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But Doesn't Mention Canada, After Top Advisor Said Both Would "Likely" be Delayed; Trump Says He's Suspending Most New Tariffs on Mexico; Congressional Approval Needed to Officially Shut Any Government Agency; Trump Preparing to Sign Dismantle Education Department. Aired 12-12:30p ET

Aired March 06, 2025 - 12:00   ET

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

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DANA BASH, CNN HOST, INSIDE POLITICS: Welcome to "Inside Politics". I'm Dana Bash, and we have breaking news. And that breaking news is that there is a roller coaster happening with regard to the tariffs, those 25 percent tariffs that the president slapped on Canada and Mexico on Monday.

Well, those are apparently not happening, at least when it comes to Canada, and, excuse me, to Mexico and not Canada. He is reversing some of them, at least, maybe. Frankly, the reason why it's hard for us to describe is because nobody knows what exactly is happening.

The president's commerce secretary said this morning that he was likely to postpone them for at least a month, but then minutes ago, President Trump said that they are going to delay those tariffs for Mexico, but not Canada.

Washington, Wall Street and Main Street have a lot riding on this. Everybody is extremely confused. Maybe Jeff Zeleny is not one of those people. Jeff, you're standing outside the White House. You're on the North Lawn. Can you give us any sense of what all this means?

JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: Dana, if there's any question of why the market has been so confused and rattled in recent days, I think the events of the last really hour, sum it up quite perfectly. And certainly, of the last month, the president often threatens tariffs. This time, he went through with tariffs, and now we are learning that he is pulling back those tariffs.

Let's start with Mexico. President Trump this morning, had a call with Mexican President Claudia Sheinbaum, he reported out a little bit of what they said. And in that he said he is lifting the Mexico tariffs for at least a month. Let's take a look at his rationale as he explained it on social media.

He said, I did this as an accommodation and out of respect for President Sheinbaum. Our relationship has been a very good one, and we are working hard together. He goes on to say to stop undocumented immigrants and fentanyl. Then he also is using this to contrast his conversation yesterday with Canadian Prime Minister Justin Trudeau.

So, he has not yet said that he is going to lift the tariffs on Canada, but that is coming, and we learned that today from Commerce Secretary Howard Lutnick.

(BEGIN VIDEO CLIP)

HOWARD LUTNICK, U.S. COMMERCE SECRETARY: My expectation is the president will come to the agreement today, and hopefully we will announce this today, that USMCA compliant goods will not have a tariff for the next month until April 2nd. Hopefully Mexico and Canada will have done a good enough job on fentanyl that this part of the conversation will be off the table and will move just to the reciprocal tariff conversation.

(END VIDEO CLIP)

ZELENY: So, look, yesterday, President Trump and the White House was saying that Canada had not done enough on fentanyl. Today, the Commerce Secretary says Canada has done enough. That underscores one reality, that fentanyl is not the -- it may be the stated reason, but it's not the actual reason that the tariffs have been put in place because very little fentanyl comes from Canada.

From Mexico however, it does. So, Dana, the bottom line to all of this is we have seen the president. He's a believer in tariffs. There's no doubt about it, but when he starts hearing the pushback and seeing the pushback in the markets, he reacts and changes his mind.

We're told he will be speaking on this later this afternoon, and they're also the White House is also saying that the reciprocal tariffs, the bigger batch, if you will, is still going into effect on April 2nd. But I think now every time we talk about the threat of tariffs, we have to keep in mind sometimes he gives them and sometimes he takes them away, Dana.

BASH: Or maybe he won't take them away. We still are not clear, beyond what he posted about Mexico, what that means for Canada and beyond. Jeff, thank you so much. The uncertainty is not confined to Pennsylvania Avenue business leaders from Wall Street to Main Street are definitely feeling it too.

I want to go right now to Matt Egan, who has been talking to those business owners. And Matt It is not a coincidence that Howard Lutnick went on a business network to say these are perhaps not going to happen now. A business network that everybody who is on Wall Street watches.

It seems to me that what he was trying to do was to correct, help correct the markets which are totally confused and worried. And we all know that confusion is not a place at the market wants to be. And we also know that the markets are an indicator of an economy that President Trump has historically been very, very keen to watch.

[12:05:00] MATT EGAN, CNN REPORTER: Yeah, that's right, Dana. Look, business owners, CEOs, investors, they crave stability, but what we're getting right now is a whole lot of uncertainty and, frankly, chaos, right? It feels like each week, or maybe even each hour, there's new tariffs that are threatened, right?

