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DOJ Probe Into Fed Chair Prompts Wave Of Republican Pushback; Trump Says He'll Unveil Affordable Housing Proposal At Davos; Peltola Launches Alaska Senate Bid, Energizing Dems; Clintons Won't Testify In House Epstein Investigation. Aired 12:30-1p ET

Aired January 13, 2026 - 12:30   ET

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

[12:30:00]

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: -- 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.

All of this is really going to be important, of course, to the president in deciding future action here. We'll hopefully know more after this meeting later today.

DANA BASH, CNN ANCHOR: All right, Alayna, thank you so much for that reporting. Appreciate it.

Up next, we're going to go inside Wall Street. Big bank CEOs, they're not talking publicly much about the president's attacks on the Fed. What are they saying privately? Stay with us.

(COMMERCIAL BREAK)

[12:35:19]

BASH: President Trump this morning launched a new attack on the Fed Chair, Jerome Powell. That, of course, is just two days after Powell accused the administration of threatening to criminally prosecute him because it doesn't like his stance on interest rates. The Justice Department is investigating Powell's handling of a multi-billion dollar renovation of its headquarters.

Here's President Trump.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: Well, he's billions of dollars over budget, so he either is incompetent or he's crooked. I don't know what he is, but he doesn't -- certainly doesn't do a very good job.

(END VIDEO CLIP) BASH: The Powell probe prompted a cascade of criticism from top Republicans in Congress, the Wall Street Journal editorial board, global central bank leaders, and even reportedly, the president's own Treasury secretary.

I want to talk about this with Bill Cohan, a longtime financial journalist and founding partner at Puck News. Good to see you, Bill.

I want to start by playing some pretty tough criticism from Senate Republicans, criticism that we don't hear very much these days.

(BEGIN VIDEO CLIP)

SEN. JOHN KENNEDY (R), LOUISIANA: I know Chairman Powell very well. I will be stunned. I will be shocked if he has done anything wrong.

SEN. KEVIN CRAMER (R), NORTH DAKOTA: If we were to do an indictment on everybody that misled Congress in a hearing, we'd have to build a couple of new federal penitentiaries.

SEN. STEVE DAINES (R), MONTANA: I support the independence of the feds, and I hope that this investigation wraps up very, very quickly.

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Do you think the White House is trying to stop the independence of the fed?

SEN. THOM TILLIS (R), NORTH CAROLINA: Somebody at DOJ, I mean, the president said he wasn't in the mix. Another example of amateur hour as far as I'm concerned.

(END VIDEO CLIP)

BASH: But Bill, on Wall Street, it's relatively quiet. Why is that?

WILLIAM COHAN, FOUNDING PARTNER, PUCK: Dana, this is a political loser for Trump. He knows it. This isn't going to work. He's already getting criticism from Republican senators. He's getting criticism from former Fed chairman, former Treasury secretaries, CEOs of Wall Street banks.

He appointed Jerome Powell, chairman of the Fed. The reason this isn't getting any traction is because it's not real. I mean, he claims not to know what the Justice Department is doing. I noticed that whenever there's an indictment or an investigation going on of one of his, quote unquote, "political enemies," he always claims not to be aware of what's going on.

I don't believe that for a second, but I think he knows this is a political loser. He's already sort of backing away. I think this is just another one of those expert diversionary tactics that he's so good at that we always fall for.

BASH: You said that you are hearing some pushback from CEOs of big banks, but generally speaking, again, just we don't hear this kind of criticism usually from the president's fellow Republicans. And sort of the contrast between that and Wall Street has been really interesting to us. So as somebody who understands Wall Street, can you explain that?

And let me just ask you about perhaps why that is. And maybe it's because Wall Street financiers really want interest rates to be lower. And that's what their bottom line is. And that's what their North Star is.

COHAN: Well, first of all, you had Jamie Dimon today on his earnings call and his CFO talking about how replacing Jerome Powell or criticizing Jerome Powell or losing the Fed independence would be a very bad thing. Lloyd Blankfein, the former CEO of Goldman Sachs, tweeted about basically the same thing.

Creating confusion at the Fed level, questioning Fed independence, that is going to result in an increase in short term interest rates or in long term interest rates, which are controlled by the market and is going to sow confusion in the bond market as opposed to be reassuring to the bond market. So that is not going to achieve what President Trump wants here.

