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Conservative Justices Appear Sympathetic Toward State Law Banning Trans Athletes From Female Sports Teams; New Report Shows Inflation Steady At 2.7 Percent In December; Trump Administration Ramps Up Proposals On Affordability; Trump Expected To Meet With National Security Team On Iran Options. Aired 12-12:30p ET

Aired January 13, 2026 - 12:00   ET

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

[12:00:00]

DANA BASH, CNN HOST, INSIDE POLITICS: Supreme flash point. The highest court in the land is tackling one of the most contentious issues in American culture.

I'm Dana Bash. Let's go behind the headlines at Inside Politics.

You are looking at live pictures of the Supreme Court, where, as we speak, justices are hearing arguments in two cases that could determine whether state -- states could ban transgender athletes from playing in women's and girls' sports. Now this is an issue that, of course, has ignited political debate and a firestorm across the country, even though transgender people, particularly young people, make up approximately 1 percent of the population.

I'm joined here by a terrific group of reporters, and also with me is our legal analyst, Elliot Williams. So, what are we seeing and hearing so far in these arguments, which started about two hours ago?

ELLIOT WILLIAMS, CNN LEGAL ANALYST: Right. They're lengthy arguments, because you're talking about two different cases here, one from out west, in Idaho, one in West Virginia. Now, I think the open question is, where ultimately do Brett Kavanaugh and Neil Gorsuch end up, regardless of whatever opinion ends up being written by the court here. The two of them are going to be in the majority of it. I don't like empty prognostication, but it's clear that those votes will decide the day here.

Now, there are enough before you even get to the specific question of, what does America think of transgender people or transgender girls in sports? There are big questions of, how does the court look at the case? Do they defer to lower court decisions that struck down state laws, or do they view them with some skepticism?

There was this language of that came up a bunch today called intermediate scrutiny. Don't worry about the specifics of the term. But really what it means is, how much do they rely on the lower court decision and what happened before? Also, this idea of both the language of Title IX, which bars discrimination on the base on the basis of sex, is the language in education and the language of the 14th Amendment of the constitution equal protection. How do you apply those things to a class of individuals that one side says, no, this you are talking about sex here. You are talking precisely about what the law says, and another side that says and sort of blessed by Jon Roberts. Well, no, not quite. You're talking about an exception from sex. And it's just complex, heady legal stuff before you even get to any of the big, broader moral and political questions of what, you know, how does this country treat transgender people?

BASH: But what you just said, the big, broader moral cultural questions are directly related to or maybe are -- we're trying to fit that into the legal question, which is, you know, I don't know, round, round peg, square hole --

WILLIAMS: Round statute and the square law.

(CROSSTALK)

WILLIAMS: The square constitutional provision. But no, absolutely. And we'd be kidding ourselves if we didn't think that some of these zone justices moral frameworks were not driving how they approach any of these things. What also makes it complicated is that the court has considered questions of the rights of transgender people twice in recent years. Once saying that yes, discrimination on the basis of one's transgender -- gender identity does violate Title VII, the law governing employment.

But then another recent decision since that that sort of blocking the application or administration of hormones to children. So, it's a little bit of a jumble how the court is going to look at it and how these particular justice are going to look at it --

BASH: Yeah. And they've allowed a military since President Trump has taken office again, a military ban on transgender service members. In the military, they allowed that to stand. And as you -- I think, alluded to the question of transgender care. Just in June, it was a six three decision that let stand a Tennessee law banning transgender care for minors.

You mentioned the two justices that you are going to be looking at. Well, let's listen to what Brett Kavanaugh said in one of his questions this morning.

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(BEGIN VIDEO CLIP)

BRETT KAVANAUGH (VOICEOVER), JUSTICE, THE SUPREME COURT: For the individual girl who does not make the team or doesn't get on the stand for the metal or doesn't make all league, there's a harm there, and I think we can't sweep that aside.

(END VIDEO CLIP)

BASH: I'm going to open it up to everybody else, but real quick, Elliot, talk about, I mean, I think on its face, it's pretty clear what it means, but from a Supreme Court perspective. WILLIAMS: Absolutely. And both Justice Roberts and Justice Kavanaugh really got to this idea of this concept of exceptions one justice, or at least one back and forth earlier was, what about a boy or a man with low testosterone who could purport to be eligible for women's sports but didn't identify as a transgender female? How do you treat that person? And they are sort of as a way of showing their skepticism, saying that, look, this is not as cut and dry as we think it is. And I think that's signaling how they're going to rule it.