Some of them kick in. Some of them are pulled back at the last moment, after a very good phone call between President Trump and a world leader, others are still looming. Look at this tariff time line. This is just tariffs related to Mexico, Canada and China, and just since late November, there's been so many major moves.

This doesn't even account for the tariffs that have been threatened on steel or aluminum or copper, or the reciprocal tariffs, or the tariffs on nations that threaten the U.S. dollar. I mean, we literally could not fit all of the major tariff actions on one full screen.

And look, if you're a CEO, if you're a business owner, this is not what you want to see, right? They famously hate uncertainty, but it's hard to imagine a more uncertain environment than this, because think about a lot of them are trying to figure out the cost of their goods, but they don't know what the cost of their goods is going to be, because they don't know where tariffs are going to be.

So, they don't know if they should be raising prices or lowering them. Should they be firing workers or hiring them? Should they be investing more or less? There's actually an uncertainty index when it comes to trade policy, and it is through the roof. It has skyrocketed to all- time highs surpassing anything that we've seen going back to 1960 including even higher than during President Trump's first term.

BASH: Wow.

EGAN: And that makes sense, because what he's doing is just so much more aggressive in terms of size and scope than during his first term. I talked to a business owner in California who owns a pet supply store, and he said, look, he's not a fan of the tariffs, but it's the uncertainty that's even worse.

He said, it's just very stressful right now because he's trying to follow it all, but he just can't keep up. And I would just note that from the White House's perspective, I do think an element of this trade volatility is probably a feature. It's not a bug, right? The president used tariffs as a way to gain leverage over other nations.

And so, by keeping everyone guessing, it enables the president to put even more pressure. But look, Dana, we are seeing this show up in the real economy, and it is really starting to pressure things.

BASH: Yeah. And as you were talking, we just got an update on where the DOW is Matt, down 500 points. And so, this is clearly what Howard Lutnick was trying to arrest that drop. Thank you so much for that. And we should also note that we're going to be talking tomorrow, no doubt, because tomorrow the jobs report will come out, and we already got an early indicator that it is not likely to be very good. I do now want to talk to some other terrific reporters that we have

assembled today. Peter Hamby of Puck, Jeff Mason of Reuters, Mariana Sotomayor of "The Washington Post", thank you all for being here. Jeff Mason, I want to start with you. You have covered the White House for a few years on all kinds of policy, especially and including economic policy, and you recovering it during the first Trump go around.

So, I think what Matt said about this being part of the strategy, not a bug but, but this is kind of the way that the president likes to put his tariff policy out there. Is true, but because there is so much and it's already on top of a crisis of affordability in the United States, this feels different right now.

JEFF MASON, WHITE HOUSE CORRESPONDENT, REUTERS: Yeah, I think that's a great point. And I would piggyback on to something that Matt said, that in addition to the volatility in the markets, which average Americans will note in their 401-Ks and investment accounts, but it goes a lot further than that for businesses, as Matt was saying, to plan for your goods, to plan for what products need to be purchased, for what supplies need to be purchased, for where you want to keep your factory, for where you want to have your headquarters.

All of those things factor into business decisions that are affected by this volatility, and the volatility is so massive because the president keeps changing his mind back and forth. I suggest -- I suspect rather, that that's one of the reasons that the DOW is going down again today.

I mean enlarged and partially, you would that it would go up because he's giving another reprieve. And all of the other reprieves that he's granted have been positive in the markets. This one isn't being seen that way, and I suspect if he spoke to analysts or traders that it was -- it's the erratic nature of his decision making that is affecting that.

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BASH: Yeah, and Peter Hamby, the erratic nature of Donald Trump's decision maker making process is his calling card. But on this issue, it is something that is definitely like in the short term, hurting. I mean, there's no way around it. If you look at the DOW again, it's not only down today. It is down since he was elected to the White House, elected on a promise to make the economy better.

PETER HAMBY, FOUNDING PARTNER, PUCK NEWS: Yeah, absolutely. And you know, sometimes if you look under the hood in polling Dana, you get these leading indicators of general, you know, approval disapproval. Only 31 percent of Americans in a re poll that came out just a couple days ago think that Trump is doing enough to handle the cost of living or approve of his handling of the cost of living.

By the way, only 62 percent of Republicans approve of how he's handling the cost of living in that poll, that's not a good number among Republicans. His numbers are down from even just a couple weeks ago on his handling of the economy. I wrote a piece the other day about young voters. Remember, he won

young men for the first time in decades in the 2024 election, and I'm citing social sphere, but he's -- he found that his support on the economy has dropped 14 points in just between January and February among young men.

