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Trump Concedes Tariffs May Cause U.S. 'Some Pain'; Mexico to Unveil Details of Retaliatory Tariffs Monday; Beyonce's 'Cowboy Carter' Wins Big at the Grammys; USAID Officials Put on Leave after Refusing Musk's Office Access to Classified Information. Aired 12- 12:45a ET
Aired February 03, 2025 - 00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BEN HUNTE, CNN INTERNATIONAL ANCHOR: Hello. Wherever you are in the world, you are now in the CNN NEWSROOM with me, Ben Hunte in Atlanta. And it is so good to have you here.
[00:00:34]
Coming up on the show, Donald Trump's tariff decision is already hitting global markets. We'll have the reactions and breakdown where things go next.
And Elon Musk leads the way to take on another key aid agency. Now, dozens of people are on leave for not giving up classified details.
Plus, Beyonce makes music history. We'll have the highlights and the best moments from this year's Grammy Awards.
We have just one day to go until U.S. President Donald Trump's tariffs roll into effect. He's now preparing to deal with the consequences of his decision.
Canada, Mexico, and China are all fighting back with countermeasures of their own. President Trump says he'll speak with Canadian Prime Minister Justin Trudeau, as well as officials from Mexico, in the coming hours, but he doesn't expect anything dramatic to come out of those conversations.
The president spoke for the first time on camera about his tariffs.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Canada's been very abusive of the United States for many years. They don't allow our banks. Did you know that? Canada does not allow banks to go in. If you think about it, that's pretty amazing. If we have a U.S. bank, they don't allow them to go in.
Canada has been very tough on oil, on energy. They don't allow our farm products in, essentially. They don't allow a lot of things in, and we allow everything to come in. It's been a one-way street.
We subsidize Canada by the tune of about $200 billion a year. And for what? What do we get out of it? We don't get anything out of it.
I love the people of Canada. I disagree with the leadership of Canada. And something's going to happen there.
But if they want to play the game, I don't mind. We can play the game all they want.
Mexico, we've had very good talks with them, and this is retaliatory. This is retaliatory to a certain extent. Millions of people flowed into our country through Mexico and Canada, and we're not going to allow that.
And by the way, we have among the lowest numbers we've ever had of people crossing our border, the lowest number since my administration.
(END VIDEO CLIP)
HUNTE: Well, Canada has already implemented its own counter-tariffs. Mexico says it will be unveiling its plan later today, and China says it will reveal corresponding countermeasures, but didn't elaborate.
The world is bracing for all of this to impact global markets and trade. Already, markets in Asia have tumbled, and U.S. futures are sharply lower, in a sign that investors are worried a tariff war could spur inflation and be a drag on growth.
Many economists have warned American households will likely bear the brunt of these tariffs.
CNN's Alayna Treene has more on that.
(BEGIN VIDEOTAPE)
ALAYNA TREENE, CNN WHITE HOUSE CORRESPONDENT: Well, just one day after signing steep tariffs on Mexico, Canada, and China, President Donald Trump acknowledged what many economists, people on Capitol Hill, and even some of his own advisors in their previous lives, I should note, have been warning all along, which is that Americans may feel the impact of these tariffs on their wallets.
This is what Donald Trump posted on Truth Social earlier Sunday morning.
TREENE (voice-over): He said, quote, "THIS WILL BE THE GOLDEN AGE OF AMERICA! WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT.) BUT WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID."
Now, really, that last line there, I think, is the most notable.
TREENE: He says it will be worth the price that is paid.
This is really a warning to a lot of Americans. One is that the president --
TREENE (voice-over): -- is very serious about wanting to stop the stem of -- of migrants, undocumented migrants, I should say -- and drugs, specifically fentanyl, from coming into the United States.
But he also -- his warning that, you know, doing so may be uncomfortable or even worse --
TREENE: -- for many Americans who are already contending with the high cost of living.