BASH: Which is not that hypothetical, is actually not so hypothetical, because that is one of the arguments in one of the two cases that they're hearing, is that this person who was born a boy and became a woman, did a girl did so before puberty? These are all very complicated questions that these, you know, people on the Supreme Court are trying to decide.

Seung Min, you have done a lot of reporting on this issue as it relates to what the White House has been trying to do sort of writ large. Just one headline for one of your stories about federal employees who have filed a complaint against the Trump administration's ban on gender affirming care.

SEUNG MIN KIM, WHITE HOUSE REPORTER, AP: Right. Obviously, these cases at the Supreme Court have been going through the legal system for some time. But we can't separate it from the context that we're seeing from this administration, which is a series of actions from the White House and from throughout the administration that really targets the transgender community, which, as you point out, is a very small sector of the population.

There was a major HHS decision last month where it talked about potentially cutting off all Medicaid and Medicare dollars to any hospital that provides gender affirming care. That is a pretty large chunk of money that will be erased from these hospitals' budgets. Should this -- should this regulation become finalized?

In a smaller scale sense, there are federal employees who are now taking legal action against this administration because their federal healthcare coverage, now no longer covers gender affirming care. And there are, you know, there's direct testimony from federal employees, whose families or who themselves are directly affected by this. So, it's really -- you kind of have to look at it in the broader context of everything that is going on with the trans community right now.

BASH: And Aaron, presumably, what is decided in these two cases will have an effect on what is happening in states across the country. And let's just kind of take a bird's eye view of what is happening in states across the country. If you see right now, the states in red, those are the states that have a ban on transgender student athletes in sports, and the yellow do not, not surprisingly, except for Colorado and New Mexico. The difference is between the coasts, which tend to have more liberal points of view, and the middle of the country, which have different cultural ideals.

AARON BLAKE, CNN SENIOR POLITICAL REPORTER: Yeah. I think this is really -- these cases come at a pivot point for us because after the 2024 election, you saw the Democrat Party, especially kind of walk away from these issues, believing that these issues have kind of lost, and I don't think necessarily that Democrats are going to come back and really strongly support the idea of, you know, taking away these bans. This is not the issue that the Democratic Party is focused on right now.

But we also do see the Democratic Party starting to get its feet a little bit more. They're starting to feel a little bit stronger about their prospects in the mid-term elections. And you have to wonder, at some point, given how much certain members of the party feel strongly about this issue, about protecting transgender individuals, are they going to start to kind of warm to this issue again and try to fight these battles that they walked away from over the past year?

BASH: Well, it's interesting. Elizabeth Warren was on the show yesterday, and she laid out a roadmap for Democrats on the economy for this election year and beyond. And I asked her, what about those social issues? She's just focused on the economy, in her answer with two follow ups. I want to bring you in, but I do want to listen to Sonia Sotomayor to get a sense of what the more liberal justices are saying and asking.

(BEGIN VIDEO CLIP)

SONIA SOTOMAYOR (VOICEOVER), JUSTICE, THE SUPREME COURT: You're asking the court to adopt views expressed by two minority dissenting judges in this case. We've been doing an awful lot of that lately, but you're smiling because it's true. But you're asking us to adopt an approach that we have rejected as a majority court and accept what dissenters are doing.

[12:10:00]

(END VIDEO CLIP)

AYESHA RASCOE, NPR HOST, "WEEKEND EDITION SUNDAY" AND "UP FIRST": Yeah. Well, the court has changed a lot, you know, since some of these cases, and so -- and the country has changed a lot, and that's why you see Democrats who were, you know, out front on transgender issues. Now, as you say, saying look, we want to focus on the economy. I think it is -- this is a nuanced issue, and especially, when you start talking about sports and stuff. And the problem is, politics doesn't do nuance. And so that's a really difficult thing.

But I do think when you start going beyond sports and basically start saying, even adults cannot get gender affirming care, they cannot live the lives that they want to live. I think that is something where you may see Democrats talk about a little bit more. But, yeah, they're going to be wanting to talk about pocketbook issues and not about transgender issues.

BASH: Real quick.

WILLIAMS: No. The last thing I would say is, what's really interesting is that I believe it was the Solicitor General of Idaho, the top lawyer there at the argument this morning, did acknowledge discrimination against transgender children. But the point is, does that qualify as sex under the law?

