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New U.S. Tariffs to Take Effect Next Week, U.S.-China Deal Ongoing; President Trump Fires Commissioner of Labor Statistics; Texas House Democratic Flee State on to Block GOP Plan; Worsening Hunger Crisis in Gaza, Netanyahu Seeks Red Cross Help on Hostages; Trump: Special Envoy May Visit Russia Wednesday Or Thursday; Malibu Residents Seek Safer Option Than Pacific Coast Highway; Texas Dems Flee State To Prevent GOP Redistricting Plan; Small Businesses Claim They're Owed Millions By Tesla. Aired 2-3a ET

Aired August 04, 2025 - 02:00   ET

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

[02:00:00]

(COMMERCIAL BREAK)

ROSEMARY CHURCH, CNN HOST: Welcome to our viewers joining us here in the United States, around the world and streaming us on CNN Max. I'm Rosemary Church. Just ahead, new U.S. tariffs are set to go into effect this week. We will take a look at how markets are responding and the potential political fallout.

Outrage in Israel over the fate of hostages held in Gaza. Benjamin Netanyahu is now asking the Red Cross to help.

And the new idea aiming to make Malibu's iconic coastal highway safer.

Good to have you with us. Well, new U.S. tariffs on just about every country in the world are set to take effect this week. The impact will be widespread with President Donald Trump imposing the highest tariff since the 1930s. The Trump administration is warning that the rates are final and will not change again. The White House says a 10 percent tariff will apply to most countries. Others will face at least a 15 percent rate if the U.S. has a trade deficit with them.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: We're seeing phenomenal numbers in terms of the business we do with other countries and the business we do within our own country. I mean, really phenomenal numbers.

KRISTEN WELKER, NBC HOST: Could a market reaction prompt President Trump to change these tariff rates again?

KEVIN HASSETT, U.S. NATIONAL ECONOMIC COUNCIL DIRECTOR: The markets have seen what we're doing and celebrated them. I don't see how that would happen.

WELKER: Okay, but not ruling it out? HASSETT: No, I would rule it out because these are the final deals.

(END VIDEO CLIP)

CHURCH: So let's take look at where U.S. markets stand ahead of a busy week and you see the U.S. futures there all up in positive territory. We'll see what happens in the hours ahead when markets open. CNN's Kevin Liptak is following the latest developments from the White House.

KEVIN LIPTAK, CNN SENIPR WHITE HOUSE REPORTER: The message from the White House and from President Trump is that these tariff rates that he's put into motion at the end of last week are very much here to stay even as he has allowed this grace period before these tariffs take effect, allowing potentially some time for countries to come in and try and negotiate their rates down. What we've heard from senior economic officials in the administration is that these rates are essentially here to stay.

We heard from Jamieson Greer, the U.S. Trade Representative, saying that the rates are pretty much set. Kevin Hassett, who is the top economist here at the White House, said that the rates are more or less locked in, both of them very much backing up this tariff plan, even as this threat of potentially higher prices for consumers really starts to set in. In the days before the president announced these new tariff rates, you heard from a number of companies who said that they either had already raised prices or were planning to do so as these tariffs make imports more expensive.

That includes Adidas, Procter & Gamble, Black & Decker, other companies including Walmart, Hasbro, and Mattel have all said that they could raise prices as a result of these tariffs. But certainly President Trump is very much locked into the strategy. Listen to what he said as he was returning to the White House on Sunday.

(BEGIN VIDEO CLIP)

TRUMP: I'm not looking for leverage. I'm looking for fairness. We want reciprocal as much as possible. Sometimes reciprocal would be too much for them to handle because it would be a much bigger number, but we want to see some reciprocity. We want to see reciprocal wherever we can. And all I can say is this, our country will be taking in hundreds of billions of dollars. You just said it, already we're taking in billions and billions of dollars, and it was very unfair. The world treated us very unfair.

(END VIDEO CLIP)

LIPTAK: Now one other area to watch on the trade front is China. The president's still very much in search of a trade deal with Beijing. The deadline for those tariffs to take effect was slightly different. August 12th was the date by which the President had said that those new higher tariffs would take effect. But it does now appear likely as if that will be delayed as U.S. officials continue to hammer out some of the specifics with Chinese officials on this deal. American officials have said that those discussions are going very

well, suggesting that they're making progress and that they don't think that that deadline of August 12th is necessarily operable at this point.