So I think, as you say, you're getting outspoken pushback from Republicans in the Senate, which you say we never hear from, which is absolutely right. That's what proves to me that this is a total political loser. And it's just another --

BASH: Yes.

COHAN: -- diversionary tactic.

BASH: Yes. And I want to ask you about something else. But I also would add that the fact that the Treasury Secretary, Scott Bessent, made it be known that he complained about it and opposed it internally is also quite telling.

[12:40:05]

I just want to switch to what the president is doing today, Bill, and he is in Michigan. He is, according to the White House, going to focus on the issue of affordability. He's going to speak about that a couple of weeks or even sooner at Davos. That, of course, is an annual conference attended by many of the wealthiest business leaders in the world.

Now, part of his plan is to block major investors from buying up single-family homes. You know, if you think about it, not knowing a lot about that potential problem, going to Davos to talk about affordability, you could say, huh? But if he's going to send a message to business leaders, stay out of the housing market, do you think that could work?

COHAN: I don't think that -- you know, first of all, there's a lot of private equity firms who are already big investors in the market for single-family homes.

BASH: Right.

COHAN: Some of them have started already talking about divesting those positions. I don't think the president talking about that is going to influence private equity firms one way or another. I don't think going to Davos is the right venue for talking about affordability. That's laughable.

Going to Michigan, that's something else. And he obviously is, and you would know better than I, focused on the midterms coming up. And affordability is a very, very big and important issue across this country. And so, you know, he's right to be talking about that. I don't know that he's done much for any of that, but, you know, we'll give him the benefit of the doubt on that.

BASH: Bill Cohan, always good to talk to you. Always learn a lot from you. See you soon. I appreciate you being here.

COHAN: Thank you.

BASH: And coming up, could Alaska be the state that delivers Democrats a Senate majority? We'll explain next.

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[12:46:27]

BASH: A new wild card Senate race could have a big impact on the balance of power in Congress. That wild card is Alaska. Former Congresswoman Mary Peltola launched her campaign against Republican incumbent Senator Dan Sullivan.

(BEGIN VIDEO CLIP)

MARY PELTOLA, SENATE CANDIDATE: Systemic change is the only way to bring down grocery costs, save our fisheries, lower energy prices, and build new housing Alaskans can afford. Ted Stevens often said, to hell with politics. Put Alaska first. It's about time Alaskans teach the rest of the country what Alaska first and really America first looks like.

(END VIDEO CLIP)

BASH: I mean, to quote Ted Stevens, a former and longtime Republican senator from Alaska is really telling. My panel is back now. Seung Min, you think this is going to be as competitive as Democrats hope it will?

SEUNG MIN KIM, CNN POLITICAL ANALYST: I mean, the fact, first of all, she not only mentioned Ted Stevens, but she said the phrase America first in that ad, really trying to get that sort of really appeal to the Trump voter in Alaska. I mean, this is a really excellent recruit for Democrats. I don't think there's any denying that.

I mean, she is someone who obviously is popular in Alaska, has won statewide because obviously we know that there's only one house representative in Alaska, so they represent effectively the entire state. So it'll be really interesting to see -- I mean, it instantly makes it more competitive than it would be. Now, for her, she's really going to rely on her Alaska specific credentials. I think national Republicans will really make this a nationalized race, trying to point out the fact that this is someone who could hand the majority over to Democrats. So it'll be really interesting to see which argument ultimately wins out.

BASH: Yes, I mean, she's obviously talking about Alaska, Alaska, Alaska. She is a native Alaskan --

AYESHA RASCOE, NPR HOST, "WEEKEND EDITION SUNDAY" AND "UP FIRST": Yes.

BASH: -- and that is a pretty big percentage --

RASCOE: Yes.

BASH: -- of the population, even more when you tend to look at the voting electorate. Seung Min mentioned the way Republicans are responding. We don't have to wait. We already know --

RASCOE: Yes.

BASH: -- the National Republican Senatorial Committee already put out a digital ad.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Mary Peltola wants to make Alaska last again. Men in women's sports. Costs through the roof. Open borders. Alaska energy locked down. Peltola voted with Joe Biden and Kamala Harris at every turn. When asked about Biden's obvious mental decline, Peltola lied.

