why we're just learning about it now. Jeremy, I really appreciate this update. Thank you.

More House Republicans meantime are putting pressure on one of their own, pressure on Congressman George Santos to resign. House Speaker Kevin McCarthy not among them, though. New reaction from the Hill, next.

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[10:35:00]

HILL: Just minutes ago, newly elected Republican Congressman George Santos, who has been under growing pressure to resign after lying about his job history, his education, his family heritage, said, after several days saying simply no, he said he would resign under very specific circumstances. Take a listen.

(BEGIN VIDEO CLIP)

REPORTER: Your response for those that are calling for you to resign.

REP. GEORGE SANTOS (R-NY): I will not resign. I will be continuing to hold my office elected by the people.

REPORTER: Congressman, what is your reaction to members of your own party calling for your resignation?

REPORTER: if the voters ask for you to resign, will you?

SANTOS: If 142 people asked for me to resign, I'll resign.

(END VIDEO CLIP)

HILL: In response to that, Democratic Congressman Don Beyer tweeting, quote, pretty sure we can make that happen.

CNN's Manu Raju is live on Capitol Hill. Perhaps not surprising, Manu, I've already seen someone on Twitter starting a petition. But what are Republican lawmakers saying about all of this?

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Well, there is growing pressure on him to step aside. In fact, after Congressman Santos made those comments, I caught him in the basement of the Capitol walking back to the Capitol. I asked him about his apparent web of deceit, about his past, about everything, from having a family that fled the holocaust to his past background, to his educational background. He wouldn't answer any of those questions despite putting that question to him for about more than a minute.

But you have hearing some members of his own delegation, Republican members, even some incoming members, saying he simply cannot serve effectively. And if you just start listening to the calls from back home to step aside.

(BEGIN VIDEO CLIP)

REP. MARC MOLINARO (R-NY): He's lost the confidence of people in his own community. So, you know, I think he needs to seriously consider whether or not he can actually do his job effectively. And right now, it is pretty clear he can't.

REP. MIKE LAWLER (R-NY): I don't think there is any way he could possibly perform his duty, but the man has got to be honest with himself and his constituents. And it is just clear he can't do his job.

RAJU: So, are you saying he should resign?

LAWLER: There is no way I believe he can fully fulfill his responsibilities and I think he needs to take that very seriously.

(END VIDEO CLIP)

RAJU: But he does have support right now from Kevin McCarthy, the House speaker, who has not called him to resign, simply saying it is up to the voters to decide and that will be significant going forward. McCarthy is scheduled to answer questions here in a matter of minutes, unlikely to change his posture because, Erica, the political reality is if Santos were to resign, this would be a prime Democratic pickup opportunity in a special election and that could tighten Kevin McCarthy's margin in the House if Democrats were to pick that up. Erica?

HILL: We know it is all about the numbers. That is certainly the game right now. Manu Raju, I appreciate it. Thank you.

An impassioned plea from the wife of Alexei Navalny asking Russian prison officials to get him desperately needed medical care, something he says he is being denied. Just ahead, we'll hear from his chief of staff on the conditions Navalny is facing inside that Russian penal colony.

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[10:40:00]

HILL: We're going to bring you right now President Biden speaking, making remarks, as expected, on the economy and inflation. Let's take a listen.

JOE BIDEN, U.S. PRESIDENT: But good morning. Today we have got some good news, good news about the economy. For the sixth month in a row, inflation has come down. Measured over last 12 months, it has fallen to 6.5 percent. That is down from 7.1 percent the month before. And it is down from 9.1 percent this summer. Inflation is now as lowest level since October of 2021.

When we look at just the last three months, we see that inflation fell to 1.8 percent on an annualized basis. It is down for more than 11 percent in the first three months of last year. So, the data is clear. Even though inflation is high and major economies around the world, it is coming down in America month after month, giving families some real breathing room.

And the big reason is falling gas prices. My administration took action to get oil on to the market and bring down prices. Now, gas is down more than $1.70 from its peak. That adds up to a typical family with two vehicles to a savings of $180 a month every single month. That stays in their pockets instead of being spent at the pump.

Food inflation is slowing as well. Last month, we saw the smallest increase in food prices in almost two years. And much of that increase was due to the avian flu outbreak, which has driven up the egg prices in the United States.

It is not just gas and food prices, though. When we look at what the economists call core inflation, which takes out energy and food, we see welcome news as well. Core inflation is down to the lowest level in a year. Over the past three months, core inflation has come down to 3 percent on an annualized basis. That is down from more than 6 percent at the beginning of 2022. The cost of goods is actually falling. As prices, from everything, from computers to used cars, are coming down as well. And inflation in core services is moderating as well.

