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CNN International: Fed Holds Interest Rates Steady After Positive Inflation Report; Blinken: Gaps With Israel & Hamas On Ceasefire Are "Bridgeable"; Biden Heads To G7 In Italy After Son's Guilty Verdict; CNN Gets Rare Access To Camp For ISIS Families. Aired 3-4p ET

Aired June 12, 2024 - 15:00   ET

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

[15:00:40]

ERICA HILL, CNN HOST: It is 8:00 p.m. in London, 9:00 p.m. in Apulia, Italy, 3:00 p.m. in Havana, and right here in New York.

I'm Erica Hill. Thanks so much for joining me today on CNN NEWSROOM.

Let's get you right to the news.

We begin with the state of the economy. Here in the U.S., two key numbers out today and just the last hour as expected, the U.S. Federal Reserve chose to leave interest rates unchanged. So, that means borrowing costs and everything from car loans to mortgages remain at 23-year high. This comes on the heels of some welcome news earlier today, news for consumers. Inflation rather slowed unexpectedly according to the latest numbers from the federal government.

CNN's Matt Egan covering the economy for us here, going to break it all down.

So, Matt, lets start with these interest rates. As expected here, no change from the Fed.

MATT EGAN, CNN REPORTER: That's right, Erica. Interest rate staying on hold, so that really means no relief for borrowers in terms of mortgage rates, credit cards, car loans. They're all going to stay high for now.

The good news is the Fed is keeping the door open to lowering interest rates, later this year. Now you may recall a few months ago, the Fed was projecting three rate cuts this year, but that looks pretty unlikely even after today's inflation report.

So, now, the Fed is signaling just one interest rate cut. There's only four meetings left. The last meeting before the election is September. Markets are pricing in basically a two in three chance of an interest rate cut by that September meeting.

And, of course, this is going to have a huge impact on the economy, how people are feeling, also could have an impact on the election in terms of how voters are feeling about the cost of living, about the cost of borrowing. Now, Fed chair Jerome Powell, he's holding a press conference right

now and he was asked about the inflation situation.

He said inflation is, quote, still too high, but he did weigh in on today's better-than-expected inflation report. He said it was better than almost anybody anticipated. He said he sees it as progress and building confidence, but, Erica, this is key.

He says that they don't have confidence yet to lower interest rates.

HILL: So not quite there yet. This report also, should it change in some prices? I know that housing right, remains stubbornly high, but perhaps some better news when it comes to foods sort of stagnant and gas a little bit better.

EGAN: Yeah, absolutely. So we actually saw month over month inflation was unchanged. It's the first time we're seeing that in almost two years. And that was because we actually saw price drops for airfare, for gasoline, for clothes and new cars. And on the food front, we have seen some progress both for food that you buy at the grocery store and at restaurants. So that has certainly been encouraging.

But you touched on it, Erica, shelter, right? The cost to rent and to maintain a home, that has been a major pain point for Americans and it's still too expensive, right? Prices are still going up on the shelter front. It's been really slow in terms of progress there.

And so, listen, I think the Fed wants to see more progress before they're going to start lowering interest rates. And, you know, the good news, of course, is that the jobs market, I mean, Jerome Powell was asked about that and he said the jobs market, of course, has cooled off.

He said it was too hot, right? It was overheating a year and two years ago, so he's happy that there's been some progress in terms of moving things into better balance between supply and demand because you don't want to see it overheat. That's encouraging, right? We've seen the unemployment rate remained near historic lows, hiring continues. It's just the cost of living that remains a problem.

So I think big picture today represents progress. We just need to see more progress before we get relief on the borrowing front -- Erica.

HILL: All right. So and so then the countdown it to September. And the questions that were man until then begins, Matt, appreciate it. Thank you.

EGAN: Thanks.

HILL: Let's continue this discussion now with CNN's Julia Chatterley who joins us.

So, in terms of, Julia, the Fed's decision to keep interest rates where they are, that was largely expected. There are these questions now, of course, about September what will it take for a lowering of those rates in September? Is it simply about inflation? JULIA CHATTERLEY, CNN ANCHOR AND CORRESPONDENT: Yeah, and Jay Powell was off that today in terms of those inflation prints and to what extent we need inflation to come down.

You remember, the Federal Reserve for always very careful and calibrated. If you look at some of their forecasts then not anticipating inflation you should really to come much further down from where we are at this moment.

[15:05:08]

So that's one of the key challenges. The other part of their mandate, remember, Erica is not inflation. It's jobs and we just got that really strong jobs numbers last week as well. So when you tie the two things together, and Jay Powell said it today, he said, look, we think our policy at this moment is about appropriate for the resilience that were seeing in the American economy.