Now, one thing that's still unclear is when some of these higher prices or the impacts of these tariffs might start to be felt. We know that they are slated to go into effect on Tuesday, beginning at 12:01 a.m.
And another thing that's still unanswered right now is if there is an off-ramp. We know that some of these other countries -- Canada, Mexico, China -- all of them have tried to see if there is any sort of resolution that they have -- could have reached, or kind of convinced the Trump administration in order to back away from these tariffs.
[00:05:08]
But we heard the president himself say on Friday that there weren't any concessions that he believed they could make at this point.
And on a briefing call with reporters on Saturday evening --
TREENE (voice-over): -- White House officials also declined to lay out specific benchmarks that Canada or Mexico could reach in tightening their borders or curbing fentanyl flows that would allow the tariffs to be lifted.
We also know that --
TREENE: -- in the fine print of these tariffs that Donald Trump signed on Saturday, it does have a retaliation clause. That means that he could perhaps raise these tariffs even further if he believes that these countries are responding in a way that he doesn't necessarily agree with.
Alayna Treene, CNN, West Palm Beach, Florida.
(END VIDEOTAPE)
HUNTE: Canada is using this moment as a teaching lesson, hitting the U.S. Where it hurts as a key supplier of oil, cement, and wood to the U.S. America's gas prices and the housing market could see a major impact in the weeks ahead.
On Sunday, Canada unveiled a full list of things imported from the U.S. into Canada, which would be tariffed. And as you can see on your screen right now, the list is very long.
The overall response from Canadians has been hopeful but resolute.
(BEGIN VIDEO CLIP)
CHRYSTIE FREELAND, FORMER CANADIAN DEPUTY PRIME MINISTER: We have more leverage than Americans think. Canada is the largest market for the United States, larger than China, Japan, the U.K., and France combined.
And we know Americans. We know that for you guys, the customer is always right. We're your biggest customer. Doesn't make a lot of sense to be punching us in the face.
America's tariffs are self-harming. You know, by putting tariffs on the stuff that Canada sells you, you are going to hurt Americans. You have put a tariff -- You're putting a tariff on the oil and gas that we sell you. That is going to make prices at the pump, prices at grocery stores a lot higher.
(END VIDEO CLIP)
HUNTE: In the coming hours, Mexico is expected to reveal the details of its own retaliatory tariffs on goods from the U.S.
CNN's Valeria Leon has more.
(BEGIN VIDEOTAPE)
VALERIA LEON, CNN INTERNATIONAL CORRESPONDENT: The winds of a trade war have filled the air after Trump slapped a 25 percent tariff on all Mexican imports.
LEON (voice-over): And Mexico responded, hit back at Trump's tariffs with tariffs of its own on U.S. imports.
Mexico's president, Claudia Sheinbaum said she had ordered her economic minister to kick off a response plan called Plan B, that includes implementing tariff and non-tariff measures to defend Mexico's interests, signaling what looks to many like the beginning of a trade war between the two countries. But others see it as a mere tool of negotiation.
Nevertheless, Sheinbaum said her government sought dialog rather than confrontation with its Northern neighbor.
But tensions between the closely connected neighbors soared after the White House accused Sheinbaum's government of having alliances with drug cartels.
Sheinbaum angrily rejected the accusation by the Trump administration and vowed to retaliate against his sweeping tariff.
LEON: The Mexican government hasn't explained what exactly Plan B is. With tariffs taking effect on Tuesday, it's unclear if, in the coming days, there will be a last-ditch effort to negotiate a deal with the United States's biggest trade partner.
Valeria Leon, CNN, Mexico City.
(END VIDEOTAPE)
HUNTE: Well, there is a lot to get into, so let's break it all down with Washington State University economics professor Christopher Clarke.
Christopher, thank you so much for being with me. How are you doing?
CHRISTOPHER CLARKE, ECONOMICS PROFESSOR, WASHINGTON STATE UNIVERSITY: I'm doing very well. Thanks for having me tonight.
HUNTE: You're so welcome.
