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Early Start with Rahel Solomon

Trump Revamps Tariff Policy; Epstein Victim's Family Speaks Out; NYPD Officer Laid Rest; U.S. Envoy Witkoff Visits Aid Distribution Site In Gaza. Aired 5-5:30a ET

Aired August 01, 2025 - 05:00   ET

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

[05:00:21]

MIN JUNG LEE, CNN ANCHOR: Good morning and welcome to our viewers, joining us from the United States and all around the world. So glad you're with us. I'm MJ Lee. Rahel Solomon is off.

It's Friday, August 1st, 5:00 a.m. here in Washington, D.C.

And straight ahead on EARLY START.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: The Trump administration's global trade war, it is intensifying.

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We're taking in literally trillions of dollars for the country.

SKY ROBERTS, VIRGINIA GIUFFRE'S BROTHER: No, she wasn't stolen. She was preyed upon.

KAITLAN COLLINS, CNN HOST: Donald Trump says he wasn't aware of what Jeffrey Epstein was really up to all those years ago. But Virginia Giuffre's family wants answers.

OMAR JIMENEZ, CNN CORRESPONDENT: Fellow officers, friends and family gathered to honor fallen NYPD officer Didarul Islam.

DEPUTY INSPECTOR MOHAMMED ASHRAF, COMMANDING OFFICER, 47TH PRECINCT: But your purpose brought you here to these streets, to this city.

(END VIDEO CLIP)

(MUSIC)

LEE: Dozens of countries across the world are reeling from the new tariffs announced by President Trump for what he says is for the benefit of the U.S. economy. Despite administration officials insisting that today was definitely tariff day, no more extensions, no more grace periods, the government appears to have gotten ahead of itself. We're told U.S. Customs and Border Protection needed more prep time, so the deadline has been pushed back six days. But this delay will, in theory, give more countries more time to negotiate trade deals. Come Thursday, countries with a trade surplus will face a universal 10

percent tariff rate, and about 40 countries with which the U.S. has a trade deficit will pay 15 percent, and any goods transshipped through other jurisdictions to dodge U.S. duties will get walloped with an additional 40 percent tariff.

President Trump talked up the plan on Thursday.

(BEGIN VIDEO CLIP)

TRUMP: We have made a few deals today that are excellent deals for the country. You know, we're taking in literally trillions of dollars for the country. This is making our country very rich and respected again.

(END VIDEO CLIP)

LEE: But the heavy-handed U.S. approach is raising fears of rampant inflation, as rising costs are likely to get passed on to consumers.

And now to the fallout in Asia.

CNN's Marc Stewart is live in Beijing.

Marc, markets are closed in Asia, opening up in Europe. What are you seeing?

MARC STEWART, CNN CORRESPONDENT: Hi, MJ. Good to see you.

Look, if markets are a messenger service as to how people may be feeling right now, these tariffs are clearly bringing on feelings of anxiety and of trepidation.

Let's look at what happened today here in Asia. We saw declines across all of the major indexes. That includes Japan, Hong Kong and South Korea, which just agreed to a trade deal with the United States. We saw decline of nearly 4 percent. For those of us who watch the markets here in Asia, that's a lot.

South Korea agreed to a 15 percent flat tariff, but it also agreed to invest billions of dollars in the United States. But it's not being met with welcome arms, at least in this part of the world.

As you mentioned, the trading day is now underway in Europe. Let's look at the numbers there. And we are seeing also a very rough start to the trading day in Europe. All the major indexes there are also seeing declines, an indication that people are just not stomaching this too well. The FTSE in the U.K., as well as the Dax in Germany, also seeing declines.

And this sets the stage for the market open in New York, where U.S. futures are down. That includes the S&P 500. That is an important index to watch because it is where so many of our retirement accounts, are 401ks are based on the S&P 500. So that's going to be something to watch. You know, MJ, the numbers don't tell everything. But they do tell a

narrative. And right now, this is a narrative of apprehension and uncertainty, as this tariff -- as these tariff moves become closer and closer to fruition.

LEE: Absolutely. And mark a potential trade deal with China is, of course, still outstanding. What are you learning from your post in Beijing?

STEWART: Right. So, the U.S. and China had trade talks earlier this week in Stockholm, Sweden, ending on what's being portrayed as a very positive note. But they -- but neither side has had a handshake, so to speak, to extend the tariff deadline there that's set to expire October 12th. That could bring those hefty tariffs back into play.

[05:05:01]

This is a very tricky relationship. This is not just about tariffs. It's about rare earth minerals which are these crucial substances that China has a big surplus of, which are used by American companies to make everything from electronics to lighting to electric vehicles.

And of course, China would like access to American chips, which are so crucial in the A.I. race.