And I kind of agree with him quite frankly, Ive go out on a limb again on this show and say, I'm not sure I see the Federal Reserve cutting rates before the presidential election.

HILL: So it could not happen then until December, which would be the next option after September?

CHATTERLEY: Well, that's exactly what ties with what the market is saying. There is one in November, there's a meeting in November, but that would be very difficult for them to move. So, yeah, that pushes it back to December and it ties with what investors are thinking at this moment.

And remember, investors came into this year thinking they could see five to six quarter-point cuts. And here we are today saying the Fed is saying perhaps just one. And I think that's still a very cautious number. Four Fed members coming out in this meeting basically and saying, we don't think we'll cut at all.

So watch this space. Not good news if you're an American borrower.

HILL: Well, not if you're a borrower and if you're a borrower wants to buy houses. Matt and I were just talking about the cost of shelter, the cost of housing, whether you're renting or buying continues to be a real issue. In fact, some people staying in their homes as you well know, because it costs too much to move and to find another home.

How closely is the Fed eyeing that aspect of this and how much do you think these housing costs are going to be connected?

CHATTERLEY: It's such an important question. The Fed is laser focused on housing costs and what we saw in the inflation print today is the unfortunately were still seeing shelter as they call it, housing costs rising an incredibly fast rate at around 5 percent according to this latest reading.

The fear with what the Fed focuses on is that it puts too much emphasis on shelter, on housing, and on rent. And that means if you still continue to see high pressure in prices there and in the level that that's at, it doesn't allow them to ease rates.

Some other measures, see certain elements of cooling in this. And I think the danger is over-emphasis on this means that they don't bring rates down and that doesn't bring mortgage rates down. So, Erica, I wish I had better news on that front, but I don't.

HILL: Yeah. Yeah.

Well, as we continue to watch that, I do want to ask you about what happened in the EU today. A big decision too sharply, sharply increased tariffs on electric vehicles that are made in China. What's behind that move, Julia? And what's the -- what's the fallout from it?

CHATTERLEY: Chinese automakers have made huge inroads into Europe. Five years ago, just 0.5 percent of new car sales, EVs I'm talking about in Europe came from China. Today, it's around 9 percent. So, Chinese manufacturers are moving incredibly quickly to boost their market share in Europe.

And that's a problem for European manufacturers of EV vehicles. It's good news if you want to clean up the planet, bad news for the European companies that are trying to boost their sales in Europe. And they've because he said to the governments, hey, we need to do something.

It's exactly what America was watching. And the reason why America rose tariffs just recently, too, because they're trying to stop China doing in Europe, the same thing in the United States. So, it certainly doesn't surprise me. It's not good news perhaps for the planet but it is good news for European manufacturers.

The question is, how did the Chinese now respond? Lots of luxury goods, of course, go from Europe to China. So watch tariffs on them now to.

HILL: Yeah, we will be watching that space.

Julia, appreciate it. Thank you. And I know you'll have much more ahead in the next heroin right here on CNN on "QUEST MEANS BUSINESS". We'll see you then.

Still to come this hour, Russian ships, including a nuclear-powered sub arriving in Cuba. Two Cold War allies strengthen their ties. That's next.

(COMMERCIAL BREAK)

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HILL: Welcome back.

U.S. Secretary of State Antony Blinken says Hamas has proposed numerous changes to the ceasefire deal, some of which he believes are workable, though not all. The secretary weighing in a short time ago in the state of negotiations as he wrapped up his visit to the region.

(BEGIN VIDEO CLIP)

ANTONY BLINKEN, SECRETARY OF DEFENSE: If one side continues to change its demands, including making demands and insisting on changes for things that had already accepted, you have to question whether they're proceeding in good faith or not, but based on what we've seen and what I've discussed with the prime minister of what we discussed with our Egyptian colleagues, we're determined to try to bridge the gaps.

And I believe those gaps are bridgeable, doesn't mean they will be bridged because again, it ultimately depends on people saying yes.

(END VIDEO CLIP)

HILL: Well, as the work continues, a scathing new report from the U.N. finds both Hamas and Israel have committed war crimes and other violations of international law since October 7, Israel responding by accusing the U.N. of being anti-Israel.

Meantime, tensions continued to rise on Israel's northern border. The IDF confirming they killed a key Hezbollah leader and three other fighters in southern Lebanon on Tuesday. The Iran-backed militant group responded by firing 200 rockets into Israel.

CNN's Oren Liebermann is in the Tel Aviv at this hour.

So, Oren, first, let's start with that ceasefire proposal. Blinken reiterating here the deal is nearly identical to the one that Hamas had proposed several weeks ago. So then what changed for Hamas?