Firstly, I just want to talk about the international effects of these tariffs. Assuming that Americas allies are actually still its allies, how is all of this affecting those very relationships?
HUNTE: Oh, well, this is a huge break from decades and decades and generations of strong work. It took years of negotiations to create NAFTA in 1994, the free trade agreement between Canada, U.S. and Mexico. It was revamped under the Trump administration's first round. And then it's just thrown all out in one weekend here.
HUNTE: My goodness. And do you think that this is actually temporary, or are these tariffs here to stay now?
CLARKE: Well, I think, as we've already heard, there's not an exit ramp given by the Trump administration.
Multiple justifications have been given. He said it's about fentanyl, but they're not apprehending much fentanyl coming from Canada.
He says it's about the trade deficit. But the trade deficit with Canada is really small.
He says it's about immigration. But again, where's the immigration from Canada?
So, you can point these things to China, Mexico, and Canada in some respect, but there is no clear exit ramp. So, here to stay for now.
HUNTE: And have you been surprised by how fast all of this seems to be happening? It feels like the world wasn't really prepared --
[00:10:05]
CLARKE: Yes.
HUNTE: -- for Trump 2.0.
CLARKE: No, definitely not. There were so many different campaign promises, many contradictory. Many didn't know what was going to happen.
And when he announced 25-percent tariffs on Canada and Mexico, we all thought, I thought this was going to be about China, geopolitical issues going forward, or manufacturing.
But Canada and Mexico have had a well-integrated economy with us, have been close friends and allies for generations. It has been quite a shock to see these things finally come into fruition. HUNTE: I actually asked my guest on yesterday's show whether she
thought that voters were lied to, because I thought that people wanted Trump in order to stop inflation, bring down the price of eggs. What do you think? Were people lied to?
CLARKE: Well, I always hesitate to attribute motive to anybody.
HUNTE: OK.
CLARKE: But if they were promised that eggs would be lower, if they promised inflation would be lower, tariffs are not how you do that. Tariffs do the opposite.
I mean, we're expecting the inflation to go up by half a percentage point. We're expecting American families to be paying $1,000 more a year in higher prices from goods we import from our neighbors.
HUNTE: And we're already seeing the reaction on global markets. How much will it really impact the world? Break that down for me.
CLARKE: So, the estimates that we have, when we plug these things into kind of standard macroeconomic models, is that the United States economy is expected to grow about a half a point less.
HUNTE: Oh.
CLARKE: For reference, the U.S. economy is growing two and a half to 3 percent. So, it's not going to cause a recession. But it does lower our potential. And that means less, more -- less jobs will be created in the future and a less robust economy than otherwise.
HUNTE: Well, I just learned so much from that. And I'm sure there's more to come. So, Chris Clarke, thank you so much for now. Really, really appreciate it.
CLARKE: Thank you for having me. It was fun.
HUNTE: So welcome.
The U.S. president issued a warning to Panama just hours after Secretary of State Marco Rubio paid a visit to the Panama Canal.
Trump told reporters on Sunday the U.S. is going to retake control of the waterway or, quote, "something very powerful is going to happen."
Rubio and the Panamanian president discussed the White House's concerns over China's presence around the canal. Panama's president repeated that sovereignty over the waterway is not up for debate.
But he also said Panama will not renew a 2017 memorandum of understanding to join China's overseas development initiative, known as the Belt and Road Initiative.
At least one person has died and thousands more are forced to evacuate in Northeastern Australia due to dangerous flash flooding. It's affected large parts of North Queensland since Friday and was
caused by intense rainfall. Residents of low-lying coastal suburbs and towns were urged to head to safer ground immediately and have been warned to watch out for crocodiles in the floodwaters.
Coming up, Democrats fear the Trump administration is trying to dismantle USAID, an independent federal agency and the biggest provider of humanitarian food aid in the world.
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HUNTE: Sunday night's Grammy Awards in L.A. was laced with all of its fabled glitz and glamor, but the big winner of the night was none other than Beyonce.