Right now, both sides are remaining silent. The treasury secretary said. This is really up to President Trump. If this extension will be granted, so right now, the attention is going to probably shift from Beijing to Washington, especially today, to see if there's any resolution or if this tariff threat is uncertainty is going to hang into the weekend, MJ.

LEE: Yeah, we'll definitely see about that. Marc Stewart reporting from the Chinese capital. Thank you so much.

And Canada's Prime Minister Mark Carney says he is disappointed after the U.S. raised some tariffs on Canadian goods to 35 percent. The head of Canada's chamber of commerce released a statement saying, quote, more fact-less tariff turbulence does not advance North American economic security. Businesses in Canada and the U.S. urgently need certainty. Thursday's executive order also put up the tariff on goods from Taiwan to 20 percent, but the Taiwanese president says that's just provisional and could be lowered after further negotiations.

Pakistan's prime minister is thanking President Trump for slashing its tariffs on its goods from 29 percent to 19 percent. That is the lowest tariff applied to any South Asian country.

And let's bring in now, Jeanna Smialek, Brussel's bureau chief at "The New York Times".

Jeanna, it is great to talk to you this morning.

Many of our viewers will know you were until recently, also a longtime economics reporter. So, midnight five hours ago was when the steep tariffs had been expected to go into effect. But the new effective start time is now August 7th.

President Trump has, of course, long made clear that he wants to completely reshape and remake the global economy. No question that what we are seeing right now is precisely that.

JEANNA SMIALEK, BRUSSELS BUREAU CHIEF, NEW YORK TIMES: No, not really. I don't think you know, what were seeing is, you know, beyond just the sort of blanket tariff rates that have come out, what were seeing is that when the Americans are striking deals, they tend to be deals that very dramatically upend the trading relationship between the U.S. and the country in question.

I think the E.U. deal is a great example of that. It involved 15 percent across the board tariff rates, which is really considerably higher than the sort of single digits that used to exist there. And it involved a lot of sort of provisions on the E.U. side that hadn't previously existed, like zero percent tariffs for a bunch of U.S. industrial goods.

And so, I think we are seeing a remaking of the global trading system. And I think the question is, just how far does that run?

LEE: Yeah. And, you know, these tariffs are just going to be crippling for so many countries. Walk us through some of the countries that we will be hit with the highest new rates. And how do we expect those countries to absorb that kind of shock?

SMIALEK: Yeah. So, we're seeing a lot of really high rates across Asia. Some of the U.S.'s most important trading partners in Asia actually have managed to negotiate down their rates a bit. So, we saw Cambodia, Vietnam, Indonesia get down to the 19 to 20 percent range, which is less bad than we were previously expecting.

But then you're still seeing really high rates on places like Laos and Myanmar. Those are at 40 percent, 41 percent on Syria.

The reason that it's so interesting that these Asian countries are being hit with very high tariff rates is they are a big exporter of things like textiles into the United States. And then we're obviously seeing also closer to home, Canada facing that 35 percent rate, although that is, you know, subject to a lot of exemptions because we have the United States has a free trade agreement with Canada. And so, a little bit leaky that one.

LEE: Yeah. And I want to ask you about the domestic impact here in the U.S. as well. You know, this has been a really telling week for the U.S. economy with a bunch of critical data points coming out back- to-back. We'll see the jobs report in a few hours as well.

You know, the well, expectation is that with these kinds of huge tariffs, American consumers will really end up feeling the pain. But just how much pain are we talking about, do you think?

SMIALEK: I think it's an open question, because what we know from historical experience with tariffs is they tend to be almost fully passed along to the consumer. That's certainly what we saw during the Trump administration. So far, we have not seen a giant jump in inflation. But in that last consumer price index report, the most recent one we've received, we did begin to see a tick up. And it did come in categories that would respond to tariffs.

And so, I think we may be at sort of the bleeding edge of that, that movement. And so I think the question and the thing economists are really paying a lot of attention to is just how does this manifest for American shoppers, American consumers?

[05:10:08]

How quickly do companies put this in into prices? How much do they actually just take out of their bottom line? And so, I think those are a bunch of open questions, but we're going to find out within the next couple of months.

LEE: And, Jeanna, you just covered the U.S.-E.U. trade deal that was announced earlier this week. As we look ahead to other trade deals that could still come in the days ahead, I'm curious what stood out to you most about the U.S.-E.U. negotiations process? Are there any interesting lessons there for others looking to make a deal with the Trump administration?

SMIALEK: I think the most important lesson, and the one that we learned with places like Japan and Vietnam as well, is that when we say deal, deal is kind of the wrong word for this. These are more like blueprints. They are very sort of tentative. They are not set in stone, and they are not legally binding.

And so, I think that that has been very relevant in the instance of the European Union, in the sense that as a reporter, I still don't know some of the key details that are going to be in the final version of that.