OREN LIEBERMANN, CNN PENTAGON CORRESPONDENT: So, Secretary of State Anthony Blinken and you heard it in that quote we just heard from him clearly frustrated with Hamas and believing it's on them. The responsibility is on them at this point to say yes, Blinken and other U.S. officials have reiterated that Israel is on onboard with his U.S.-backed proposal, much of it is Israel's proposal, in fact. And he pointed out that a lot of it is what Hamas put forward on May 6.

And yet a senior U.S. official says Hamas has moved the goalpost and even Blinken made reference to this, saying that Hamas is now trying to change proposals are parts of the ceasefire deal that they had already agreed to. That's why he questioned without naming Hamas specifically whether they were negotiating in good faith here.

So that's the difficulty right now. Essentially, this is stumbling right now, or at least may stumble, were so many other negotiation efforts have stumbled before. And that is in the details, and that according to Blinken and a source familiar with the talks is what Hamas is proposing to change here.

Blinken said some of those changes are workable, some are not Blinken, clearly not giving up here. He said they'll keep working. The countries have said they will also keep working. So they see a window of opportunity here and they're trying to seize on it. It's also worth noting that Blinken talked about the day after saying that has to be worked on. The U.S. and even members of Israel's own government have criticized

Prime Minister Benjamin Netanyahu for not having or putting forward a day after plan.

[15:15:07]

Blinken said that's necessary to get from temporary fire to permanent ceasefire. And he also said that the U.S. will put forward its own day after proposal in the coming weeks.

So at least the effort is still there, but you could hear it with Blinken that he knows this is the critical moment here, that everything depends on, and there is no plan B either.

HILL: Also important to point out. Oren, appreciate it. Thank you.

Well, as these negotiations for a ceasefire and hostage deal remain in limbo. There are some new details of what the last several months in captivity were like for four recently rescued hostages. Some of those details emerging is the push continues, of course, for the families with the 100, hostages still being held.

On October 7, Andrey Kozlov was working as a security guard at the Nova music festival when he was kidnapped by Hamas forces. On Saturday, he was one of the four hostages rescued by Israeli forces.

CNN's Paula Hancocks sat down with his family following their emotional reunion.

(BEGIN VIDEOTAPE)

PAULA HANCOCKS, CNN CORRESPONDENT (voice-over): When the Israeli military launched Saturday's rescue mission in Gaza, one of the hostages thought they had come to kill him.

Andrey Kozlov shouts his name in terror to the troops. His family says the Hamas guards told them for months the signs of rule they were hearing, what Israel trying to target them has ever causing trouble for the state.

His brother Dmitry tells me he didn't understand why the IDF came. He was afraid they came to kill him. It took some time to realize they had come to rescue him.

Psychological abuse coupled with frequent punishments marked Kozlov's captivity, according to his family.

They were trying not to leave marks, his brother says, because eventually it is their reputation, but they would still punish it this way or the other.

He has told us there is some moments he will never share with us, his father says, but what he did share is that at the hottest time of the day, they would cover him in blankets, it's a difficult or deal to be dehydrated through heat. Kozlov, 27-years-old, is a Russian citizen who move to Israel almost two years ago. He was working as a security guard at the Nova Music Festival on October 7th when he was kidnapped and taken into Gaza. His parents flew from Russia Sunday for an emotional reunion, one they hadn't dare to hope for after eight long months.

This is the best scenario we could have hoped for, his father says, to see him alive, to feel his presence and to hug him. It is outstanding.

His mother says, we are infinitely happy to see him. He laughs, he jokes, he enjoys communicating with all of us, with his family, with doctors, with the people who surround him.

His family says, Kozlov was shocked when Israel's Prime Minister Benjamin Netanyahu came to visit him. And the three other hostages rescued while in hospital.

As for those hostages still in Gaza, his father says a deal or a rescue, whatever it takes to get them out.

Paula Hancocks, CNN, Tel Aviv.

(END VIDEOTAPE)

HILL: In a scene reminiscent of the Cold War, Cuba welcoming up fleet of Russian navy ships, including a nuclear-powered submarine with a 21-gun salute. The visit comes as tensions between the West and Russia continued to rise after President Biden authorized Ukraine to use U.S. weapons to strike inside Russia.

And while Cuba does have a history of hosting Russian ships, this visit is the largest of its kind in years. Pentagon officials telling CNN the visit does not pose a threat to the U.S. They are, however, monitoring Russia's military exercises.

Cuba's armed forces ministry says there are no nuclear weapons on board the Russian ships.

CNN's Patrick Oppmann is in Havana.