[02:05:04]

Of course, the other main story that has been dominating White House economic circles this weekend was the President's decision to dismiss the Commissioner of the Bureau of Labor Statistics last week after that very disappointing jobs report. The President saying completely unsubstantiated that the numbers were rigged for political purposes. You heard the president's top officials defending that move on Sunday, Kevin Hassett saying that the president wants his own people there so that when he sees the numbers that they're more transparent and reliable.

But we've also heard from a number of economists who say that these revisions that the president has been railing against are a normal process of how these jobs figures come together and they're warning that eliminating and dismissing someone because the president doesn't like the numbers could lead down a very dangerous path.

Now the president said that he planned to appoint a new head of that agency within three or four days. That person will be subject to what would be expected to be quite a contentious confirmation process in the Senate as the president's move is scrutinized and as lawmakers work to ensure that political interference doesn't seep into this critical statistical agency. Kevin Liptak, CNN, the White House.

CHURCH: More now on the negotiations between the U.S. and China. Let's go to CNN's Kristie Lu Stout.

KRISTIE LU STOUT, CNN CORRESPONDENT: The U.S.-China trade truce could be extended beyond the August 12th deadline. That's according to the U.S. Trade Representative Jamieson Greer. After reaching preliminary deals in May and June, the U.S. and China now have just over one week to get an extension or a lasting trade deal. If there is no agreement here, tariffs are going to snap back up to those ultra-high levels.

In an interview with CBS that aired on Sunday, Greer was asked whether the deadline of August the 12th would be extended. He said, quote, "that is something we're working toward." Now Greer also said that recent trade talks with China were going in quote, "a positive direction" and that they focused on rare earth magnets and minerals. Watch this.

(BEGIN VIDEO CLIP)

JAMIESON GREER, U.S. TRADE REPRESENTATIVE: We talked about, and I won't go into detail because they're, you know, confidential conversations between two governments, but they really focused on rare earth magnets and minerals. China has put a global control on the world. And so for the United States, we're focused on making sure that the flow of Magnets from China to the United States and the adjacent supply chain can flow as freely as it did before the control. And I'd say we're about halfway there.

(END VIDEO CLIP)

STOUT: Last week, U.S.-China trade talks in Stockholm ended without a deal. There are a number of contentious issues in the U.S.-China relationship including China's export controls on rare earths, China's purchase of sanctioned Russian and Iranian oil, fentanyl particularly the flow of fentanyl precursor chemicals from China, and the fate of TikTok.

Now by Friday, August the 1st, the Trump administration imposed tariffs on scores of countries, and Greer says that those tariffs will likely stay in place. But analysts say trade talks between the U.S. and China are far more complex and they can turn on a dime. Kristie Lu Stout, CNN, Hong Kong.

CHURCH: Texas Governor Greg Abbott has a warning for Democratic lawmakers who left the state, show up for work (inaudible) removed from office. House Democrats in the state legislature are pushing back against the Republican-led effort to redraw the Texas congressional map. Some have traveled to Illinois, New York and Boston, denying the House the minimum number of members needed to advance the redistricting plan.

Critics argue that plan could possibly eliminate five Democratic U.S. House seats ahead of next year's midterms. Republicans say it's necessary because the current maps are unconstitutional. But Democratic leaders nationwide say they will fight back with their own redistricting efforts in other states. Texas Democrats say the efforts of their Republican colleagues are purely political.

(BEGIN VIDEO CLIP)

GENE WU, TEXAS DEMOCRATIC STATE REPRESENTATIVE: Everybody is already tired of the hyper partisan bickering and all the fighting because we never get anything done. And they are creating a system that will reinforce that and make it even worse. And we're telling people, please come out, stand up against it, rise up and say no more, enough.

(END VIDEO CLIP)

CHURCH: Ron Brownstein is a CNN senior political analyst. Good to have you with us.

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: Thanks for having me, Rosemary.

CHURCH: So let's start with Texas Democrats leaving the state in an effort to stop Republican plans to redraw the congressional map to gain an additional five house seats at the expense of the Democrats.