At the same time, I have noted this interesting dynamic going on. His job approval rating Trumps is ticking down by a couple points. His personal favorability rating has actually kind of gone up a little bit since the inauguration. And so, I think that what that means is a lot of voters out there might still be giving him, not a lot might still be giving him some good will.

Things will get better, but in time, once you drill down on specific questions, Ukraine, economy, tariffs, or whatever, not doing so well. And as Jeff mentioned, you know, I think only 60 percent of Americans actually own stocks. Most people are going to start to feel this. Target, Walmart, at Best Buy, at Chipotle -- you know, at the gas station, perhaps at the grocery store, and they're currently feeling it. And consumer confidence -

BASH: Yes.

HAMBY: -- has gone down for the first time since last year.

BASH: Yes, and that's an important point. Wall Street is not Main Street, but they are very much connected, particularly when it comes to what appears to be the reason for this drop, which is the very chaotic and confused decision-making process inside the White House, it seems, by the president himself, when it comes to these tariffs, which are as close to his heart as any policy is.

And Marianna on that I feel like, as Peter was talking, I feel like we're in that moment that in a few days, or maybe even when we see the books written about the first 100 days, whatever is happening right now inside the White House, and the scramble that I am sure is going on as we speak is going to be quite dramatic.

MARIANNA SOTOMAYOR, CONGRESSIONAL REPORTER, THE WASHINGTON POST: Absolutely. And you know, I'm personally curious covering Congress, are members of Congress, Republicans in particular, calling the White House? Have they been calling the White House even earlier this week, once those tariffs really went in place, and saying, hey, this is not good for the long term.

I privately heard from a number of House Republicans who are really hoping that the tariffs would only last about a week, because they knew if they continued any longer, especially a month, that would be devastating for their communities.

Republicans, of course, thinking not just of their constituents, small business owners, how it's going to affect auto workers, et cetera. But there's also a little political consequence for them. Mid-terms are coming up next year, still far away, but it's still very front of mind on Capitol Hill about this back-and-forth decision making by Trump and them not necessarily being in the loop and being able to advise on all of these decisions.

BASH: Yeah, I think as you started that you talked about whether members of Congress are calling the White House, the answer to that is yes, they are, the fellow Republicans. All right, everybody stand by coming up, President Trump wants to abolish the Education Department, what does that mean for the kids in the classroom? We're going to have new details next.

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BASH: President Trump is preparing to dismantle the Education Department. Sources say he could decide this week to take the first steps to eliminate the department. But the White House Press Secretary just revealed the President is not signing an executive order today.

And of course, you can't eliminate an agency you're not supposed to anyway without the approval of Congress. So, what does this mean for the students in your life? CNN's Tom Forman is digging into it. So, Tom, let's start with the basics. What exactly does the Department of Education do because it's not exactly what some people might assume?

TOM FOREMAN, CNN CORRESPONDENT: It is not at all what many people assume. Dana, it administers federal funding to K through 12 schools. Important to note that is about 8 percent of all that funding, all the funding you're getting in your state, most of it is state and local. Only about 8 percent is from federal. Federal and that's not all from Department of Education that includes other federal departments. That's the total amount.

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It also manages federal student loan program, people going off to college, that sort of thing. It oversees federal financial aid programs. It is also involved in investigating discrimination complaints, and it conducts research on nationwide reading and math skills. You may recall seeing the national report card every now and then that explains how kids are doing here, whether they're doing well or not.

What it doesn't do is also important. It doesn't set K through 12 curriculums. It doesn't tell schools what to teach. It does not certify teachers, and it does not establish graduation requirements. So, if you have complaints about this, anywhere where you are, that is going to rest largely in your local community and your state, not at the federal government.

Through all of this, if you want to look at the actual money involved, the K through 12 moneys, most of it 28 billion, goes to Title One to help low-income students and to the idea program to help students with disabilities, Dana.

BASH: And you know, we have probably both been around long enough to know that Republicans, I guess, maybe since Newt Gingrich, they have been saying the Department of Education must be dismantled. So, this part of the Trump agenda maybe isn't that much of a surprise.

But in addition to laying out, if you did so well what the DOE does and does not do. One of the questions is about the money that it has. So, what is our understanding of what happens if he is successful in dismantling the Department of Education? What would happen to that federal funding?

FOREMAN: That's the tricky part. You're exactly right ever since Jimmy Carter created this in 1979 and there were earlier iterations of as well. Republicans have said they want to get rid of it. This number right here, the Congressional Budget Office took a look at this, and they said, if you want to go after that money, you have to attack those programs, which means you're going to have to take money from the students of working-class families all across this country.

That's the only way you get at that money. Getting rid of the department the CVO said doesn't really do much to just to reduce the spending.