So, Patrick, we hear the diplomatic responses there. What about on the ground in Cuba, how is this visit being received? I understand they're actually going to be able to tour the main warship, that's the public.

PATRICK OPPMANN, CNN CORRESPONDENT: That is correct. And that is something that is exciting for the Cubans. You feel a little nostalgic about the old days when the Soviet Union really was footing the bill for Cuba. And, you know, you're talking about the submarine, warship, and those are just behind me over my shoulder here. It's not a site you see every day.

Certainly, the submarine that is a site that most Cubans have said they never have seen that a nuclear-powered submarine would come into the port of Havana. And this is about as a public high-profile place as you could expect to be. It's usually where cruise ships dock and today you have for Russian navy ships. So very clearly, the Russian military, Vladimir Putin, are trying to

send a signal loud and clear that if the U.S. can put weaponry on the borders of Russia, then perhaps they can do the same.

[15:20:09]

And yes, the U.S., Pentagon, military has said that this is not a threat. But, of course, they were shadowing these boats with their own military ships and military planes very, very closely. This is a cat and mouse game that you see across the globe as a different sides carry out their military -- their naval maneuvers.

So while there may not be nuclear weapons aboard, we are told, the ship behind me, the Gorshkov there, that is capable of shooting hypersonic missiles. It is cutting edge Russian technology. So, a very close eye being kept on these ships during this week, and as they continue their travels.

HILL: Yeah, absolutely. Patrick, appreciate it. Thank you.

When we return here, President Biden on his way to the G7 summit in Italy as the White House, of course, is balancing his role as commander in chief with his role as dad, the day after Hunter Biden's felony convictions? That's ahead.

(COMMERCIAL BREAK)

[15:25:02]

HILL: President Biden on his way to Apulia, Italy, where he is expected to push G7 leaders to unlock additional funding for Ukraine. His return to Europe, comes on the heels of an emotional reunion last night between the president and his son, Hunter, just hours after Hunter Biden was convicted of illegally buying and owning a gun while addicted to drugs.

CNN senior White House correspondent Kayla Tausche joining me now.

So, Kayla, the president really, right back at it at the G7 this week. Of course, he really just got home for France it seems like. Set to roll out a new security agreement with Ukraine.

What more do we know about that?

KAYLA TAUSCHE, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, we know, Erica, that this is going to be essentially a framework of cooperation between the two countries based on the experience over the last two years. It's expected to outline ways that the U.S. can continue coming to Ukraine's aid, arming Ukraine in its fight against Russia, as well as gaining some new intelligence and information about how certain weapons are being used on the battlefield, and monitoring where those weapons end up, responding to some criticism from Republicans about not being able to monitor all of the various military tools that the U.S. has been sending Ukraine.

National Security Adviser Jake Sullivan telling reporters that the deal will ensure you create and can defend itself today and deter future aggression as well. But the G7 nations are also expected to sign off on a financial pledge that would provide Ukraine up to $50 billion in the form of a loan based on Russian assets that are currently being held frozen in European banks.

There's been some last-minute negotiate patients on the ground in Italy among all of the nations, but senior officials still expect for that to be agreed upon this week, although there are certain parameters as to how Ukraine can use that money and how Ukraine must pay back that money and which countries are bearing the brunt of that risk.

But certainly it is a financial lifeline to Ukraine as political on financial wherewithal is wearing thin, Erica.

HILL: Yeah, absolutely. Kayla -- Kayla, appreciate it. Thank you.

When we look back at these last ten days for the president, they've been fairly busy. Executive actions on border security, marking the 80th anniversary of D-Day in Normandy, his son's felony convictions, big economic news today on inflation. And, of course, as Kayla was just laying out for us, this new security agreement with Ukraine.

With me now to discuss, Meghan Hays who worked in the Biden administration and Shermichael Singleton, Republican strategists and CNN political commentator.

Great to have both of you with me this afternoon.

So, Meghan, let's really just quickly put a bow on where we stand with Hunter Biden. The president had been asked prior, of course, to the conviction whether he would pardon Hunter Biden and his said no. The White House today though, did not rule out commuting an eventual sentence.

How do you expect the president to respond? Because we know he's going to get that question.

MEGHAN HAYS, CNN POLITICAL COMMENTATOR: Look, I think the president is going to respond that he is believes in the rule of law. He wants a court case to play out. I know that he and his statement that he put out the other day said whatever Hunter does with his appeal.

So I think the president is going to look at how this plays out and then they'll take the next steps. But I -- the president is a man of his word. And so I think we have to look for that, but I do think that he will just let this case play out and then they will address it probably after the election.

HILL: So, he'll hold off weighing after the sentencing, in terms of that commutation.