[02:10:01]

So what could this mean for the midterms and democracy itself? And can we expect to see similar redistricting, do you think, in other states? BROWNSTEIN: Well, we are seeing really unprecedented pressure from

Trump on Republican controlled states to try to redraw their maps in between the decennial census, which itself was an unusual, very rare event until recently for any state to draw the lines again, but to do so, so explicitly, under a direction from a president of your own party to try to build a firewall in the midterm election.

I mean, it's just another marker of how far we are descending from what had been, you know, kind of the traditional assumptions of our democracy and how far we are advancing into a situation in which the red and blue states are not really seeing themselves as part of a federated republic, but really as just almost hostile entities that are vying for control of the national government.

I look at this as a very ominous kind of marker of where we are and where we are going because it's not only the red states. Now Trump is triggering the blue states to respond in kind.

CHURCH: And Ron the White House is calling Donald Trump's new trade tariffs the final deals but we have of course already seen deadlines extended and tariffs start and stop causing massive uncertainty for markets and nations around the world. And now stocks face a big threat ahead of President Trump's new tariffs which take effect for most countries this coming Thursday. So what might be the political consequences of this once voters do start to feel the real economic pain of these tariffs?

BROWNSTEIN: Well, you know, I look at the tariffs as really one of the best examples of something we've talked about before, which is that compared to his first term, Donald Trump believes he is governing absolutely unbounded and almost unfettered. All of the constraints that limited him in his first term have eroded, if not collapsed, and therefore he is free to pursue his agenda to the max. That isn't necessarily an unconditional benefit for him or for his party.

These tariffs are not as large as he may have originally threatened, but they are larger than Americans have faced since the Depression. You know, you look at the Yale Budget Lab, their calculations are that these are the largest tariffs Americans have faced since basically the era of Smoot-Hawley in the 1930s. And they will, in fact, mean a significant, in effect, tax increase, particularly on those families of modest means that were critical to his election.

Donald Trump was elected above all to solve one problem. If you look at the exit polls and the other data done in the election, Americans elected him to bring their cost of living under control. He can point to what he believes will be other benefits of tariffs in terms of perhaps repatriating jobs over the long run, but there is no way that these do not increase the cost of living for average Americans. And I think as Joe Biden learned, new investment and new jobs are no substitute when voters are concerned that you're raising their costs and that I think is the trap that Trump is walking into as well.

CHURCH: And Ron, meantime, new AP polling came out Sunday showing that voters in both parties are losing patience with politicians and feeling pretty pessimistic about the future. Republican voters call their party greedy, pro-rich and generally bad. But Democrats were more disillusioned calling their party weak, apathetic, ineffective and disorganized. So, what do the numbers reveal to you and what do the leaders of both parties need to be doing to garner more support for next year's midterms?

BROWNSTEIN: Well, I mean, these numbers really, Rosemary, are just one more reflection of something that is so much a part of our experience that we don't think about how unique it is. But the fact is, is that the period roughly for the last 60 years, since around 1968, is the longest period in American history when neither party has been able to establish a lasting advantage over the other. And it is precisely because of numbers like that.

Neither party really has had any period in the last half century or so where they have been able to convince a durable majority of the country that they have solutions to the day to day problems that Americans face, in particular the squeeze on living standards that we faced since the early 1970s in the era of globalization and income inequality. And, you know, as I said, Donald Trump was elected for a lot of reasons, but without doubt, the most prominent was the feeling among Americans that Biden -- most Americans that Biden mismanaged the economy.

They thought Trump would bring back an economy in which their life made more sense and was more affordable. He simply is not making enough progress on that in the eyes of most Americans.

[02:14:56]

And so you have a dynamic in which Republicans are at risk of seeing the wheel turn again against them in 2026, which brings us back around to where we started.

That's why Trump is putting so much pressure on Republican-controlled states to try to redraw their lines, in effect to rig elections, to squeeze out more seats, because I think the White House recognizes that if you look at the trajectory of public opinion now, they are not in position to hold the House. Don't forget, as we talked about before, neither party having a majority of more than 10 seats in each of the last three House of Representatives. That's never happened before in American history. It's another reflection of what we're discussing, the inability to decide to establish a durable advantage over the other.

CHURCH: Ron Brownstein, always appreciate your political analysis. Many thanks.

BROWNSTEIN: Thanks for having me.

CHURCH: Still to come, Israel's Prime Minister is looking for help from the Red Cross to deliver aid to hostages in Gaza after public anger over video showing two emaciated Israeli captives.

