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Early Start with Rahel Solomon

Appeals Court Temporarily Reinstates Trump's Tariffs; Harvard Holds Graduation Ceremony As School Fights With Trump; White House Wants To Triple Daily Immigration Arrests; Official: Israel Accepts U.S. Proposal For Gaza Ceasefire. Aired 5-5:30a ET

Aired May 30, 2025 - 05:00   ET

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

[05:00:26]

RAHEL SOLOMON, CNN ANCHOR: Good morning and welcome to our viewers joining us from the U.S. and all around the world. I'm Rahel Solomon. It is Friday, May 30th, 5:00 a.m. exactly here in New York.

And straight ahead on EARLY START.

(BEGIN VIDEO CLIP)

ANDERSON COOPER, CNN ANCHOR: A federal appeals panel temporarily reinstated the president's tariff policy, a day after a lower court put it on hold.

PETER NAVARRO, PRESIDENT TRUMP'S TRADE ADVISOR: Even if we lose, we will do it another way.

JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT: This is the latest U.S. proposal for a temporary ceasefire between Israel and Hamas.

UNIDENTIFIED MALE: There are signs that this may work, but we've been disappointed time and time again.

BRIANNA KEILAR, CNN HOST: The Trump administration's latest make America wealthy again report includes some references to studies that don't seem to exist.

KAROLINE LEAVITT, WHITE HOUSE PRESS SECRETARY: I understand there were some formatting issues that are being addressed.

(END VIDEO CLIP)

(MUSIC)

SOLOMON: We begin this morning with that new court ruling, which is adding to the uncertainty around President Donald Trump's tariffs. The federal appeals court is reinstating his tariffs, at least for now. That comes a day after the court of international trade ruled that the president lacked the authority to impose sweeping tariffs using emergency powers. Trump and several white house officials are now railing against that decision. Five o' one now, but taking a look at how Wall Street is reacting to

these really whiplash rulings hours before the opening bell, futures are, lets say, fractionally lower for the Dow and S&P. Nasdaq off about 2/10 of a percent. One thing to also watch this morning though is that PCE inflation report. The Fed will be watching that very closely.

But in the meantime, let's get to Phil Mattingly who has more.

(BEGIN VIDEOTAPE)

PHIL MATTINGLY, CNN CHIEF U.S. DOMESTIC CORRESPONDENT: In the span of just 24 hours, the sweeping cornerstone of President Trump's tariff regime was struck down. Then the legal merits behind it, that was struck down again. Then it was paused, or at least the elimination of those tariffs was paused for a short period of time on an emergency basis.

The administration, making very clear they plan to fight on the legal avenues as hard as they possibly can for market participants, Wall Street, businesses, consumers, uncertainty, which has been absolutely pervasive over the course of a series of months, well, certainly this was not a 24-hour period that was helpful on that front. So where does that actually leave things right now?

Well, President Trump's reciprocal tariff, that 10 percent global tariff on all U.S. imports, the currently paused reciprocal tariffs on 60-plus countries, 25 percent tariffs on Mexico and Canada, 30 percent tariffs on China, those still stand for the moment. Behind the scenes negotiations on a bilateral basis with up to 18 U.S. allies, those are still ongoing for the moment. The current agreement with China, that still stands for the moment as well.

However, the legal anvil that is now hanging over the cornerstone of Trump's tariff regime, that is a clear reality, one that administration officials say they are going to fight, one that they make clear they will pursue alternatives to essentially undercut if they end up losing that case in court, and one they have made unequivocally clear in their messaging President Trump plans to stick to, no matter what.

So for companies, for businesses, for consumers, what this all means is -- well, if you thought you were going to have some idea of the rules of the road for months or years ahead, that's not coming any time soon. What you should know, though, is for the administration officials who are in the midst of those bilateral negotiations, they want it known very clearly that for those partners who may be considering pausing or putting things to the side as these legal cases play out, that would be a mistake.

While this may undercut some leverage the administration has, obviously the threat of rapidly expanding tariffs is certainly the critical point they've tried to use in those negotiations for the leverage, the administration is making clear they still want deals. They still think they can get as many as two or three deals in the coming days. They don't want those negotiations to fall apart. That, more than anything else, an outcome on that front, that's what Wall Street wants to see. That's what markets want to see, that's a level of certainty that certainly hasn't existed up to this point.

But it is absolutely the case that as these court cases play out, as the brief freeze runs out on June 9th, there's just more uncertainty. Nobody really knows what's going to happen next.

Phil Mattingly, CNN, Washington.

(END VIDEOTAPE)

SOLOMON: And in a very long Truth Social post, President Trump slammed the Wednesday ruling against his tariffs and questioned the authority of the three-judge panel.