Shermichael, when we look at what's happening in Washington today, House Republicans laying out this three-pronged approach to hold the Justice Department accountable for what they say is a two-tiered system of justice, moving today to hold Attorney General Merrick garland in contempt of Congress over this dispute, right. Of the audio from interviews with a special counsel, Robert Hur, and President Biden.

This push, though, on a two-tiered system of justice, it seems to be wearing a little thing then after what we saw in the last 24 hours, do you think they need to shift the messaging?

SHERMICHAEL SINGLETON, CNN POLITICAL COMMENTATOR: No, I don't. I think they should shift the message from the former president to regular everyday American people, particularly American people of color, the former president has seen some entry from Hispanic men and African American men.

And, Erica, I can guarantee you can talk to almost any men of any of those two groups. They will tell you they absolutely believe the justice system is certainly not in our favor. And so, if Republicans really want to make this a more mainstream targeted conversation, then let's talk about the fact that men of color in particular are sentence far harsher than our white male counterparts.

I don't think the former president should make this issue about himself, it should be about the voters that he wants to vote for him this November.

Now to answer the question quickly, as it pertains to the Hur tapes, we saw the transcript. I'm not necessarily certain the audio is going to make a difference. I think more than anything, this is an attempt to utilize this as a political tool for people to listen to the president and for Republicans to say, oh, you see, there's something here. He paused for too long.

I'm not certain, Erica, that's going to really move the needle one way or the other. I would say move on and focus on other issues.

HILL: I do quickly follow up though. You said it would be great and I think you would really spark a conversation to your point if the conversation did shift a bit about the justice system in this country, in the way that you're proposing. But you said Trump needs to make sure it's not about him. Is he capable of that?

SINGLETON: Erica, that's a question I get all the time. If he wants to potentially win this election, he's going to have to put his pride to the side and become a more disciplined candidate.

[15:30:03]

If he continues to showcase and remind people of the person he was four years ago, then many voters are going to say this is not what we want. And I think that benefits President Biden and Democrats overall to make that contrast that you may not like President Biden, maybe you think he's too old, but do you really want another four years of this? And I think a lot of voters are probably going to say no.

So again, my best advice to Trump would be put your pride to the side and get disciplined if you want to win this thing. HILL: Meghan, some pretty positive news on the economy today, which,

of course, is exactly what the Biden campaign wants to see. It's what a lot of Americans want to see.

The issue though, as I know, you know, while the economy is a top issue for voters across the board, they still don't feel great.

So how do I -- no matter how much Joe Biden or the campaign or anybody else says, hey, things are looking up, if people don't feel it, it doesn't really matter. Do you think there was a message that Democrats are missing here?

HAYS: Yeah. I mean, I think that it's hard for people to understand when gas prices are so high or grocery prices are so high. You know, the president can't dictate prices from the Oval Office. He can only do things to help encourage consumers and other folks are in companies to look rates -- to lower those prices, excuse me.

And he's done that. You've seen in the past couple of weeks and months, Walmart and Target lowering the cost of everyday goods. He's doing other things like lowering prescription drugs and working on, you know, cutting student loan debt to give people a little break in their pocket book.

But I agree with you that unless they feel it, they're not going to necessarily understand that President Biden is working for them, and that is a hard thing to message. And so I think these are also incremental changes that need to happen and are happening, right? So maybe by an another month the employment rate still going down, inflation will still go down and people will start to feel a little bit more ease, which I do think is helpful to the Democrats.

But to Shermichael's point earlier, this, they need he just start focusing on the issues here and not on extraneous things like court cases and age, and focus on issues because that's really what people care about, because that's really how it's impacting them and affecting them every day.

HILL: So in terms of an issue, President Biden, obviously, on his way to Italy for what will be his final G7 meeting before Election Day, strengthening global alliances, standing with Ukraine -- these issues are very important personally to the president. His message has long been America is back.

Donald Trump is running once again on a far more isolationist worldview.

In terms of issues that matter to voters, Biden wants voters to care about America's standing in the world. But when they're looking at things like the economy, is there enough room there for both of these things to really be a messaging point?

HAYS: I think they both be things need to be true, and I think that people, Americans definitely need to be looking at both of these issues. And I understand that it's hard because it is such -- you know, defending democracy is hard to understand and grapple with when we live in America, but it is something that is important, having our allies supporting us and add our backs is important.

But also, it's important for pricing, for gas prices, for supply and demand issues like we saw the containers being held, the container ships being held early on in our administration, people couldn't get Christmas gifts. Those -- these are all things that matter and we need to tackle those. You know, that's a global issue. It's not just an issue in the U.S.