For the first time, she won Album of the Year, and as Taylor Swift announced, Beyonce won Country Album of the Year, too.
(BEGIN VIDEO CLIP)
TAYLOR SWIFT, SINGER: And the Grammy goes to -- "Cowboy Carter," Beyonce.
(END VIDEO CLIP)
HUNTE: Beyonce is the first black woman to win Best Country Album. Accepting the award, she had a message for all artists.
(BEGIN VIDEO CLIP)
BEYONCE, SINGER: Wow. I really was not expecting this. Wow. I want to thank God -- oh my God -- that I'm able to still do what I love after so many years.
I think sometimes genre is a code word to keep us in our place as artists, and I just want to encourage people to do what they're passionate about.
(END VIDEO CLIP)
HUNTE: The Los Angeles wildfires also played a role in the show. The Grammys honored emergency workers and highlighted fundraisers for wildfire relief.
Well, you know I want to dig into this. So, Michael Musto is an entertainment journalist with "The Village Voice." He joins me live from New York.
Michael, what a night. How are you doing?
MICHAEL MUSTO, ENTERTAINMENT JOURNALIST, "THE VILLAGE VOICE": A wonderful night. And, you know, Beyonce was and still is the most Grammy-winning artist in history. She had 32 Grammys. Then she had two more today. One of them was Best Country Album. So, 34 Grammys going into Album of the Year. This is her fifth shot at
Album of the Year.
There were times in the past when the people who won said Beyonce should have won. Remember, Adele won, and she said, Queen Bee, Queen Bee should be up here. The winners were saying Beyonce should have gotten the award.
So, it was a very gratifying feeling to see her finally win. I was surprised at how calm she was. I thought she'd be hysterical.
HUNTE: I mean, I'm glad you just snatched the mic and ran away with Beyonce there, because yes, I wanted to talk Beyonce.
[00:20:03]
She is the most Grammy-winning artist in history, but I want to talk about the fact that she had never won that Album of the Year.
What does this moment mean to the industry and especially to those industry bosses who ignored her for so many years?
MUSTO: It means a lot, because she has done so much for the industry. She has sold so many records and created so many different genres, as she said.
This is a country album that was extremely controversial. Remember, she didn't get a single nomination with the Country Music Awards. They found her to be too white [SIC] to -- too bright, I'm sure. What am I saying? You know what I'm saying?
In this case, she's saying that country music belongs to everybody.
I remember in the 1960s -- that's how old I am -- I bought an album by Diana Ross and the Supremes. And Diana was great on the Grammys tonight. And they sang country music, and it was not a problem.
Beyonce, how many years later, comes out with it, and suddenly, oh, we own country music. She's saying nobody owns any genre of music.
And it's also a terrific album. That's the important thing. She didn't just win as a symbol; she won as a true artist.
HUNTE: Yes, indeed. I mean, me and my producer were celebrating upstairs on the arrival of the tour dates. I can't wait for this. What's going to be happening with the tour?
But more than that, "brat summer" may be over. But this has been a huge year for new or newer artists. I mean, we're seeing on social media some people reacting that they didn't even know some of the people that were winning awards tonight. So, can you tell me a bit more about these newer artists?
MUSTO: Yes, well, the Best New Artist category has become more of a "best breakthrough artist," because some of the artists have been around. They're not really that new. Sabrina Carpenter has been around for several years, but she's
terrific. She even tap-danced tonight. She's sort of an old-school entertainer, in my opinion.
But I've had a feeling Chappell Roan was going to win Best New Artist. And she did.
She's the newest in the line of, like, Madonna, Lady Gaga, who was also amazing tonight and now Chappell Roan. Sort of an avant-garde, expressive, humorous, artistic performer. Richly deserved. And her messages are all terrific.
And there were so many messages tonight of social consciousness, from Alicia Keys talking about diversity; Lady Gaga promoting trans people; Chappell Roan talking about health insurance and the importance of it for artists and for everybody.