[05:05:05]

He said, quote, is it purely a hatred of Trump? He's now calling the Supreme Court to step in, arguing that his presidential power is being undermined.

White House officials are also pushing back against the ruling and defending Trump's economic agenda.

(BEGIN VIDEO CLIP)

PETER NAVARRO, PRESIDENT TRUMP'S TRADE ADVISOR: What we see this is as this broader problem of rogue judges erecting essentially a judicial blockade.

KAROLINE LEAVITT, WHITE HOUSE PRESS SECRETARY: The courts should have no role here. There is a troubling and dangerous trend of unelected judges inserting themselves into the presidential decision-making process.

(END VIDEO CLIP)

SOLOMON: Now, it was a coalition of small business owners in 12 states that challenged the legality of President Trump's tariffs. Reilly Stephens is senior counsel at Liberty Justice Center, which represented those small businesses. And he joins us now this morning from Baltimore.

Reilly, great to have you.

Just, first, your response to this new decision out of the appeals court.

REILLY STEPHENS, SENIOR COUNSEL, LIBERTY JUSTICE CENTER: Great to have you -- great to be here.

So, the decision of the appeals court is simply a temporary kind of administrative stay that says that give us the -- saying, give us a minute to read this stuff, essentially. And so, I -- you know, we don't read too much into that other than that the courts, you know, normally want to try and take their time when they can. And so, they've set a briefing schedule on the government's motion to stay.

They actually haven't granted the motion other than just to give the government a couple of weeks here to -- so they can hash this out. So, we don't worry too much about that. We still think that the Court of International Trade's decision was incredibly strong, we're very proud of that opinion. And we think that that will stand up on appeal.

SOLOMON: Fair enough. It's more of an administrative pause to sort of allow the government to have more time. I take that point.

Reilly, we talk a lot about the whiplash that these tariff policies have caused Wall Street, have caused investors, but I imagine no one has felt the whiplash more than the business owners who are directly affected by these policies. Have you heard from any since this new stay was announced? I mean, what are you hearing from your clients?

STEPHENS: Sure, yeah. I mean, we've talked to a few of our clients. I mean, I think they've been -- they've been going through whiplash here perpetually over the past few months. So, this is nothing new in that regard.

You know, I mean, they -- it's, you know, it's not just these court decisions, but it's the, the president's decision that, you know, on any given day, the tariff on China is 30 percent of (ph) 145 percent. Next week, it would be 90 percent.

You know, then they're paused for 90 days, then it's 91 days. In 91 days, if you order something now and it gets here in 93 days, is that going to -- what's the tariff on that going to be?

These are the problems that are inherent in the policy that the government has tried to pursue here. And so, I mean, you know, it's not -- it's not just -- the courts are not the source of the whiplash. The courts are simply here to say that, you know, this sort of authority does not belong to the president in the end.

SOLOMON: Yeah. And, Reilly, as I understand it, the heart of this matter legally is whether this 1977 law, which grants the president a set of special powers to confront urgent threats, was applied appropriately here.

I want to play for you something the Vice President J.D. Vance who, of course, does have a law degree, said, and get your response to it.

(BEGIN VIDEO CLIP)

J.D. VANCE, VICE PRESIDENT OF THE UNITED STATES: We believe, and we're right, that we are in an emergency. You've seen foreign governments, sometimes our adversaries, threaten the American people with the loss of critical supplies.

I'm not talking about toys, plastic toys. I'm talking about pharmaceutical ingredients. I'm talking about the critical pieces of the manufacturing supply chain. If these governments are threatening to cut us off from that stuff,

that is, by definition a national emergency. And in that national emergency, the president has very broad discretion to fight back.

(END VIDEO CLIP)

SOLOMON: Reilly, your response? I imagine you have a very different interpretation of the law than the vice president.

STEPHENS: Well, as you said, this is not just about any particular policy or foreign policy preference. This is about a particular statute. IEEPA is how it goes.

And that statute says that -- number one, it says what you can and can't do, it doesn't have the word "tariff" in it. So, it doesn't actually include the power to impose tariffs. They're reading that into the idea of a general regulation of trade.

But number two, it says that you don't need a national emergency. You need a national emergency that is caused by an unusual and extraordinary threat.

Trade deficits, which is the basis of this national emergency, are not unusual or extraordinary. We've had trade deficits in this country pretty much since World War II. The trade deficit peaked in 2006. It peaked 20 years ago. We are not at the all-time high of trade deficits.

So, this is not an unusual situation. This is a perfectly ordinary and usual one. And so, that is -- the question here is, legally, what -- you know, what does the statute say?

[05:10:07]

The statute says that they don't have the power to do this.

SOLOMON: Yeah. I mean, the administration would also point to the flow of fentanyl as one of the emergencies that they point to. But one thing that I do want to get to, Reilly, as well is that the impression that this will likely go to the Supreme Court. The court has already ruled in ways that have expanded presidential powers.