HILL: Shermichael, I only have about 15 seconds, but isolationism was actually kind of winning message for Donald Trump in 2016.

SINGLETON: It was --

HILL: Could it be -- could it be in '24?

SINGLETON: I think it's possible. I mean, look at other countries across the globe. You're seeing a lot of western societies, Hungary, parts of Britain, Italy, Brazil, where people are wanting to focus on their internal issues and not necessarily international ones.

But I do agree with Meghan. You got to figure out a way, Erica, to tackle the plight of everyday working class people. And if you can do that, then you can effectively say, we must maintain our standard in the world. The American people do understand that, too.

HILL: You both laid out a little bit of a to-do lists for your respective parties. We'll see if they are listening. Good to see you both. Thank you.

SINGLETON: Good to see you.

HAYS: Thank you.

HILL: Still to come here, a CNN exclusive, as we take you inside a prison camp, housing ISIS suspects in Syria, Clarissa Ward's remarkable reporting and the question she's trying to get answered. That's next.

(COMMERCIAL BREAK)

[15:37:09]

HILL: A ticking time bomb about to explode. Those ominous words used to describe a camp housing the wives and children of ISIS fighters. It's been five years now since the defeat of the terror group where the 50,000 ISIS suspects and their family members that were still being held in prisons and camps across Syria. The majority of them are children, stateless, and now coming of age.

CNN's Clarissa Ward gained extraordinary access to some of these facilities, including the notorious Panorama prison. This is her exclusive report, and I do want to warn you, there is some disturbing imagery.

(BEGIN VIDEOTAPE) CLARISSA WARD, CNN CHIEF INTERNATIONAL CORRESPONDENT (voice-over): Cell phone videos of ISIS' brutal justice that the world hoped it would never see again.

Shared for the first time with CNN, these images weren't captured in Raqqa or Mosul in 2016. They were taken in 2022 in the Al-Hol camp in northern

Syria, a sprawling dumping ground for the women and children captured after ISIS was defeated.

Five years after the fall of the caliphate, ISIS' ideology lives on here. Security officials warn it is a ticking time bomb, ungovernable and hostile to the outside world.

You can see just how vast this place is. More than 40,000 people are living here.

And the most dangerous part of the camp is called the annex. That's where some 6,000 foreign nationals are currently within.

We were granted exceptionally rare access to the annex by the U.S. backed Syrian Democratic Forces, SDF, who control the camp. The women here hail from more than 60 different countries. Several raise their right index fingers for the cameras, a sign of solidarity with the Islamic State.

WARD: Do you regret your decision to join ISIS or?

UNIDENTIFIED FEMALE (from captions): No, why should I regret this?

WARD: She complains that the conditions in the camp are awful.

There are people in the world who will say you went to join ISIS, you deserve it. You deserve it.

What do you say to that?

UNIDENTIFIED FEMALE (from captions): Normally, even with enemies.

WARD: Yes.

UNIDENTIFIED FEMALE (from captions): Women and children need services.

WARD: The majority of Al-Hol's residents are kids who have ended up here through no fault of their own. The U.N. has called it a blight on the conscience of humanity.

It is effectively a prison camp where women and children are arbitrarily and indefinitely detained.

[15:40:03]

A group stops us with a frantic plea. One of their sons has been arrested trying to escape the camp. WARD: She's asking if she can get her son back, who's in a prison.

(SPEAKING FOREIGN LANGUAGE)

(CROSSTALK)

WARD: "We wanted to send him out, so the SDF wouldn't take him," she tells us.

"Once boys turn 12th here, they take them."

It is a troubling story we hear over and over again.

The SDF says it is their policy to separate adolescent boys because they are being radicalized by their mothers.

An SDF raid earlier this year netted this video of a training session for children inside the camp.

The SDF claims young teenage boys are married off to repopulate the next generation of ISIS fighters, which, they say, may explain the roughly 60 births recorded here every month.

This is where some of those boys end up after they are taken, the Orkesh rehabilitation center. Conditions here are much better than the camps but there are only 150 beds and they are all full.

Shamil Chakar (ph) grew up in Cologne, Germany, until his parents took the family to the ISIS capital, Raqqa. A shrapnel injury to his head has left Shamil confused.

WARD: How old are you?

(SPEAKING FOREIGN LANGUAGE)

WARD: You don't know.

Shamil was living in Al-Hol camp with his mother and siblings until a few years ago, when security forces came into their tent in the middle of the night.

"A man came and pulled me up and tied my hand behind my back. My mom was screaming. She said, 'Leave him alone,'" he tells us.

"I didn't want to go with them. He pushed me, saying, 'Put on your shoes." But I didn't. Then he hit me."

Islam is from Dagestan, Russia, and is one of the youngest boys here.