Plus, a worsening humanitarian crisis in Gaza, what some countries are doing to help get aid into the enclave. That is next.

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[02:19:58]

CHURCH: Israel's military says six countries, including Jordan, France, Germany and Belgium, airdropped 136 aid packages into Gaza on Sunday. That comes one day after 90 aid packages were dropped into the enclave. However, health workers say these efforts are not enough to reverse the deepening hunger crisis. And the United Nations warns airdrops are ineffective and dangerous.

The U.N. has released new video showing thousands of Palestinians seeking aid in northern Gaza, were many are voicing their frustration over the lack of food and what they call a poor and dangerous method of distributing aid.

Israeli Prime Minister Benjamin Netanyahu is asking the International Red Cross to bring food and medicine to the hostages held in Gaza. A warning, the image you're about to see is disturbing. His request follows outrage in Israel over the release of Hamas and Palestinian Islamic Jihad's propaganda videos showing two emaciated Israeli captives. The anger spilling over on the streets of Tel Aviv on Saturday night where large crowds call for a deal to free the remaining hostages.

Hamas now says it is prepared to quote, "deal positively" with any request by the Red Cross to deliver aid to Israeli hostages, but only if humanitarian corridors are opened up in Gaza. Meantime, families of those held a warning against an expansion of the war. As one Israeli official says, Netanyahu is pushing to free the hostages through military defeat of Hamas.

(BEGIN VIDEO CLIP)

BENJAMIN NETANYAHU, PRIME MINISTER OIF ISRAEL (through translation): Dear citizens of Israel, like you, I was deeply shocked yesterday. I saw the horrifying videos of our dear sons, Rom and Evyatar. I called the families, embraced them on behalf of myself and my wife, and on (inaudible) have too. You see them wasting away in a dungeon, but the Hamas monster surrounding them have thick, fleshy arms. They have everything they need to eat. They are starving them the way the Nazis starved the Jews. And when I see this, I understand exactly what Hamas wants. It doesn't want a deal. It wants to break us through these horrifying videos, through the false propaganda it spreads around the world. But we will not break. I am filled with even stronger determination to free our kidnapped sons, to eliminate Hamas, and to ensure that Gaza will no longer pose a threat to the state of Israel.

(END VIDEO CLIP)

CHURCH: Joining me now is Ruby Chen, whose son was serving with the IDF when he was taken hostage by Hamas. So I want to thank you, sir, for joining us at this very difficult time.

RUBY CHEN, FATHER OF ITAY CHEN, AMERICAN-ISRAELI HOSTAGE IN GAZA: Thank you for having me on day 668. CHURCH: Yeah, and I was going to mention that too. Your son, Itay, is

an American-Israeli hostage who was taken to Gaza by Hamas more than 600 days ago, as you point out. And while the IDF has told you that your son is dead, you have received no evidence to support that claim and Hamas has not acknowledged it. So you still hold out hope that he's still alive. Did you learn anything more about his situation from your meeting with Special Envoy Steve Witkoff, who has pledged to bring all the hostages home?

CHEN: Now, first of all, I think it is admirable that Mr. Witkoff took almost three hours of his time to sit down with the families and to listen to us and answer all the questions we have. We understand from Mr. Witkoff that the last six months that the current administration inherited a framework from the previous administration, how to get to a deal and was convinced by the Israeli prime minister (inaudible) that this is the best option going forward.

I think they've reached a conclusion that that framework is not viable and as to what they have shared, that we are doing a small pivot where the two main components going forward is the end of war and the release of all the hostages in one shot.

CHURCH: And that meeting with Steve Witkoff, as you said, lasted nearly three hours. He told you and all the other hostage families that the Trump administration's first priority is to bring all the hostages home and that they have a plan to do that. What is that plan exactly and how would you like this to play out?

CHEN: So of course Mr. Witkoff did not go into details what the specific plan is and I think that is a good strategy not to share it with families because then it would know, pop up in the media. I think that they have well thought of the different components compared to January, where they just got into office and they continued the previous framework. I think now they have a pretty good understanding of the different elements in the Middle East and what is doable and what is not doable.