You know, the E.U. is telling us one thing. The Americans are telling us something slightly different, and it seems like things may be changing a little bit under the surface. They're still clearly negotiations happening behind the scenes.

And so, I think it's really important to note that we are nowhere near the final chapter in this story.

LEE: Yeah. And clearly why there has been so much confusion across the board.

Jeanna Smialek in Brussels, thank you so much for joining us this morning.

SMIALEK: Thank you.

LEE: Donald Trump says he doesn't know why convicted sex offender Jeffrey Epstein poached staff from Trump's Mar-a-Lago spa. The president said earlier this week Epstein, quote, stole Virginia Giuffre from his Florida resort. Giuffre was one of Epstein's most prominent accusers. Her family says she was 16 years old when she worked at the Mar-a-Lago spa. (BEGIN VIDEO CLIP)

TRUMP: No, I don't know really why, but I said if he's taken anybody from Mar-a-Lago. He's hiring or whatever he's doing, I didn't like it. And we threw him out.

(END VIDEO CLIP)

LEE: Virginia Giuffre claims she was abused by Epstein and his confidante Ghislaine Maxwell, and then lent out to other influential men. Giuffre died by suicide earlier this year.

Her family spoke with CNN earlier about Trump's comments and how their sister wanted the Epstein files to be handled.

(BEGIN VIDEO CLIP)

SKY ROBERTS, VIRGINIA GIUFFRE'S BROTHER: It wasn't stolen. She was preyed upon at his property, at President Trump's property, and I think it's very important that we don't treat it -- like stolen seems very impersonal. It feels very much like an object.

And the survivors are not objects. Women are not objects. What goes through my mind is that it's time to protect survivors. And it's time to protect the young women and our future generation of young women.

So, no, she wasn't stolen. She was preyed upon. And it certainly makes you kind of ask the question. You know how much he knew.

AMANDA ROBERTS, SISTER-IN-LAW OF VIRGINIA GIUFFRE: She was still fighting for those documents to be released. They are sitting in our court system right now. She wanted the world to know what they've done to her and so many other survivors. And she had been fighting that to her very last day.

And I think we have taken that mantle on, and we will continue to fight with her and for her and for all the other survivors.

(END VIDEO CLIP)

LEE: The New York police officer who was killed, along with three others in Monday's mass shooting, was laid to rest on Thursday. Thousands of fellow officers attended the funeral to pay their final respects.

CNN's Omar Jimenez has more.

(BEGIN VIDEOTAPE)

OMAR JIMENEZ, CNN CORRESPONDENT (voice-over): It was a solemn day in the Bronx as fellow officers, friends and family gathered to honor fallen NYPD officer Didarul Islam, who was killed Monday in midtown Manhattan. Inside a crowded mosque, New York's Governor Kathy Hochul, Mayor Eric Adams, NYPD leaders and Islam's family spoke in his memory.

MAYOR ERIC ADAMS (D), NEW YORK CITY: I am responsible for the safety of New Yorkers. That is my obligation and that is my most basic function. And for someone to drive across our country carrying an automatic weapon and taking the lives of innocent people -- you ask yourself over and over again, what more could we have done? How could we have responded better? And you have a tendency to blame yourself.

And I just want to say sorry to this family.

JIMENEZ: Islam, an immigrant from Bangladesh who had served just three and a half years on the force, was remembered for his dedication.

[05:15:02]

DEPUTY INSPECTOR MOHAMMED ASHRAF, COMMANDING OFFICER, 47TH PRECINCT: Your journey started across oceans, but your purpose brought you here to these streets, to this city, to this part of the Bronx, to this shield and the NYPD 47th precinct, you made us all proud, you made a difference.

FATIMA BEGUM, SPEAKING ON BEHALF OF JAMILA AKAR, DETECTIVE ISLAM'S WIFE: Though my heart is broken, I find comfort knowing that his sacrifice may have saved others in that lobby, people who were able to go home to their families that day.

JIMENEZ: Officer Islam was just a few weeks away from welcoming his third child.

OFFICER KAMRUL HASAN, BROTHER-IN-LAW AND FELLOW NYPD OFFICER: He's not only my brother-in-law, he was my protector. He was my best friend.

Anything, everything, anybody need anything, he come to -- he come to us. He was helping everybody.

JIMENEZ: Even neighbors who didn't know Officer Islam personally wanted to pay their respects.

GULAN KHAN, FROM SAME TOWN IN BANGLADESH AS OFFICER ISLAM: He is from the same town that I grew up in Bangladesh. So we have sympathy for his family. So we want to attend the funeral.

JIMENEZ: Islam was working as a paid detail, but his death is being treated as a line of duty death, and he'll be posthumously promoted to detective.

Omar Jimenez, CNN, the Bronx, New York.