And I think this at least per this individual's argument, no, but still did acknowledge and this is the broader context point that Seung Min was making. But of course, this is a discriminated against segment of the population. Now, to what extent the Supreme Court will apply the protections of the law to them, remains to be said.

BASH: Really, really fascinating and very consequential. All right, coming up. President Trump says affordability is a hoax, but now he's rolling out some new ideas to address it. And later, no show. Why Bill Clinton skipped Capitol Hill today, and why Republicans say they may hold him in contempt of Congress.

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[12:15:00]

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BASH: President Trump's focus lately has been overseas in a big way, but today he is in Michigan. In fact, he just landed, and he's there to talk up an economy that many Americans say isn't working for them. Here's what he said -- the president said, on his way out.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF UNITED STATES OF AMERICA: We're going to Detroit. We'll be talking about how well the economy is doing. We have tremendous growth numbers, so growth is going up. So, I'll be talking about that today in Detroit. It's big speech, and I can only say that the country is doing well.

(END VIDEO CLIP)

BASH: Now President Trump's sales pitch comes as a new inflation report out this morning showed that the inflation rate ended the year in 2025, 2.7 percent. Now that is just a fraction down since the president took office in January, and still above the Fed's inflation target of 2 percent. The White House claims it shows, quote, President Trump has defeated the inflation crisis inherited from the Biden administration.

My smart reporters are back. Now, listen, this is an important trip that he's making, and it will be an important speech. He's done one in recent months, I guess, specifically, that was advertised as talking about affordability, and he went very much off base, I think it was in Pennsylvania. So, let's see if he -- if he stays focused on this today.

BLAKE: Yeah. I mean, that that speech that we saw back then was very much -- I mean, he basically said, at one point, like, I'm not really interested in talking about this. You know, they want me to talk about this stuff, but I'm not really that interested in it. And that comes through in his broader approach to pretty much everything.

We see him making these big moves on the world stage. We see him continuing to do things like, you know, we have the Justice Department against his political foes. It just seems to be something that it's not at the top of his list right now, but it's obviously his biggest political issue right now.

BASH: It's on the top of voters list.

BLAKE: It's very much on the top of voters list. And the other problem is, you know, you played that -- that, quote, that Trump just made about how this is the Biden economy and that things are great. Well, those are not the things that the American people believe. And so, he's been saying these things for a number of months, and he hasn't convinced the American people to be on the same page as him. So, it's going to be interesting to see whether he continues in that vein, because it seemed for a while like the people around him really didn't seem to be comfortable with that.

BASH: So, we have kind of stagflation right now. But one of the things that sort of real humans who go to the store understand is that prices do feel higher, and there's a reason for that. Cumulatively, since COVID, food prices are 25 percent higher than they were.

RASCOE: Yeah, and I mean, you can't get around that. I mean -- I think the problem for the Trump administration is that President Trump doesn't like to say that things aren't going well under him, right? Like, he doesn't like to say there's a problem, because he's the fixer. And in the first administration, it was fine, because he could say we had the best economy ever done. And it was true. He had numbers to back it up.

But when you say that now, it just does not ring true to people. When they are going to the grocery store, they know the prices are up. And you can't just, you know, we saw during the Biden administration, they would go out on the road. It didn't really work that well for them to try to sell this economy like, people want to see a difference. But it's very hard for a president to do that.

BASH: There are proposals that the administration has put out, and I'll just put some of them up on the screen, banning large investors from buying single family homes, capping credit card rates. Make tech companies pay their own way on utilities. Use Fannie and Freddie to buy $200 billion in mortgage bonds, and then, of course, he's trying to drive oil prices down by ramping up Venezuela's oil production. That is very much a long-term project.

[12:20:00]

KIM: Right. Obviously, as it relates to Venezuela, in addition to capturing Maduro, they really frame this as an economic issue looking at the oil that we could provide. But it seems to me, over the last several days. When the president has thrown out the so-called affordability measures, it's kind of been a little bit, you know, piecemeal and hasn't really explained all the -- all the legal mechanisms or the plan or the strategy to make this, you know, government of effect.

You mentioned the capping the credit card interest rates. It's -- there is legislation that's being worked on. There's actually legislation that already exists, but he doesn't really -- he doesn't have buy in from Republicans on this proposal. Speaker Mike Johnson actually was very critical of these policies this morning, which you don't hear from the speaker very often, and you don't have support, obviously, from Wall Street for these measures.