[02:25:04]

And I think this is in line with the president's strategy for the Middle East, which he's shared on numerous occasions, which is end of conflict, stability in the Middle East, economic prosperity for all the people in the Middle East that the United States could tap into and benefit from as well. And it has been six months, and I think the president understands that if he wants to cement his legacy, as he sees himself as the best president in our lifetime, then I think that need to happen.

And I think that is where Mr. Witkoff is, and it was also important for Mr. Witkoff to share that he also -- one of the objectives of his visit was also understanding and assessing the so-called starvation in Gaza and that was also something that he will report back to the president, I assume. It happened yesterday and he will share that assessment to the media, I assume in the next day or two. CHURCH: Right and Steve Witkoff also said that they would hold Hamas

responsible for any bad acts on their part. What do you want to see happen to Hamas at this time?

CHEN: Again, it's not, you know, specifically for us to decide that. I think that we are all children of God. We all walk this planet together. It's not a competition on who suffers more. I see the pictures as everyone does, and I'm sure there are people that are hungry in Gaza, as well as the fact that our brothers and sisters, 50 of them are in dire condition and being starved like the Holocaust in the past that Jewish people were not given food.

But at the end of the day, you know, we need to find a better path for all of us. And I would say that I think that there isn't enough food in Gaza. I just think that there is a distribution challenge because Hamas takes the food and then sells it on the black market to get money. But let's wait for Mr. Witkoff and see what he has to say.

CHURCH: And what would you like to tell us about your son, Itay, and the man you know him to be?

CHEN: Well, first he's 19. It's hard to call him a man at that age. He's just a good kid, like any kid you would see growing up in your neighborhood. He has a loving girlfriend. He loves being a Boy Scout's counselor and helping younger kids. Loves to play basketball more than anything else. He loves to beat me in basketball. Beating your dad in basketball is one of the best things a kid could have.

And, you know, he's just very much missed and I'm sure all the viewers here could relate to the fact that each time we sit at our dinner table, and even more so if it's a holiday, we have an empty chair with us. And that's been the case for 22 months. And I think all of us need to find a way to end this as the president wishes to see. And just try to go back to our normal lives and process whatever happened to Itay and we will need to deal with.

But at the moment there are 50 hostages that have not received any type of medical attention. The International Red Cross have not been able to come and visit them and provide medical attention. And Hamas, using their lowest type of psychological warfare, have not provided any acknowledgement who they have in their possession and what their status is. And it's a shame that the international community allows that to happen by a terrorist organization.

I think the international community needs to have a more stronger voice in saying that this is unacceptable. For example, a terrorist organization taking dead people and using them as negotiation chips. I don't see the international outline for that type of behavior which would be unacceptable in any type of civilization.

CHURCH: Ruby Chen, we of course hope that you see your son back home with you and your loving family very soon. We thank you for joining us.

CHEN: Thank you for (inaudible).

CHURCH: And we'll be right back.

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[02:32:49]

CHURCH: The U.S. president says his special envoy may make a trip to Russia in the coming days. Donald Trump says officials in Moscow asked Steve Witkoff to visit. If he does, it will come just before Trump's Friday deadline for Russian President Vladimir Putin to make a peace deal with Ukraine. But he doesn't seem to be holding out much hope.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Well, they'll be sanctions, but they seem to be pretty good at avoiding sanctions. You know there are wily characters and they're pretty good at avoiding sanctions. So, we'll see what happens.

(END VIDEO CLIP)

CHURCH: In the meantime, Russia is continuing its assault on Ukraine. Ukrainian officials say a Russian missile strike targeted civilian infrastructure in the southern city of Mykolaiv. At least seven people were injured. The governor of the region says about two dozen homes, 12 apartment buildings and a post office were damaged.

Just ahead, calls are growing for a blue highway in Malibu, California, where residents say a well-known scenic stretch of road has simply become too crowded and too dangerous.

Back with that and more in just a moment.

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[02:37:04]

CHURCH: A volcano in Russia's Kamchatka Peninsula erupted for the first time in 600 years. A tourist group filmed the eruption while returning from a trip to see another volcano. Russian state media says the volcanos eruption could be connected to the massive earthquake that rocked the region last week. Officials in Kamchatka reported an ash plume rising up as high as 3.7 miles, or nearly six kilometers.