And as inflation is coming down, take-home pay for workers is going up. Workers' wages are higher now than they were seven months ago adjusted for inflation.

[10:45:02]

Wages for lower income and middle income workers have gone up even more. It all adds up to a real break for consumers, real breathing room for families and more proof that my economic plan is working.

When I came to office almost two years ago, the economy was flat on its back, as you all remember. Millions of people had lost their job through no fault of their own. Millions, millions who kept their jobs saw the hours and paychecks cut. Hundreds of thousands of small businesses permanently closed their doors. People were hurting badly.

That is what we inherited. The pandemic that was raging and the economy was reeling. We acted decisively to put in place a new strategy that would rescue the economy from the pandemic downturn. At the same time, we laid the foundation for a stronger, more resilient economy for decades to come, an economy that grows from the bottom up and the middle out.

Now two years in, it is clear, clearer than ever, that my economic plan is actually working. Here is what we've learned just last week. Unemployment is the lowest it's been in 50 years. I say that again, the lowest unemployment rate in half a century. My first two years in office were the two strongest years for job growth on record. We created nearly 11 million jobs, including 750,000 manufacturing jobs. And they were two of the strongest years ever for small business creation as well.

And today, unemployment rate is near record for lows for blacks and Hispanic, black and Hispanic workers, near record lows. That is the lowest ever on record for people with disabilities.

We're seeing American families breathe a little easier. More Americans are health insurance than they did ever in our history. Fewer families are facing foreclosures today than before the pandemic and we still have more work to do, though, but we're clearly moving in the right direction. And there is more breathing room in store for American workers and families.

Starting last week, as of January 1, a month's supply of insulin is now capped at $35 for seniors on Medicare. Some are paying hundreds of dollars every month for their insulin, but not anymore. Starting last week, if big pharma raises prices faster than inflation, they're going to face big penalties. Starting last week, Americans get tax credits when they install energy-efficient appliances in their homes, like heat pumps or solar panels or when they buy electric vehicles. These are all pieces of what that big law that we passed last year. Now they're kicking in. And Americans are starting to feel the benefits in their everyday lives.

But that is not all. We're seeing historic investments in American manufacturing turning into new factories and jobs from Arizona, Ohio, Georgia, New York, companies have announced nearly $300 billion in manufacturing investments here in the United States since I became president. Instead of exporting jobs, like we did for decades, we're now creating jobs and exporting product. Creating jobs and exporting product, that is the idea.

Now, the House has elected a new speaker. I can call him and congratulated him and I'm ready to work with him or any Republican Congress to make progress for the American people.

But like many Americans, I was disappointed that the very first bill that the Republicans in the House of Representatives passed would help wealthy people and big corporations cheat on their taxes at the expense of ordinary middle class taxpayers and it would add $114 billion to the deficit, their very first bill. House Republicans campaigned on inflation. They didn't say if elected, they're plan was to make inflation worse.

Plus, House Republicans introduced another bill, blocking action that would help lower gas prices and help consumers. And on top of that, House Republicans are preparing to vote on a national sales tax bill, national sales tax. That is a great idea. It would raise taxes on the middle class by taxing thousands of everyday items, from groceries to gas, while cutting taxes for the wealthiest Americans. And if I'm not mistaken what they're going to do, this would also totally eliminate the IRS. It feels good, except all are going to be sales tax. Go home and tell your moms. They're going to be really excited about that.

Come on. Is this how the House Republicans are starting a new term, cutting taxes for billionaires, raising taxes for working families, making inflation worse? Well, let me be very clear. If any of these bills make it to my desk, I will veto them.

[10:50:02]

I will flat veto them. I'm ready to work with Republicans, not on this kind of stuff. They try to cut social security and Medicare, which Americans have been paying into every paycheck since they ever got their first paycheck. I'll use my veto pen to stop that as well. But if Republicans want to work together on real solutions to lower inflation, create more jobs, build an economy that works for everyone, I'm ready.

Let me close with this. Today's inflation numbers are good news, good news about our economy, but we have more work to do. But we're on the right track. We're seeing bright spots across the country where great things are happening. Roads and bridges are being built, factories are coming online, people back to work again, families breathing a little bit easier. That is why I can honestly say, and you've heard me say this before, and I mean it from the bottom of my heart, I've never been more optimistic about America's future than I am today. We just have to remember who in God's name we are. You've heard me say it many times, this is the United States of America. There is nothing, nothing beyond our capacity if we work together. So God bless you all and may God protect our troops.

REPORTER: Mr. President, classified material next to your corvette, what were you thinking?

BIDEN: Let me -- I'm going to get a chance to speak on this, God willing soon. But as I said earlier this week, and, by the way, my corvette is in a locked garage, okay? So, it is not like they're sitting out on the street.