(END VIDEOTAPE)

LEE: Flash flooding in northeastern U.S. had some people stranded on top of their vehicles. A 13-year-old boy in Maryland died in the flooding. The heavy rains also caused flash floods in parts of New Jersey, New York, Pennsylvania, and Virginia. The flood risk will shift south in the coming hours into the Carolinas and parts of Georgia. Top U.S. diplomats are visiting Gaza today, touring aid distribution sites and talking with Palestinians. What we can expect from their mission just ahead.

Plus, Israel allows journalists from CNN, Portugal, into southern Gaza what they found waiting just across the border.

Also ahead, President Trump is sending his envoy to Russia as the clock ticks on possible new sanctions against Moscow.

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[05:21:31]

LEE: The U.S. is making a diplomatic push to try to end the hunger crisis in Gaza. Special envoy Steve Witkoff is visiting the territory today to get a firsthand look at an aid distribution site in Rafah. Witkoff met on Thursday with Israeli Prime Minister Benjamin Netanyahu in Jerusalem. Hostage and ceasefire talks have stalled with the U.S. and Israel blaming Hamas for negotiating in bad faith. Hamas says it is committed to peace talks and will rejoin the process once the humanitarian crisis in Gaza ends.

The U.N. aid chief says bureaucratic hurdles are keeping food and other supplies from getting to the people who need them most. Israeli authorities allowed a crew from CNN, Portugal, into southern Gaza on Thursday. They reported seeing the equivalent of 800 trucks worth of aid waiting to be distributed.

More now from CNN's Jeremy Diamond.

(BEGIN VIDEOTAPE)

JEREMY DIAMOND, CNN JERUSALEM CORRESPONDENT: Well, the U.S. special Envoy Steve Witkoff was dispatched to Israel by President Trump to address the dire humanitarian crisis now unfolding in the Gaza Strip, a crisis very much born out of Israeli policies, Israeli restrictions on aid distribution in Gaza over the last several months.

Witkoff had what the White House described as a, quote, very productive meeting with the Israeli Prime Minister Benjamin Netanyahu to talk about improving aid distribution in Gaza. And we expect that Steve Witkoff will indeed travel into Gaza with Israeli officials to see one of those Gaza Humanitarian Foundation sites, examine these aid distribution efforts firsthand.

And he is also, according to the White House, expected to speak with Palestinians on the ground. It's not clear who those will be, but they were described as local Gazans by the White House.

Also, no indication as of yet that Witkoff plans to meet with U.N. officials who are also ramping up aid distribution in Gaza. It seems very much like the United States is favoring this distribution model of the American run Gaza Humanitarian Foundation, which is hugely controversial, in particular because hundreds of Palestinians have been shot and killed by Israeli forces as they have made their way to these distribution sites, according to eyewitnesses and the Palestinian Ministry of Health.

This week we have seen an uptick in the number of aid trucks that are getting distributed in Gaza, about 200 trucks every single day over the course of the last three days. But that is still well short of the 500 to 600 trucks of aid per day that U.N. officials say are needed to even begin to alleviate the starvation crisis that is now also being described as a famine inside the Gaza Strip.

And I want to show you a video that kind of underlines some of the challenges of aid distribution in Gaza. This video is filmed by the UN's Office of the Humanitarian Coordinator. And you can see this huge crowd of Palestinians that gathered after this U.N. convoy was held up at an Israeli checkpoint for two and a half hours. And then this happens.

UNIDENTIFIED FEMALE: It's kids. It's children. Children, stay there.

UNIDENTIFIED MALE: Don't do this. Don't do this.

DIAMOND: Now the U.N. official in that vehicle says those were Israeli warning shots being fired just inches away from those Palestinians who were gathered at that U.N. convoy.

[05:25:07]

The Israeli military, for its part, has denied that. But of course, these instances are continuing because there simply is not enough food in the Gaza Strip right now to address the enormous needs of the population.

What would of course address everything is if there were to be a ceasefire between Israel and Hamas. But that appears now further than it ever has been. I'm told by two sources familiar with the matter that Hamas has stopped engaging in any discussions regarding ceasefire and hostage release negotiations. This comes a week after Israel and the United States walked away from the Qatari capital, pulled their delegations.

And now amid the humanitarian crisis in Gaza, Hamas spokesman Basem Naim saying that improving humanitarian conditions in Gaza is now a condition for Hamas to get back to the negotiating table.

Jeremy Diamond, CNN, Tel Aviv.

(END VIDEOTAPE)

LEE: Russia and Ukraine are waging a war of words as they battle for a key town in the east. The big question is who is still holding it? That story and much more straight ahead.

And later, Texas lawmakers and residents are blasting local officials for how they handled last month's deadly flooding.

Stay with us.

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