The Pacific Coast Highway, also known as PCH, is a vital part of California's transportation system connecting Los Angeles to the state's other coastal cities. But in recent years, a stretch of the PCH in Malibu has seen an increase in accidents and fatalities, worrying those who live in the area.

CNN's Stephanie Elam reports from Malibu, where residents are hoping to use the ocean to ease those traffic concerns.

(BEGIN VIDEOTAPE)

STEPHANIE ELAM, CNN CORRESPONDENT (voice-over): With its stunning rural beauty on the California coast, Malibu is a constant draw. But the Los Angeles wildfires also devastated the enclave, destroying hundreds of homes and businesses along its scenic Pacific Coast Highway.

MICHEL SHANE, FILM PRODUCER AND MALIBU RESIDENT: We're going to be inundated with tourists.

ELAM: Malibu resident, Michel Shane, a film producer known for "Catch Me If You Can," expects with the World Cup, Super Bowl and Olympics all coming to L.A. scores of tourists will pack Malibu as it rebuilds along the compact PCH.

SHANE: There's no space to move. It becomes a situation that's untenable.

ELAM: Shane is among those looking to the ocean for a solution in the form of a blue highway, ferries that can run visitors and locals alike in and out of Malibu, easing the strain on the community, reachable mostly by a single road.

SHANE: And we look out in the ocean and there's no one on the ocean. Why aren't we using the blue highway?

ELAM: It's an idea that's getting some traction, with a ferry service expected to start later this year.

Joined by a pod of dolphins, we set sail with Harbor Breeze Cruises.

PATRICIA KEENEY MAISCHOSS, CHAIR, PIER TO PEIR: We should be spending more time on the ocean and less time in our cars.

ELAM: A group called Pier to Pier is organizing the service between Santa Monica and Malibu.

MAISCHOSS: We've got 700 homes to build on that highway. It cuts us off not only from tourism but affects our residents.

ELAM: That is a stretch of coastline that people love to drive in the convertible.

MAISCHOSS: Don't you think you'd rather take this ride? I mean, I said -- I said bumper to bumper and that congestion, I've done it for 20 years, you'd much rather be on this side of it.

ELAM: The hope is that the ferries would also be able to jump into action in case of another catastrophic emergency like the L.A. firestorm. So many of these people that live up in these hills can only get out by getting to the PCH and that is what makes it so dangerous.

[02:40:00]

During the raging Palisades Fire, dozens of cars were abandoned on the roads as residents were forced to flee on foot. Boat operators say they could have helped.

DAN SALAS, CEO, HARBOR BREEZE CRUISES: Get there to the pier, get them -- get tied up along the pier and then get the people safely during emergency. It's incredibly doable.

ELAM: On 9/11, I evacuated from Manhattan on a ferry. That's how I was able to get away because everything was shut down.

SALAS: It's a must. We are going to have an earthquake someday as well. We have -- can't leave that out.

SHANE: The whole world is going to have their eyes on us.

ELAM: Michel Shane has another reason he wants a safer Pacific Coast Highway. His daughter, Emily, is among 61 people killed on the high speed razor thin PCH since 2010. He welcomes visitors. He just wants everyone to leave this paradise alive.

SHANE: If somebody doesn't do something, the time it takes to do stuff will be forever and the time it takes to kill someone will be instant.

ELAM: Stephanie Elam, CNN, Malibu, California.

(END VIDEOTAPE)

CHURCH: I want to thank you for joining us. I'm Rosemary Church.

For our international viewers, "WORLD SPORT" is coming up next. And for those of you here in the United States and in Canada, I'll be back with more CNN NEWSROOM after a short break.

Stay with us.

(COMMERCIAL BREAK)

[02:45:23]

CHURCH: A warm welcome back to our viewers here in North America. I'm Rosemary Church.

House Democrats and the Texas state legislature are making a last ditch effort to fight Republican plans to redraw the state's congressional map. Some have now left the state, traveling to Illinois, New York and Boston, denying the House the quorum needed to advance the redistricting plan. Critics argue that plan could possibly eliminate five Democratic U.S. House seats ahead of next year's midterms.

Republicans claim the current maps are unconstitutional, but Democratic leaders nationwide say they will fight back with their own redistricting efforts in other states. Illinois Democratic Governor J.B. Pritzker has met with some of the Texas Democrats and encouraged them to keep fighting.