So, I found the whole thing to be very refreshing, and the whole emphasis was always on raising money. It was a telethon. And celebrating L.A. and California.
But it wasn't really that mournful when you consider that look at how they dressed. The people dressed tonight for a party. And so, they really helped lift our spirits by treating it like a party.
HUNTE: Yes, I mean, on that, there were questions about whether the event would even take place this year because of the fires that were occurring literally around the corner. How did the ceremony reference the tragedies occurring?
MUSTO: They had various speakers address the problems. They made it into a telethon where they were raising funds all through the -- the telecast.
And I think it's a good message to the Academy Awards, which are coming up on March 2nd. You don't have to cancel. You could do it in a slightly different tone. And you can make it a positive event where you're raising money to help the problem.
But basically, celebrating artists and what they do is something that lifts us out of tragedy and bonds us as -- as people.
So, please -- I live for awards. You know, I don't want to go on without Grammys and Oscars and all that stuff. It's -- to me, it's the gay Olympics. So, bring them on.
HUNTE: More awards, more awards. I love it. Michael, thank you so much for that. I'm glad you're having a really good evening. Keep it going. Thank you so much.
MUSTO: Thanks for having me.
HUNTE: Still to come, a U.S. agency that provides humanitarian aid and development aid to countries around the world is under threat by the White House and by a billionaire who says, quote, "time for it to die." That's next. (COMMERCIAL BREAK)
[00:28:15]
HUNTE: In a move that could impact thousands of FBI staffers, the Trump administration is demanding the names of all bureau employees who helped investigate the Capitol insurrection.
The Justice Department says it wants to determine whether any additional personnel actions are necessary.
Donald Trump has vowed to strike back at agencies he feels were weaponized against him.
Republican Senator Lindsey Graham says the president has the right to push out senior leaders who don't share his vision, but also this.
(BEGIN VIDEO CLIP) SEN. LINDSEY GRAHAM (R-SC): Now, if you're an agent working on January 6th case or some other case, and you were assigned to do it, and -- you know, you shouldn't be punished just for doing your job.
(END VIDEO CLIP)
HUNTE: FBI employees say the January 6th case was the largest investigation ever worked by the bureau, with nearly everyone involved in some aspect of the case.
The U.S. CDC is starting to remove several websites and data sets as it works to comply with President Trump's new orders. He wants to eliminate federal diversity and equity programs and require the government to recognize only two genders.
Among the sites that went dark on Friday are those focusing on HIV, LGBTQ issues; and health data on youth sexual behaviors, violence, obesity and suicide.
Officials say the removal of certain language on these sites will still take time, and it's unclear when they'll be back online.
And the website for USAID, the U.S. Agency for International Development, has also disappeared from the Internet. USAID has been caught in a Trump administration's crosshairs as the White House works to freeze the United States's foreign aid around the world.
Democratic lawmakers fear that the Trump administration is trying to integrate the independent, congressionally-funded humanitarian agency into the State Department. They say it's illegal for the president to eliminate a federal agency without consulting Congress.
[00:30:14]
Two of USAID's top security officials have just been placed on administrative leave by the Trump White House.
CNN's Alex Marquardt has the story. (BEGIN VIDEOTAPE)
ALEX MARQUARDT, CNN CORRESPONDENT (voice-over): Saturday, personnel from DOGE, the Department of Government Efficiency, which was created by Elon Musk, essentially tried to barge into the headquarters of the U.S. government's aid agency, USAID.
At first, they weren't allowed in, and they threatened to call the U.S. Marshals Service to force USAID to let them in.
Now, sources tell CNN that the team from DOGE wanted access to security systems, personnel files --
MARQUARDT: -- and areas where classified information is held. A reminder that you need a security clearance to access areas and information like that.
Now, eventually, the DOGE team did gain access, and CNN learned on Sunday that the two most senior security officials, the director of security, John Voorhees, and his deputy, were put on leave.
This comes after dozens of other top career officials --
MARQUARDT (voice-over): -- were sent home on leave by the Trump administration, amid fears that -- that USAID is being gutted.
