Return to Transcripts main page
Early Start with Rahel Solomon
Trump Delays 50 Percent Tariff on EU Goods; Trump Vents His Frustration with Putin, Says He is Not Happy with What Putin is Doing; U.S. Celebrates Memorial Day. Aired 5-5:30a ET
Aired May 26, 2025 - 05:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[05:00:00]
POLO SANDOVAL, ANCHOR, EARLY START: Good morning and welcome to all of our viewers joining us from the United States and all around the world, I'm Polo Sandoval in for Rahel Solomon. Monday, May 26th, 5:00 a.m. here in New York on this Memorial Day. And straight ahead on EARLY START.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: The U.S. President has announced he is delaying a 50 percent tariff on European goods.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: July 9th would be the day.
UNIDENTIFIED MALE: President Donald Trump is ramping up his rhetoric against Vladimir Putin.
TRUMP: I'm not happy with what Putin is doing, I don't know what the hell happened to Putin.
UNIDENTIFIED MALE: It's Memorial Day in the U.S.
UNIDENTIFIED MALE: When is the unofficial start of Summer? Forty five percent say it is this weekend, Memorial Day weekend! Yes.
(END VIDEO CLIP)
SANDOVAL: And we begin this Memorial Day Monday with the latest instance of Donald Trump's tariff whiplash. The U.S. President is now walking back threats on the European Union. He has announced that he is delaying a 50 percent tariff on European goods until July 9th. As recently as Friday, President Trump said that he was, as he put it, not looking for a deal with the EU, and that their tariff rate would go into effect next Sunday.
Well, now, he says after what he describes as a very nice call with European Commission President Ursula von der Leyen, trade talks are expected to begin very soon.
(BEGIN VIDEO CLIP) TRUMP: And she asked for an extension in the June 1st date. And she
said she wants to get down to serious negotiations. July 9th would be the date. That was the date she requested. Could we move it from June 1st to July 9th? And I agreed to do that, and that, she said, we will rapidly get together and see if we can work something out.
(END VIDEO CLIP)
SANDOVAL: And for her part, von der Leyen has also praised the call, saying that Europe is ready to negotiate. She posted on X, quote, "the EU and the U.S. share the world's most consequential and close trade relationship." She also added that they need the extra time to reach a good deal. As we know, the U.S. stock market, it is closed today because of the Memorial Day holiday.
But following news of President Trump's EU tariff delay, European shares seem to have surged. Let's take a look at where some of those stand right now. You can see sort of a mixed bag when it comes to European markets. Trump's news also sending some reactions throughout Asian markets as well.
Where you see there, some modest to mixed gains as well on this Monday morning again. The world reacting to what we heard from the commander- in-chief of the United States over the weekend here. Consumers meanwhile, they say that they are bracing for higher prices as President Trump continues to threaten more tariffs.
And the list of major companies that are warning consumers about potential price hikes, that list continues to grow. That includes Walmart, which has said that Trump's tariffs are simply too high, and other brands like Mattel, also Ford, anything from groceries and clothing to toys and cars that could potentially cost Americans more in the weeks or months to come.
The President has told companies like Walmart to just eat the tariffs, and he's now threatened to impose a 25 percent tariff on Apple unless it moves iPhone production to the U.S., which remember, some analysts have said that, that could potentially triple the cost of that device in your pocket. He also warned that Samsung and other companies, other tech companies could be next.
All of this coming as Americans' optimism about the economy as it is at a near-record low. And that's according to the University of Michigan's closely-watched consumer sentiment index. Let's bring in Ryan Patel now, a Senior Fellow with the Drucker School of Management at Claremont Graduate University, joins us now live from San Diego, California. Good morning to you.
RYAN PATEL, SENIOR FELLOW, DRUCKER SCHOOL OF MANAGEMENT, CLAREMONT GRADUATE UNIVERSITY: How are you doing?
SANDOVAL: I'm doing pretty well, bracing for the potential impact yet again here. It seems to be this whiplash effect that we've been experiencing, and we're so glad that you're there with us to lead us through all of this. You know, from big box retailers to apparel stores and household goods, wondering if you might be able to give us some perspective about -- some general perspective about how prices are likely to change when you look at everything in front of you, a Nintendo switch, perhaps a barbie or a pair of Nikes, just overall.
[05:05:00]
And I say, generally, because I know it's kind of tough. How much more will consumers have to spend?
PATEL: Well, I think there's a first thing you have to see, the price hikes. You're seeing the price -- you know, the pressure ripple through every layer of the supply chain. You mentioned some companies as Ford, Walmart, Best Buy. There's different parts of what that looks like. So, it's really a stress test on what the margins and the customer loyalty.