(BEGIN VIDEO CLIP)

JB PRITZKER, ILLINOIS GOVERNOR: You are answering one of the most challenging calls of public service that has ever been asked of you, and you've had to leave behind your families, your full jobs, your communities, and you did it to protect the voting rights of the people that you represent, and voters all across this nation.

(END VIDEO CLIP)

CHURCH: And Texas Democrats are justifying their actions, saying they're standing up for their constituents.

(BEGIN VIDEO CLIP)

CHRIS TURNER, TEXAS DEMOCRATIC STATE REPRESENTATIVE: We are using the power that we have as state legislators under the Texas constitution to fight for our constituents, and we are all elected to fight for the people we represent. And that's exactly what we are doing here today.

(END VIDEO CLIP)

CHURCH: As Democrats nationwide try to figure out their path forward, one of their most powerful voices in the U.S. Senate, Cory Booker, has this advice "don't bend the knee" to Donald Trump. He also suggests Democrats should fight fire with fire when it comes to redrawing congressional maps.

CNN's Manu Raju has more now from Washington.

(BEGIN VIDEOTAPE)

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Democrats are going through a bit of an identity crisis in the aftermath of their steep election losses last November. They've seen their polling at rock bottom really historic lows in public opinion and favorability for their party. So how do they move ahead?

There's been this debate within the party about its tactics, about how to respond to Trump. And this really blew up on the Senate floor last week when Cory Booker, the senator from New Jersey, pushed back against Democratic senators who are trying to work with Republicans to pass policing bills. But Booker has serious concerns about how the administration has been dealing with public safety money.

He says they have been withholding money to blue states like his own because they are not adhering to the Trump agenda. He wanted those bills to more adequately deal with that specific concern. But he also told me there's a larger debate, an issue that he has with Democrats and others that he says they don't -- they should not bend the knee to Donald Trump. In his words, they should push back.

SEN. CORY BOOKER (D-NJ): What I want to see more people doing is not doing what some law firms have done, bend the knee to Donald Trump. Not doing what some universities have done, bend the knee to Donald Trump. We see major corporations who want some merger approval not standing up on principle, but bending the knee to Donald Trump.

That, to me, is outrageous. History is going to remember these people for their complicity in what is -- a guy that's going to severely try to undermine our government, who already incited a riot on our Capitol. This is a moment in history where people are going to ask, where did you stand? Did you bow to an authoritarian leader or did you stand strong and fight? I'm sick of the gerrymandering, but if Donald Trump is going to push to gerrymander Texas, he's going to break the rules in order to win. He can't win by the rules they are right now. So, he thinks you should break the rules.

For Democrats to sit back and just say, okay, were going to play by the rules -- no, I'm telling you right now, we need to win in the midterm. We need to stop him from cheating, from lying, and from stealing the election. And if they're doing something to add their congressional seats, we need to look at our ways of doing that right now.

RAJU: And that last comment, referring to the fight that is happening right now in Texas, where Republicans there are redrawing the district lines for the United States House to add five more Republican seats in next year's midterms. Donald Trump is pushing that to happen now, even though typically these redistricting fights happen at the beginning of a decade. Now, Trump wants this done to help him in the midterms next year.

But Booker there saying New Jersey should respond in kind. A blue state could potentially, if they redraw their lines, add Democratic seats and help them in the midterms and arms race of sorts between the two parties.

[02:50:05]

They try to position themselves for next year's midterm elections, but a sign, too, of the debate within the Democratic Party about how to proceed. As Booker says, it's time to fight back.

Manu Raju, CNN, Washington.

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CHURCH: We now know the names of the four people killed in a bar shooting in Montana. Three men and a woman were shot and killed at the Owl Bar in Anaconda Friday. They are Daniel Edwin Baillie, Nancy Lauretta Kelley, David Allen Leach, and Tony Wayne Palm. All were local residents.

Montana's attorney general says there's an all-out manhunt for the suspect, Michael Paul Brown.

(BEGIN VIDEO CLIP)

AUSTIN KNUDSEN, MONTANA ATTORNEY GENERAL: The vehicle he ended up grabbing was loaded full of equipment. It was not his vehicle. It was a stolen vehicle. But there was camping equipment in it. We believe there was some clothing in it.

So, we -- at this point, we have every reason to believe the suspect is fully clothed. Shoes on his feet, able to get around. We are acting under the assumption that he is alive, well-armed and extremely dangerous.