(SPEAKING FOREIGN LANGUAGE)

So he's saying that he is just 12 years old. He has been here about three or four months. He was taken from his mother. He doesn't even know what his last name is.

Human rights organizations have said the separations are an appalling violation of international law.

But the SDF's top general, Mazloum Abdi, defends the policy.

GEN. MAZLOUM ABDI, COMMANDER, SYRIAN DEMOCRATIC FORCES (through translator) Instead of these organizations condemning what we're doing and calling it human rights violation, these organizations should give us help when it comes to our program that we have in place for years now, to rehabilitate these children.

WARD: But part of the problem seems to be that, once these young boys turn 18, there's not anywhere for them to go, particularly if they can't return to their home countries. And so some of them, I believe, are ending up in prison.

ABDI (through translator): This is not a policy that we are following, to put them in prison at 18. The reality is, the goal is to reintegrate them with society.

WARD: But CNN has found that boys as young as 14 had been held here at the notorious Panorama prison. With an estimated 4,000 inmates, it is the largest concentration of ISIS fighters in the world.

No journalist has been allowed inside Panorama since 2021 until now.

So the head of the prison has asked me to put on a head scarf while we walk through here because these are some of the most radicalized prisoners they have.

WARD (voice-over): A senior U.S. official told us the number one concern at Panorama is a prison break, a fear that was realized in 2022, when hundreds of inmates managed to escape.

Can I look inside?

Twenty-five men sit cross-legged in silence. The cell is spotless.

The men we see appear to be in decent physical condition.

But tuberculosis is rampant in the prison. And we are only allowed to look inside two cells.

Are you British? You are? Where are you from?

A British man approaches the grate but does not want to show his face.

UNIDENTIFIED MALE (from captions): We've been here for like five or six years. We don't know what's going on.

WARD: I know.

Advocacy groups called the U.S. funded Panorama a legal black hole, worse than Guantanamo Bay.

In an interrogation room, we meet 19-year-old Stephan Uterloo (ph) from Suriname.

[15:45:02]

He tells us he was brought to the prison when he was 14, along with more than 100 other minors.

Have you had a lawyer ever? You talk to a lawyer?

STEPHAN UTERLOO, SURINAME RESIDENT: No.

I don't know about the big guys. But if you are speaking about kids, us in (ph) -- if you want to know the truth, we don't know even why we're always like punished. Is like five years in this prison and we're punished. We don't even know what we've done. Like we've been in prison because of our times (ph).

WARD: At the SDF intelligence headquarters, we met British Pakistani Dr. Mohammed Saqib. Accused of joining ISIS, he claims he was the victim of an elaborate kidnapping plot. He says Panorama's inmates are abused.

DR. MOHAMMED SAQIB, PRISONER: So we live in torture. I live in fear.

WARD: When you say you live in torture, do you mean that you are actually physically being tortured?

SAQIB: This happens on and off.

WARD: What kind of torture?

SAQIB: Like beating by the stick, by the guards.

To be honest, I'm just waiting for my death. There's no getting out of this prison, probably never.

WARD: The warden at Panorama called Saqib's claim of abuse false, saying, quote, "All parts of the prison are monitored by cameras and no prison guard can act in this way."

The SDF and the U.S. are pushing countries to repatriate their citizens from Syria, saying it is the only solution to this complex and dangerous situation.

But the process has been slow. And many, including Western allies, are dragging their feet.

In the Al-Roj camp, we meet Brits, Canadians, Belgians, Australians and a couple of Americans.

HODA MUTHANA, DETAINEE: We survive basically.

WARD: Thirty-year-old Hoda Muthana has been stuck here with her 7- year-old son for more than five years.

I have to ask you, I'm seeing all of the women here are fully covered. A lot of them covering their faces. You're not covered, you're wearing a T-shirt.

Is that hard?

MUTHANA: It was hard when I first took it. I would say for the first 2, 3 years. People were not accepting of it, you know, and they harassed us a lot. They stole our stuff. And I had to stay strong and show an example for my son, you know?

WARD: Born and raised in the U.S., Hoda became radicalized online at the age of 20 and left her family in Alabama to live under ISIS, a decision she quickly regretted.

WARD: If you were to be able to go back to the U.S. and you had to go on trial, potentially serve time in prison, have you reconciled yourself with that possibility?

MUTHANA: I always tell myself that going to prison would be a step forward in my life. If I had any time to serve, I'd serve it and I'd come out and begin my life with my son.

WARD: For now, that is not an option. While the U.S. advocates repatriation, it ruled Hoda's U.S. citizenship invalid on a technicality.

Now she lives in fear for her son's future.