You're going to be asking what costs can be passed on and what's the strategy behind it? So, if you think, Mattel says 40 percent to 50 percent of their toys will stay under $20, and that's more of a strategic choice. It's not just pricing. You know, for me, you kind of see the positioning. And so, really, the smarter play is just not just reacting, but for customers, how much will they be able to pay for it. And these brands are getting out in front of it, trying to see what people will pay more for.
SANDOVAL: Also curious about this needle that these companies have to thread, right? This delicate line, they have to warn consumers and certainly their shareholders about the potential price hikes, but also try to stay off the President's radar, which is pretty much nearly impossible. You mentioned Mattel.
We all know the story of Walmart as well, which the President said would have to eat the costs rather than pass it on to the consumer. How do these big companies really sort of navigate this delicate line and take, as you point out, the strategic point -- standpoint?
PATEL: Yes, I mean, let's be honest. If you're a lean company right now, you are taking everything out of the margin. So, what does that mean is that you're being really lenient on the cost of goods. You're being -- you know, you're trying to squeeze every single penny so that you can make a higher profit. But if you take on this cost as a company, you possibly in the red.
And so, when you think of Ford, you think of Procter & Gamble, they're just not updating kind of, you know, their new, you know, new price points. They're kind of resetting customer expectations. What I mean by that is that they're using this moment to really ask the consumer and themselves what value do they think that this new price point will have -- you know, hold.
And that's a hard decision to make. But they have to make --
SANDOVAL: Yes --
PATEL: It right now because over the next 30 days or 60 days, they're not really sure what is going to happen. They have to be very transparent to a customer law base that they need to talk to. SANDOVAL: Yes, and do you think maybe some of these big companies
have a little more leverage over the President's tariff policies, maybe have a little more freedom to speak out a little louder than others?
PATEL: No.
(LAUGHTER)
PATEL: I mean, well, I say -- I say that kind of jokingly because they're really needing to talk to who first, the consumers --
SANDOVAL: Right --
PATEL: They should be -- they should be talking to Washington D.C., I believe that they'll have open doors to -- you know, to President Trump. They need to. Companies like Walmart, I know they do, the question becomes, can they coordinate a deal that makes it, you know, a little bit easier for all?
And you have to assume if you're a big U.S. company, you want to be able to not be in the radar of President Trump and those, you know, extra taxes that they want to pay. You just assume it's a win-win situation that somebody's going to find out.
SANDOVAL: Yes, to your point, the Treasury Secretary has said publicly that he's been in contact with the Walmart CEO. So, yes, those conversations do happen. And as the consumers, we wish we were in on those to know how much to spend or not. Ryan Patel, you're on the west coast weather, you're staying up late with us or up early, we really appreciate you.
PATEL: Appreciate you as always.
SANDOVAL: Any time. Well, President Trump's Big, Beautiful Bill, it is now headed to the U.S. Senate after narrowly passing in the House just last week. But the sweeping tax and domestic bill policy is already facing some pushback from some Senate Republicans, some concerned about the potential impacts on the national debt, the changes to Medicaid and the tax credit levels. Trump has already acknowledged that fairly significant changes could be coming.
(BEGIN VIDEO CLIP)
TRUMP: I think the Senate is going to get there. I hope they're going to get there. I think they're going to have changes. Some will be minor and some will be, you know, fairly significant. But we've been working with the House all the way up. They've been working together, and the speaker has been working with the leader of the Senate. And you know, they've done a great job.
(END VIDEO CLIP)
SANDOVAL: Jenn Sullivan breaks down what's in the bill and the challenges that it faces in the Republican-led Senate.
(BEGIN VIDEOTAPE)
JENN SULLIVAN, CNN NEWS REPORTER (voice-over): The Republican-led House narrowly passing a spending bill Thursday. The ambitious legislation could be modified by the Senate. President Donald Trump calling it the Big Beautiful Bill, which focuses on slashing taxes and federal spending.
REP. MIKE JOHNSON (R-LA): We're cutting over $1.5 trillion in federal spending.
[05:10:00]
SULLIVAN: One potential problem, increased debt. The Congressional Budget Office says the legislation would add another $3.8 trillion to the already huge U.S. debt. Fiscally conservative Republicans in the Senate aren't happy about that, and Democrats argue tax cuts would go largely to the rich.
REP. HAKEEM JEFFRIES (D-NY): The GOP tax scam represents an assault on the economy.
SULLIVAN: The bill passed by the House would mean deep cuts to programs like SNAP, the Supplemental Nutrition Assistance Program, which provides food stamps for roughly 42 million Americans. The Congressional Budget Office's recent analysis of the bill found it would strip roughly 3.2 million people of their food stamp benefits in an average month over the next decade.