BASH: Really interesting, really important point. Tom, thank you so much for that. My panel is back. And Marianna, I want to start with you and just look more broadly at what the president has already done with his pen, his executive actions with regard to federal education.

Teaching that there are only two sexes, banning transgender women in sports, promoting, quote, patriotic education. Not really sure what that is, banning DEI and woke curricula, eliminating COVID vaccine mandates. So those are the kinds of things that an executive branch can do, or this president is trying to test whether he can do with or without the Department of Education.

SOTOMAYOR: Yeah, a lot of those also fall into the culture war category. Things that Trump and also other Republicans, when they were campaigning, promise that -- you know, he would, he would do that. They stand behind the question about executive orders and kind of taking away the power from Congress is something that -- you know, we're all kind of exploring.

But it's been interesting to see that so far, Congressional Republicans, for the most part, aren't necessarily stopping Trump from dismantling different agencies.

BASH: Not at all.

SOTOMAYOR: We've recently heard from Senator -- exactly Senator Susan Collins, the only one who's really been pointing out today on the Hill that Trump can't just dismantle the Education Department. Congress needs to do that.

And the thing that Republicans need to worry about is Democrats are already messaging hard against them on the prospects of this, saying, you know, why isn't Speaker Mike Johnson, who is a constitutional lawyer, not speaking out about the constitutionality of this and kind of daring Republicans.

Jeffrey said earlier today, listen, if you want to bring legislation to dismantle the Education Department, bring it on. We'll point out all of the different consequences that could come from that.

BASH: And Peter Hamby, you have been doing some focus groups with swing voters on the broader beyond the Department of Education, the broader DOGE cuts. And I want to read a little bit of what you found, which you published.

Polls for instance, don't tell you that Musk is a weird nerd, which is how Adam, a Trump voting hockey fan from Macomb County, described the billionaire last week, or that he's a quote complete tool, as Michael from Milwaukee, put it or scary as Taisha from Toledo or selfish. DeAndre, also from Milwaukee.

And just looking to enrich himself, perhaps Eric, a real estate appraiser from Pittsburgh, put it most poignantly, extremely radical, scary, a just shudder that Trump has given him. Car launch, Peter?

HAMBY: Yeah, these are focus groups conducted in Macomb County, right outside of Detroit.

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You know your typical sort of Reagan Democrats by a Joe Biden, Kamala Harris, Super PAC, unite the country. But these were swing voters. These were Biden to Trump voters specifically. And as I mentioned in the earlier segment, even if people had economic concerns the cost of living, they were still giving Donald Trump a little bit of the benefit of the doubt.

There were some exceptions, including on tariffs, but Elon Musk, and this has shown up in lots of polling beyond focus groups, was just sort of like, as you mentioned, dismissed as kind of an odd guy out to enrich himself, the unelected billionaire messaging that Democrats have been pushing felt like he was cutting through to these voters at the same time, you know, and I think Democrats are grappling with this right now.

Do Democrats want to be standing in the way of defending like the IRS federal bureaucracy? You know they have to pick their battles. I think education is a good one for them to sort of die on the Hill. But Elon Musk as an avatar of DOGE in these focus groups, came off as pretty unpopular.

But the idea of cutting government spending and reducing the size of the federal government was more popular. And again, that shows up in polls. So, it depends how these cuts are message. And one more note, I'll add on the Education Department. You know where I am in California, there are 5.8 million public school students.

That's more than the total population of most states, Minnesota, Kentucky, Alabama, whatever. And so, as with a lot of these government cuts and these bureaucratic stories, there's not a lot of pictures attached to them. They're hard to explain.

If we start to see some long tail outcomes where students and parents are affected, and see those pictures and those clips on television and social media that could be impactful. Remember, school boards became a battlefield over the last four or five years, critical race theory, whatever the fight was, and that was really resonant, especially in places like Virginia, where there's an election this year.

BASH: And real quick Jeff, what are you hearing from your sources at the White House about the sort of pressure at all, if there is any on Elon Musk to use more of a scalpel than a than a hatchet.

MASON: You know, Reuters reported, I think, last week, that there was a little bit of tension in the White House with Elon Musk about what he's doing, mostly, though, because he hadn't been coordinating. I haven't heard that. There's a concern that he's doing too much, and certainly the very robust support that he's received from the President of the United States, when asked about this, would suggest and underline that.

BASH: OK, thanks to you all. Don't go far, though, because coming up DOGE the math, I'm going to talk to a member of the House Republican leadership about her meeting with Elon Musk and how the unelected government cost cutter is explaining to them potentially billion dollars in mistakes.

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