Now, not long after CNN's reporting came out, Elon Musk posted on X --
MARQUARDT: -- the platform that he owns --
MARQUARDT (voice-over): -- "USAID is a criminal organization. Time for it to die."
The USAID website went down on Saturday. Its X account was taken offline on Sunday. There's a new page now on the State Department website for USAID, which means it could soon be absorbed by the State Department.
Now, current and former USAID officials have argued to me that USAID must remain independent, that the State Department does not have the expertise, the training, the capacity to handle the kind of work that USAID does.
It is the biggest provider of food aid in the world. It has a budget of over $40 billion and works in more than 100 countries in some of the most desperate, difficult and hard-to-reach places.
MARQUARDT: Now, this is, without question, a seminal moment for the U.S.'s role in the world. How it helps people well beyond its borders, how it is perceived in the world.
And there are warnings of a significant impact on U.S. national security interests.
Alex Marquardt, CNN, Washington.
(END VIDEOTAPE)
HUNTE: More than 200 earthquakes have rattled one of Greece's most popular island getaways. Still ahead, we'll look at the warnings being issued on Santorini for both tourists and residents alike.
(COMMERCIAL BREAK)
[00:37:08]
HUNTE: Fears of further attacks and sexual violence are growing in the Democratic Republic of Congo, where M-23 rebels are continuing their advance in the country's East.
They seized the key city of Goma on the border with Rwanda early last week and have since moved farther South, making it dangerous for civilians trying to escape the fighting between the rebel group and government forces.
Thousands of people have been displaced in the war-torn region. Civilians say this latest violence they've encountered isn't just on the battlefield. Some are recounting horrific stories of women being raped and people being attacked as they flee.
(BEGIN VIDEOTAPE)
FLORIDE FURAHA, DISPLACED PERSON (through translator): I fled the rebel bombardments, because they had killed many people. I lived for one year in a town as a displaced person, but there too, the recent war made me flee to another place and we had to flee again After being attacked by looters who took everything from us, until we arrived here at this school. We sleep on the ground with nothing. As you see us here, we have nothing, neither food nor anything to sleep on.
(END VIDEO CLIP)
HUNTE: UNHCR says more than 400,000 people have been displaced in the region this year alone, and paints a grim picture of life in the conflict zone, with reports of human rights violations, including murders, kidnappings, and arbitrary arrests.
Hospitals are also nearing capacity, with injured civilians and vulnerable people like children and the elderly, are forced to live in crowded conditions with limited access to food and water.
Despite the ceasefire in Gaza, an Israeli airstrike on a car there on Sunday wounded at least four Palestinians, including a young child.
The Israeli military says the strike did not violate the ceasefire, because the car was a suspicious vehicle driving toward North Gaza.
They also say it was not on the road permitted by the ceasefire agreement.
Since the ceasefire began, Israeli forces have killed several Palestinians in Gaza. Israel says these incidents have not violated the agreement. Hamas says they have. More than 100,000 people gathered in Berlin on Sunday to demonstrate
against Germany's far-right AFD Party. Many are angry that the country's center-right Christian Democratic Party is asking the far- right group for support to crack down on asylum policies.
Mainstream parties in Germany have refused to cooperate with the far- right since the end of World War II.
One of Greece's top tourist spots is issuing warnings after experiencing more than 200 small earthquakes. Officials are telling people to avoid large indoor gatherings on the volcanic island of Santorini.
Millions of tourists visit the island each year, and so far, there's been no damage. But officials are telling people to stay away from ports, including one that's popular with cruise ships.
Santorini is also closing schools on Monday, and the island hasn't been hit by a large earthquake since 1956.
[00:40:07]
All right. Well, that's it. I'm Ben Hunte in Atlanta. Thank you for joining me and the team. It's been real. Let's do it all again in about 15 minutes.
WORLD SPORT is up next. See you in a bit.
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(WORLD SPORT)