Some Republicans think it doesn't slash spending enough and want to see further cuts.
SEN. RON JOHNSON (R-WI): The first goal of our budget reconciliation process should be to reduce the deficit.
SULLIVAN: While Democrats worry these cuts will only hurt already struggling Americans.
SEN. MICHAEL BENNET (D-CO): Democrats should be figuring out not just how to stop these cuts, but to give the American people a vision for what a modern health care system that looks like the rest of the industrialized world would look like for the American people.
SULLIVAN: President Trump has said, he would like the legislation to clear the Senate by July 4th, but that may be optimistic. I'm Jenn Sullivan reporting.
(END VIDEOTAPE)
SANDOVAL: And President Trump is escalating his attacks on Harvard University. He is now demanding the names and countries of thousands of international students at the Ivy League School. Mr. Trump suggested that foreign countries, some of which he says are hostile to the U.S., should be the ones contributing funding to educate their students.
(BEGIN VIDEO CLIP) TRUMP: There are 31 percent, but they refuse to tell us who the people are. We want to know who the people -- now, a lot of the foreign students we wouldn't have a problem with. I'm not going to have a problem with foreign students, but it shouldn't be 31 percent. It's too much because we have Americans that want to go there and to other places, and they can't go there.
(END VIDEO CLIP)
SANDOVAL: The comments you just heard come just days after a federal judge temporarily halted his administration from banning Harvard's international students, nearly a quarter of them. Russia's attacks across Ukraine over the weekend, they have drawn swift criticism from Donald Trump. What the U.S. President is saying next.
Also on the way, at least 20 people were killed overnight when an Israeli airstrike hit a school housing displaced Palestinians. And later, a closer look at how Donald Trump's tariffs could impact both the cost and availability of your prescription drugs.
(COMMERCIAL BREAK)
[05:15:00]
SANDOVAL: U.S. President Donald Trump says that Vladimir Putin has gone, quote, "absolutely crazy" after Russia unleashed its largest ever aerial assault on Ukraine. Mr. Trump's comments on social media followed earlier criticism of the Russian President in front of reporters.
(BEGIN VIDEO CLIP)
TRUMP: I'm not happy with what Putin is doing. He's killing a lot of people, and I don't know what the hell happened to Putin. I've known him a long time, always gotten along with him, but he's sending rockets into cities and killing people, and I don't like it at all, OK? We're in the middle of talking, and he's shooting rockets into Kyiv and other cities. I don't like it at all.
(END VIDEO CLIP)
SANDOVAL: The U.S. President's disapproval goes both ways. He also criticized Volodymyr Zelenskyy, who said -- who he said, quote, "isn't doing his country favors by talking the way he does." Now, Trump clearly reacting to comments from the Ukrainian President who blasted the silence from some around the world as this war continues to drag on.
Zelenskyy said, quote, "the world may go on vacation, but the war continues, despite weekends and weekdays, this cannot be ignored. America's silence and the silence of others in the world only encourages Putin." Again, the words from the Ukrainian President. That reaction after Russia hit the capital and other regions across Ukraine overnight on Sunday with missiles and drones killing at least 12 people, children among the dead. The assault coming despite the largest prisoner swap of the war that
was completed on Sunday. CNN's Nic Robertson, tracking all those developments from London. Nic, you and I spoke about this prisoner swap last week, it seems to have gone off successfully. But tell us more about these Russian airstrikes over the weekend.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, it seemed that President Trump was quite encouraged on Friday by the possibility of the prisoner swap, saying that something big was coming. I don't think he clearly anticipated what President Putin had in mind over the weekend. It was a three-day prisoner swap, a thousand prisoners on both sides exchanged.
But Friday night, the first day of that prisoner swap into Saturday, 250 Russian missiles and drones hitting into Ukraine, 13 people killed, the following night, Saturday into Sunday, the biggest round of missile strikes so far. Total, 367, 12 people killed, huge explosions seen in the capital, Kyiv.
And then overnight, Sunday into Monday today, you have the biggest yet since the war began drone assault on Ukraine, 355 drones, accompanied by nine cruise missiles, which by the way, Ukraine says it shot down all those cruise missiles. But it gives you something of a sense of the scale of assault that President Putin had in mind when he went into that prisoner exchange on Friday.
Clearly, President Trump, unhappy, but perhaps beginning to see what some of his allies already see, that Putin has his own agenda.