REPORTER: (INAUDIBLE) it wasn't a locked garage.

BIDEN: Yes, as well as my corvette. But as I said earlier this week, people know I take classified documents and classified materials seriously. I also said we're cooperating fully and completely with the Justice Department review.

As part of that process, my lawyers reviewed other places where documents from my time as vice president were stored and they finished the review last night. They discovered a small number of documents of classified markings in storage areas in file cabinets in my home and in my personal library.

This was done in the case of the Biden Penn -- this was done in the case of the Biden Penn Center. The Department of Justice was immediately -- as was done, the Department of Justice was immediately notified and the lawyers arranged for the Department of Justice to take possession of the document. So, you're going to see -- we're going to see all of this unfold. I'm confident -- thank you very much. Thank you.

REPORTER: How is the first lady, sir?

BIDEN: She's doing really well. She was under a long time for five hours because what they were doing is they take out (INAUDIBLE), meaning remove what they thought might be cancerous and then they have to then go back and test it and see what it was. But she's doing really well. She's up. We had breakfast this morning and she's recovering. And she's going to be sore for a while because of the work they did on her eyes and that is for one of these were, but she's -- 0 to 1 percent chance of ever returning of any cancer. And so thank God she is doing really well. Thank you for asking.

HILL: President Biden there answering two very different questions, one about the first lady's health, after we learned she had two cancerous lesions removed, and another, which many have, a question about these classified documents, additional documents which were found at the president's home in Delaware.

Let's bring in CNN White House Correspondent Jeremy Diamond and CNN Chief Business Correspondent Christine Romans as well.

So, Jeremy, I'm going to start with you. This was a pre-planned moment for the president to talk about the economy, to talk about the CPI numbers that were out today, the decrease we've seen in inflation, perhaps not surprisingly the first question, though, that he was asked was about these documents. And this comes on the heels of a statement that you just brought us a short time ago from the White House about what additionally was found. I'm curious, what did you make of his answer there, Jeremy?

DIAMOND: Well, yes. You saw the president attempting to read at times it seemed from the same statement or very similar statement from the one that we saw from the White House Special Counsel Richard Sauber on these documents. The president was addressing a question about why and how he could be so careless as to leave classified documents in his garage at his private home. One of the first things that the president pointed out was that it was a locked garage. Of course, that doesn't mean that that's an appropriate space for classified documents to be but certainly a point that the president wanted to make there.

He reiterated some of what we had heard from the president during that news conference earlier this week in Mexico City after that initial batch of documents was revealed to have been found, and that is that the president said repeatedly, people know I take classified documents and classified terms seriously.

[10:55:16]

And he reiterated that he and his attorneys are cooperating with the Department of Justice.

He pointed again that the second batch of documents that was discovered in his Wilmington, Delaware residence was handed over to the Department of Justice. Notably, initially, that initial batch of documents, you may recall, Erica, they had notified the National Archives and turned it over to them. But now, of course, we know that there is this Justice Department review that has been underway. And so it seems like they just went straight to the Department of Justice in this case.

Again, a number of questions that the president was not answering there as well, but he did try and address and address the fact that these documents were indeed found and provide a little bit of context around where that was.

HILL: Well I know that you will keep digging along with our entire White House team on some of those questions.

Christine, let's dig deeper on this CPI data and what we heard from the president. He was saying very clearly this is a break for consumers, it gives them breathing room, touting the decline in both inflation and gas prices, saying, my economic plan is working. There are also Fed rate tikes coming that are appear to be working.

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: And there will be coming two more Fed rate hikes in this economy, for sure, this year. But he's trying to pull it all together, talking about the cap of insulin prices and E.V. tax breaks that are now live and sort of new things that have been part of his agenda that the American people will start to feel this year.

But the headline, of course, is that those inflation numbers that have been too, too high for too, too long are starting to curve. And he pointed that six months now of slowing headline inflation and he zeroed in on this super core rate of inflation when you strip out shelter and used car and food and energy. And he pointed out that over the past three months, that's been running at more like a 1.8 percent annualized rate. So, really, the inflation, bad inflation story is from the first half of last year and he's sort of turning the page into 2023 here. HILL: And now we'll wait and watch, right, because the Fed -- we have about 15 seconds left but the Fed is meeting again next month. But we could see another rate hike but it's expected to be lower.

ROMANS: It would likely be less aggressive Fed rate hikes but the Fed is still trying to tackle inflation this year, yes.

HILL: All right. We'll watch and we'll continue drilling down the numbers, as always, with you. Christine and Jeremy, I appreciate it. Thank you both.

Thanks to all of you for joining us today. I'm Erica Hill.

Stay tuned. At This Hour with Kate Bolduan coming your way after a real quick break.

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