What do you miss most about America?

MUTHANA: I just want to breathe American air and be around people. I love the people of America. They're very open and they're very forgiving and they're very -- they're people who give second chances. And I think if they were to sit down with me and listen to my story from the beginning, they would give me a second chance.

WARD: But second chances are hard to come by here. For most, repentance is demanded and forgiveness rarely given as the cost of ignoring this ugly crisis continues to mount.

Clarissa Ward, CNN, Northern Syria.

(END VIDEOTAPE)

HILL: In a statement to CNN, the U.S. State Department said the department has not changed its position with regard to Muthana's citizenship status. That, of course, is Hoda, who is Clarissa was just speaking with.

Going on to say, as the State Department determined, and the courts agreed, she is not and never was a U.S. citizen.

When we return, the children who survived the Sandy Hook elementary school massacre are graduating from high school today. And understandably, they're remembering their 20 fellow students, but will not be doing that.

(COMMERCIAL BREAK)

[15:52:13] HILL: Before we leave you today, a story of survival. The first- graders who lived through the Sandy Hook elementary school massacre in December of 2012 are graduating from high school today and they're remembering their 20 fellow students who were killed on that day. Who will not be able to walk with them in graduation and receive their diplomas.

It's important to note six teachers and administrators were also killed in that horrific mass shooting. As a surviving students graduate, gun violence remains the leading cause of death for children in the United States and shooting inside schools continues to claim the lives of students and teachers.

CNN's Brynn Grass is live in Newtown, Connecticut.

I know you spoke with some of these surviving students, Brynn. How are they feeling on this day? So many mixed emotions, I would imagine.

BRYNN GINGRAS, CNN NATIONAL CORRESPONDENT: Yeah, balancing of emotions is how one of the students described it to me. Bittersweet is another way they described it, Erica. Listen, they are so excited to be high school graduates. They are so excited to go to their respective colleges in the fall, and they are ready to celebrate what they know, what they are going to be facing when it comes to those emotions as they cross that stage and get their diploma, they are missing their friends.

You know, in some cases, they still have stuffed animals that they have had for the last 12 years to remember their friends. They have the memories of what happens on that horrific day.

So, there's a lot of emotions as they go into this next chapter of their lives. But I want you to hear it from them, how they are describing this important day.

(BEGIN VIDEO CLIP)

LILLY WASILNAK, GRADUATE AND SHOOTING SURVIVOR: I think it was really important for a lot of us to take meaning out of us getting out that day. So, for me, everything I do in life is for them.

ELLA SEAVER, GRADUATE AND SHOOTING SURVIVOR: You have these big moments in your life things that are supposed to be solely exciting, but they get clouded by this and a way that we want to be remembering our friends and we are going to keep them with us, but it's also something that we wish. We never had to deal with.

MATT HOLDEN, GRADUATE AND SHOOTING SURVIVOR: Ultimately, what should be the biggest de of most of our lives. And so, it's still going to be like that. But you know, it's still -- it's still hurt knowing that they should have been here.

(END VIDEO CLIP)

GINGRAS: And look, this graduation, Erica, is going to kick off in about an hour and we're told that the students is there going to be wearing ribbons to remember those who were killed? There are going to be reading the names of all 20 of those students as well as those six educators, and there's going to be a moment of silence.

This graduation is completely private, no press is allowed inside. It is going to be a moment for them and it's so important to note, Erica, these students at those three, especially see that I talked to, you know, they're moving forward, getting ready for college, but they are activists. I mean, they just met with the VP last week to talk about gun violence.

They told me they have aspirations to be lawyers, to be a therapist, to be politicians, to make change.

[15:55:06]

They know what they went through. They carry that and they hoped that moving forward, they can make a change.

HILL: It's such an important note, Brynn, because as we have seen in the wake of these shootings, we certainly saw it after Parkland, right where the victims were older and able to speak their minds. The survivors are really the ones that have refused to be quieted and the parents of so many of the Sandy Hook children and the surviving family members of the adults who were killed as well, they have not stopped pushing here and they are really the ones I'm keeping this fight alive.

GINGRAS: Yeah, it's such a good point, Erica.

And, you know, it's funny. I said it to that Matt Holden. He's going to George Washington and he wants to be a politician. I was like, Matt, I can feel the fire in your belly. I mean, he really does believe that he is going to be a voice, a catalyst for change. And of course, there's a lot of people on his side.

HILL: Yeah, they certainly are.

Brynn, really appreciate it. It's great to have you there today and so important to mark this moment. Thank you.

Thanks to all of you for joining me this hour. I'm Erica Hill. Stay tuned.

"QUEST MEANS BUSINESS" is up next.