[05:20:00]
And it's not one that's going to curtail itself to what President Zelenskyy says or President Zelenskyy's western backers. So, the question then becomes, how does President Trump take this forward? It's clear that in his conversations so far, is considered President Putin is somebody who he can talk to. Is this real, a real sea change in what President Trump's analysis of President Putin is?
How will he move it forward from here? Clearly, Ukraine is asking for the continued support of its western allies like the United States, Europeans. This would seem -- one would expect to lead to more pressure on Russia to desist. But how will that manifest from President Trump's phone calls or actually military support for Ukraine and further sanctions, which is what President Zelenskyy is calling for.
SANDOVAL: CNN's Nic Robertson in London, thank you, Nic. North Korea has arrested four people it blames for the failed launch of the country's newest warship. That's according to state media. Kim Jong un witnessing the accident last Wednesday when a launch mechanism reportedly malfunctioned, and that caused the ship's stern to slide into the water prematurely, resulting in damage to the hull.
Kim called it a criminal act, and vowed to punish those responsible for this. Satellite imagery now showing most of the warship covered in blue tarps as repairs to that ship get underway. Still to come on your EARLY START, desperation in Gaza, Israel's strict limits on humanitarian aid are pushing more people to the brink of starvation.
(COMMERCIAL BREAK)
[05:25:00]
SANDOVAL: An Israeli airstrike in Gaza city overnight killed at least 20 people and wounded a large number of others, according to a local hospital, most of the victims are women and children. Gaza's Civil Defense says that the strike hit a school where displaced people were sheltering. Emergency workers describing the gruesome scenes including bodies charred beyond recognition.
The Israel Defense Forces and Israeli security agency maintained that they struck a Hamas and Islamic Jihad command and control center, as they describe it. They say it was embedded in the area around the school. Meanwhile, Palestinian officials say Israel's strict limits on humanitarian aid is killing even more people.
According to the Hamas-run Palestinian Ministry of Health, 58 people have died from malnutrition and 242 others have died due to shortages of food and medicine since early March. Last week, Israel ended its 11-week blockade and started allowing what it described as basic food amounts into Gaza.
Hundred and seven trucks entered the territory on Sunday, but the U.N. says that's not nearly enough. Humanitarian groups are now having difficulty delivering that limited aid to the people who desperately need it. The World Food Program says that it is stopping production of bread at some of the bakeries, citing serious security risks that only adds to the growing desperation among some of the civilians experiencing hunger.
(BEGIN VIDEO CLIP)
ASMAA AL-KAFAMEN, GAZA RESIDENT (through translator): We come to the charity kitchen, and without it, we don't eat. We are starving in Gaza. We thank any group that supports us. I swear I haven't eaten bread in two months, my children brought me moldy bread two hours ago, and we ate it out of hunger. I wish any organization would help, even just with bread. We desperately need even the simplest things.
(END VIDEO CLIP)
SANDOVAL: And then there's this -- head of a U.S. group -- that's a U.S.-backed group, I should say, that's tasked with delivering food to Gaza has resigned. Jake Wood, a U.S. military veteran led the Gaza humanitarian foundation. The U.N. and other aid groups have criticized the group, saying that the way it intends to work actually violates basic humanitarian principles.
On Sunday, Wood announce that he would be stepping down saying, quote, "I am proud of the work I oversaw, however, it is clear that it is not possible to implement this plan while also strictly adhering to the humanitarian principles of humanity, neutrality, impartiality and independence, which I will not abandon." Nada Bashir joining us live now from London. Nada, as this humanitarian crisis continues to worsen, another round of airstrikes in Gaza. What can you tell us about those?
NADA BASHIR, CNN CORRESPONDENT: That's right, Polo. We are seeing the expansion yet again of Israel's ground and air operation across the Gaza Strip. We've seen those renewed evacuation orders for civilians to move out of so-called conflict areas to safe zones where they are said to be protected, according to these maps provided by the Israeli military.
But the warnings that we've repeatedly heard now from humanitarian organizations is that, there is simply nowhere safe to go. And the overnight strikes that we saw last night, yet another example, a school or a former school now sheltering hundreds, if not thousands of civilians, as are many of those remaining schools in the Gaza Strip struck just after midnight last night.
And we have seen distressing video emerging from the aftermath of that strike. The building, parts of it turned to rubble, still on fire as emergency workers attempted to put out the flames. Some of those civilians in the area also trying to help simply with buckets of water. But as you mentioned, at least 20 people have been confirmed, according to Palestinian health authorities in the Gaza Strip, to have been killed.
Many of those who were killed and injured, of course, dozens more were wounded, were taken to the Al-Ahli Baptist Hospital, and it is there that hospital officials have said that while they were able to identify the bodies of --