But it's not like he's getting credit from Democrats either on adapting more of their populous proposals. You know, they'll like the policy measures. But if you talk to people like Elizabeth Warren or Bernie Sanders, they will note that, look, this is a -- this is a president that endorses de regulation. He gutted the Consumer Financial Protection Bureau, so he's not getting actual support buy in for a lot of these ideas from the people who can really help promote these policies.

BASH: I'm so glad you brought that up. First of all, it was really interesting that the House Speaker threw cold water on a proposal that the President has out there to cap credit card rates, because you don't see him do that that often. On the Elizabeth Warren question she was here yesterday, as I mentioned. The president called her. Let's just -- I mean, even just that Senate Elizabeth Warren to talk about a policy issue, and that is the credit card rate cap. Listen to what she said last night about that phone call.

(BEGIN VIDEO CLIP)

SEN. ELIZABETH WARREN (D-MA): Donald Trump says he wants to do a cap on interest rates on credit cards. I've been arguing for that -- for years. Then fine. Let's get it done. He says he wants lower housing costs. Democrats are ready to go, but not the Republicans in the House, and Donald Trump hasn't lifted a finger to help move that forward.

(END VIDEO CLIP)

BLAKE: I would submit that Senator Elizabeth Warren going on TV and talking about how this has been her idea for the last 10 years is probably not going to win over Republicans. And I also -- I'm glad that Seung Min brought up the Mike Johnson's response on this, because it was so telling. It was like, you know, Donald Trump is an ideas guy, basically suggesting that Trump is just throwing some things out there, seeing what sticks.

But this issue in particular, to the extent Trump really goes for this credit card caps thing is the kind of issue that can really split the Republican Party in a lot of different ways, because there is some of that old guard, that old guard fiscal conservative ism that still exists there. And this idea is anathema to everything that they believe about fiscal policy.

And so, this is kind of -- this gets at some of the problems with Trump addressing the affordability issues. A lot of the things he reaches for tend to be in this vein. They tend to be big government solutions that are really taking control of the of the free markets. And that's not something that a lot of the party is very comfortable with. BASH: It's so complicated. Up is down, left is right. It's really remarkable. Ok, up next. President Trump tells Iran Ian protesters that help is on the way. So, has he made a decision on what he's going to do next? Stay with us all.

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[12:25:00]

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BASH: Here is a quote from President Trump, keep protesting, take over your institutions. President Trump put that message out on social media, and it was directed to the Iranian government protesters. The president has been weighing a variety of options, including military intervention as he increases pressure, just like that. Post on the Iranian regime, a human rights group says hundreds of people have been killed in the regime's crackdown.

I want to get straight to the White House. CNN's Alayna Treene is there. Alayna, you've been doing a lot of reporting on what's going on in that building behind you on what the president is weighing.

ALAYNA TREENE, CNN WHITE HOUSE CORRESPONDENT: Yeah. And what I found really interesting about this post as well was the second half of it, Dana, where he wrote essentially that he has canceled all meetings with Iranian officials. I should note, it's unclear if there were actually any meetings currently on work that were on the books. But then he also said, help is on its way.

Look, this is a very different posture than what we were hearing just 24 hours ago. I'd remind you one, Sunday, the president said that, you know, he was open to setting up a meeting that the Trump administration had been talking with Iranian leaders about getting some sort of diplomatic channels open to discuss all of this.

We also heard from Karoline Leavitt, the press secretary yesterday, saying that diplomacy is still the priority for the president that he would prefer diplomacy over going down a route that would, you know, include potential military action inside Iran. Well, this is now a 180, and it seems that the president, at least for now, is kind of ruling out diplomacy here.

And of course, this comes as we know that later today, when the president returns from Detroit, he's expected to receive a briefing from his top national security officials, people like the Secretary of State Marco Rubio, Defense Secretary Pete Hegseth. The list goes on. But laying out and continuing to lay out the different options he has at his disposal to intervene on behalf of the Iranian people who are protesting against the government.

Now, some of these options that we've heard, Dana, include potential military strikes, more likely an air strike. And if the president does decide to choose one of those options, there are still many questions about what they would actually target. Would it be a potential government facility? Would it be something that could undermine the security services in Iran.

But they're also looking at, we're told a number of non-kinetic options, things like, you know, cyberattacks and sanctions on Iran.