I'm curious if you feel confident in your chances with this court on this case.

STEPHENS: Well, you never count your chickens before they're hatched. But, I mean, the court has been very strong in recent years on the excesses of presidential power and the excesses of delegations of presidential authority from the Congress and the president's attempts to use vague and broad grants of authority in new and inventive ways, right?

The OSHA vaccine mandate, the student loan debacle, some of the things that have happened around the EPA and some of the climate change regulations. Supreme Court has said over and over again that you cannot read into the general grant to HUD, for instance, to regulate housing policy, that HUD can control evictions nationwide, right? That -- or the -- right, or that the CDC can control evictions nationwide.

And so, you know -- and so, you know, we think that that line of cases firmly makes very clear that the president's claim here that this vague statute gives him the authority to set whatever tariffs he wants on it, whatever country he wants, at any rate, he wants anytime he wants simply should not stand. And we hope that it will not stand.

SOLOMON: Yeah. I mean, it may be the Supreme Court that ultimately decides this on this specific law, although the administration has said that there are other avenues they may pursue to try to get across their tariff policies. Clearly, still a lot of uncertainty in the air.

Reilly Stephens, we appreciate you being with us this morning live from Baltimore, Maryland, there.

Well, three Trump administration officials tell CNN that frustration over trade talks with China are behind White House plans to revoke visas for Chinese students. But the U.S. State Department says that the visas are being revoked because of national security concerns. China, meantime, says that the move is politically motivated and discriminatory. Meanwhile, U.S. embassies and consulates have paused new appointments for student and exchange visas. A State Department spokesperson says that those could become available sooner rather than later.

A federal judge in Boston says that she will block the White House from ending Harvard's ability to enroll international students. This comes as the school held its commencement ceremony on Thursday.

And CNN's Danny Freeman was there.

(BEGIN VIDEOTAPE)

DANNY FREEMAN, CNN CORRESPONDENT (voice-over): An emphatic show of support at Harvard University today for the school's president at graduation.

(CHEERING)

FREEMAN: As the historic Ivy League university continues to battle with the Trump administration over federal funding, antisemitism, and now enrolling international students.

ALAN GARBER, PRESIDENT, HARVARD UNIVERSITY: Members of the class of 2025, from down the street, across the country and around the world.

(CHEERING)

GARBER: Around the world, just as it should be.

(CHEERING)

FREEMAN: Despite a federal judge halting the effort to ban Harvard from enrolling international students, the administration is now threatening to aggressively revoke visas for Chinese students across the country. While some Chinese students on campus were hesitant to speak to CNN today, a master student from China made a plea for empathy during the commencement ceremony.

YURONG "LUANNA" JIANG, 2025 HARVARD GRADUATE FROM CHINA: When I met my 77 classmates from 32 different countries --

(CHEERING)

JIANG: -- the countries I knew only as colorful shapes on a map turned into real people with laughter, dreams.

FREEMAN: Though the tumultuous school year is now finally over, fears about the future linger at Harvard.

For international students --

LEO GERDEN, HARVARD GRADUATING SENIOR FROM SWEDEN: It's all of these crazy things that people are thinking about in this moment. Can I transfer to another institution? Is it worth doing it in the U.S.? Because what if Trump goes after that university next?

FREEMAN: And fears linger for researchers whose federal funding is still frozen or canceled.

PROF. MARC WEISSKOPF, HARVARD T.H. CHAN SCHOOL OF PUBLIC HEALTH: How to protect your brain as you're aging and stay -- keep your quality of life so you're not heading into dementia, or not getting cancer, or not getting cardiovascular disease. Those advances take time to develop. And so, we are putting that off if not stopping them.

[05:15:00]

PROF. WALTER WILLETT, HARVARD T.H. CHAN SCHOOL OF PUBLIC HEALTH: If we pull the rug out from under our research, we're going to miss a huge opportunity that no amount of money can buy.

FREEMAN: But today, Harvard's graduating class set the stage for tomorrow's fight.

THOR REIMANN, 2025 SENIOR ENGLISH ORATOR: Now, look, our university is certainly imperfect, but I am proud to stand today alongside our graduating class, our faculty, and our president with these shared conviction that this ongoing project of veritas is one worth defending.

(END VIDEOTAPE)

FREEMAN (on camera): Now, one thing that also struck me while being on campus this week is perhaps the unlikely amount of unity that really has grown at Harvard University after this battle with the Trump administration. Remember this university that's been very divided in recent years. The former president had to resign last year. Theres been a lot of back and forth and division over accusations of antisemitism and many protests on campus.

But on this issue, you have administrators, faculty members, even students all coming together to defend the university.

Danny Freeman, CNN, Cambridge, Massachusetts.