(END VIDEO CLIP)

CHURCH: Brown is a U.S. Army veteran. His family says he struggled with mental health issues. Officials are offering a $7,500 reward for information that leads to locating him.

A CNN investigation has found that Tesla, Elon Musk's most famous company, has a pattern of not paying contractors who do work for them, even after the work is completed. Musk is the world's richest man, and while he may be known for his ruthless cost-cutting approach, the company is going into business with him and not expecting to be left unpaid.

CNN's Kyung Lah went to Texas to follow the paper trail.

(BEGIN VIDEOTAPE)

KYUNG LAH, CNN SENIOR INVESTIGATIVE CORRESPONDENT: How would you characterize what Elon Musk's company did to you?

JENNIFER MEISSNER, FORMER TESLA CONTRACTOR: It was devastating, what they did.

LAH (voice-over): They is Elon Musk's Tesla, and it had hired Jennifer Meissner's piping and welding company. But she says working for Tesla led to her financial ruin.

And a CNN investigation found dozens of small businesses like Meissner's claim Tesla never paid them for work they did.

LAH: Is someone like you able to fight the world's richest man?

MEISSNER: No. No. I absolutely want to fight him because we were in the right. No small company can litigate against Tesla. You have to take the hit.

LAH: So this is where Meissner says all her troubles began, at the Tesla Gigafactory here in Austin.

Independent contractors like Meissner built this sprawling factory.

Meissner says Tesla stopped paying her after she'd already done the work here, owing her $1.6 million.

And she's not the only one. A CNN investigation found 97 other small businesses say Tesla owed them a total of more than $110 million in the last five years. Tesla still owes more than $24.5 million in unpaid bills to some of those businesses for work already done.

We found most of the accusations against Musk's companies here in civil court in Austin, revealed in thousands of pages of documents.

What I am looking at are a number of liens. Now, a lien is an official document that says my company is owed money for work that has been done. Most liens eventually get paid, but that's not always the case for Tesla.

A Houston fuel company claimed it's owed more than $2.6 million, saying Tesla conjures up reasons to not pay. That claim was recently resolved.

Another Texas company says Tesla ignored written notices and refused to make any payments. Tesla countersued.

An Austin company says it took out short-term loans when Tesla wouldn't pay it nearly $600,000 for work it had done and filed for bankruptcy. Those companies ultimately settled with Tesla.

A hundred eight thousand dollars. This one's $344,000. More than $1 million cited here.

MEISSNER: It's a -- it's just a way of doing business at that point. It's not a one-off. It's not just the companies. It's everyone involved in that company. That's a lot of people to disappoint and hurt.

LAH: Meissner had to take out short-term loans to keep her company afloat and went bankrupt. She eventually settled with Tesla in court, and they agreed to pay her subcontractors $650,000. But Meissner herself wasn't fully paid.

MEISSNER: Material, rental companies, we had up to 60 men. The men is what hurt the most because they believed in us, because we were told it was going to be paid.

[02:55:03]

So they worked for no money. For me not to be able to pay them was difficult.

LAH: So what does the red mean?

MEISSNER: Red means that we were still waiting for payment.

LAH: Court hearings and balancing her books now rules her day-to-day. She works two jobs to pay the debt and is trying to restart her company, Professional Process Piping.

Her main goal? Hold on to her home for her special needs daughter.

MEISSNER: The fear is losing it. The fear is having to give that up to be able to pay debt from the fallout of the bankruptcy.

LAH: How long do you think it will be before you're whole?

MEISSNER: I don't know if I ever will truly be whole for a very long time.

LAH: CNN reached out multiple times to Tesla, but the company did not respond. We did see that during the settlement with Meissner, Tesla said that they were unhappy with her company's work. But Meissner says that she only ever received glowing reviews from Tesla before the bankruptcy.

We also compared Tesla with Apple to see how another big corporation with major construction projects in Texas compares in unpaid liens. Apple owes contractors less than 10 percent of the amount in unpaid bills as compared to Tesla.

Kyung Lah, CNN, Los Angeles.

(END VIDEOTAPE)

LAH: I want to thank you so much for your company this hour. I'm Rosemary Church. I will be back with more CNN NEWSROOM after a short break. Do stay with us.

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