SOLOMON: White House pressure to triple the arrest of migrants in the U.S. is said to be straining law enforcement resources. Hundreds of FBI agents and other law enforcement officers have been reassigned to immigration related duties, and people familiar with the matter say that there are concerns that the changes could hinder other important investigations, such as terror threats and espionage by China and Russia. There are currently about 1,000 immigration arrests a day.

Still ahead for us, Hamas response to the latest U.S. proposal for a ceasefire in Gaza. What he'd want in exchange for releasing all of the remaining hostages.

And later, a woman who worked for Sean "Diddy" Combs, testifies about years of abuse. We'll have those details when we return.

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SOLOMON: Welcome back.

An Israeli official and the White House confirmed that Israel is backing a new U.S. plan for a 60-day ceasefire in Gaza. The official says that it calls for the release of ten living and 18 deceased hostages. Hamas says that it's willing to turn over all of the hostages, but it also has some demands. The group wants assurances that the fighting will not resume after the 60-day truce. It also wants all humanitarian assistance carried out through U.N. channels, and it's demanding that the IDF pull back to positions they held on March 2nd, before Israel relaunched its military operations.

More now from CNN's Jeremy Diamond.

(BEGIN VIDEOTAPE)

JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT: Well, listen, this is the latest U.S. proposal for a temporary ceasefire between Israel and Hamas, one that could lead to an end to the war if the negotiations between the two sides are successful. But for the time being, what this latest proposal involves would be the release of 10 living hostages, 18 deceased hostages in exchange for a 60-day ceasefire.

This would also presumably include the release of Palestinian prisoners as well as the flow of humanitarian aid into Gaza. And during that 60-day ceasefire, they would be negotiating an end to the war, which Steve Witkoff, President Trump's special envoy for the region, told me earlier this week he would personally preside over. That's a gambit to try and give Hamas the assurances it has been seeking, that Israel will actually negotiate a permanent ceasefire, which it failed to do during that last temporary ceasefire earlier this year.

We are now into the first week of the Gaza Humanitarian Foundation being operational in the Gaza Strip. This is that controversial U.S. and Israeli-backed mechanism for getting aid into Gaza in a way that it will prevent Hamas from getting its hands on the aid, which is an allegation Israel has made, but which humanitarian aid organizations have said they've seen no evidence to substantiate.

We've already seen 11 people killed near these distribution sites, according to the Palestinian Ministry of Health. We know that there has been Israeli gunfire in the area. The Israelis have said that it was aimed at dispersing the crowds. But clearly we have seen video of individuals who were struck by some of that gunfire.

And what's also clear is that the humanitarian situation in Gaza simply has not been alleviated as of yet. And that's why we are seeing such scenes of desperation at the moment, not only around these distribution sites, but it is especially acute in the northern part of the Gaza Strip, where this new Gaza Humanitarian Foundation is not yet operational, and where the Israeli authorities have really provided almost no safe routes for the United Nations to drive its trucks to the northern part of the Gaza Strip.

And amid all of this, we are seeing the desperation of Palestinians as we reach a grim milestone of more than 54,000 who have been killed in this war. And all of this has led the Palestinian ambassador to the United Nations to break down this week in this emotional moment.

Watch.

RIYAD MANSOUR, U.N AMBASSADOR TO THE PALESTINIAN TERRITORIES: It is unbearable. How could anyone tolerate this horror? Excuse me, Mr. President, I have grandchildren. I know what they mean to their families.

And to see the situation of the Palestinians without us having hearts to do something is beyond the ability of any normal human being to tolerate.

DIAMOND: And all of this comes as we have reached more than 600 days of this war, 600 days as well of the captivity of the Israeli hostages in Gaza.

[05:25:06]

And it is important to know that those former hostages, like Keith Siegel, an Israeli-American who I interviewed earlier this week, they want to see the war end.

They believe that a diplomatic deal is the only way to get the hostages out of Gaza alive. And they are calling on the Israeli government and on Hamas to reach this deal in order for the hostages to come out and for the war to end.

(END VIDEOTAPE)

SOLOMON: Our thanks to Jeremy Diamond there.

Israel has approved the biggest expansion of West Bank settlements since the Oslo Accords were signed more than 30 years ago. According to the defense and finance ministers, 22 new settlements will be established deep inside the West Bank, in an area from which Israel had previously withdrawn. This is seen as a de facto annexation of the Palestinian territory.

Israel's far right minister said that outright that the expansion is intended to prevent the establishment of a Palestinian state. The Palestinian Authority is condemning the move as a dangerous escalation and a challenge to international law.

All right, still ahead for us, a new government report focused on children's health coming under scrutiny. Just ahead, details about what's been discovered in the administration's Make America Healthy Again report when we come back.

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