PELTOLA: I think that Joe Biden's mental acuity is very, very on. He's one of the smartest, sharpest people I've met in D.C.

(END VIDEO CLIP)

BASH: That last comment was from December 27th, 2023.

RASCOE: Yes, I mean, look, they want to tie her to Biden. I mean, I do think that, you know, this is one of those cases where this is likely the Democrats' best shot of taking, you know, of gaining a seat in Alaska. But that doesn't mean it's going to be easy. I mean, but Alaska is one of those states where they have gone against the grain sometimes.

You know, we can always look back to Senator Lisa Murkowski doing her write-in bid, and she was able to make that case. Of course, she's also Murkowski in Alaska, which meant a lot. So, I mean, but I think that this is like, if you're a Democrat, you want to put the best people forward to try to make the shot that you can. And it seems like that's what they're trying to do.

BASH: And I just want to, as I bring you in, Aaron, put up the map or the states that we are going to be looking at that are going to determine the balance of power in the U.S. Senate. There are many more competitive races than this time last year, anybody thought could be. Part of that is recruiting. There are some primaries in these states. But part of it is the political atmosphere right now.

[12:50:18]

AARON BLAKE, CNN SENIOR POLITICAL REPORTER: Yes, there's no question that there's more opportunity for Democrats on this map right now. I think this is a really big recruit for Democrats. It might be their most important recruit when it comes to potentially winning the majority.

And I don't say that because Mary Peltola is going to win this race. I say that because they need to put some of those states that you saw on the map in play. They need to put Ohio in play, potentially Texas in play, Alaska in play.

I think Alaska maybe presents one of the better opportunities there because, as Ayesha said, it has kind of that independent spirit. We saw a Democratic senator elected there in 2008. We saw an independent governor elected. We saw Mary Peltola win, albeit an unusual race where Sarah Palin was on the other side. It was very unpopular in 2022 for a statewide House seat.

So, you know, crazy things can happen, especially when the wind is at the Democrats' back. They need to have as many different opportunities to take advantage of that as possible. And this adds one that's at least plausible.

BASH: Yes. It's -- the fact that, again, Democrats are thinking about states that have been hard for them to win -- Texas, Ohio, although, you know, Sherrod Brown was a senator not that long ago --

BLAKE: Yes.

BASH: -- it's going to be tough, but you know, you never know. And Alaska is going to be fun to watch. If anybody's looking for somebody to send, I'm raising my hand.

Up next, Bill and Hillary Clinton have, quote, "had enough." They are not sitting down with House lawmakers, Republicans, to talk about Jeffrey Epstein. But not just that. President Clinton just put out a statement that is quite telling, not just about this, but about his views on where Democrats should be in fighting this president and this Republican Party.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

[12:56:45]

REP. JAMES COMER (R), CHAIRMAN, OVERSIGHT COMMITTEE: Hillary Clinton's supposed to show up tomorrow. We'll see what happens there. With respect to the former president, he did not show up today. We will move next week in the House Oversight Committee markup to hold former President Clinton in contempt of Congress.

(END VIDEO CLIP) BASH: Contempt proceedings against a former president. Bill Clinton was scheduled to sit down with the House Oversight Committee today as part of its Jeffrey Epstein investigation. That's certainly what the committee wanted.

CNN's Annie Grayer is on Capitol Hill. Annie, this is an extraordinary moment that I'm sure will lead to several more extraordinary moments in the coming week or two. But what we just saw from the chairman is precisely what was predicted in a very lengthy, very hot statement that the former president and his wife, the former secretary of state and first lady, just released a letter to James Comer. Explain.

ANNIE GRAYER, CNN SENIOR REPORTER: So, Dana, what we're headed towards next is potentially lengthy and even unprecedented legal battle. Now that Comer has announced that he's going to move forward with contempt proceedings against both Bill and Hillary Clinton.

Now Hillary has one more option for her deposition date tomorrow. But from the letter that Bill and Hillary Clinton sent to Comer directly this morning, they lay out exactly why they are not planning to appear for their depositions. And this is after months of back and forth, Dana, between the Clintons legal attorneys and the Oversight Committee, where the Clintons have maintained that these subpoenas are not valid, that they are willing to provide written testimony, and that the committee has even granted this option of written testimony to at least seven of the other witnesses that they've subpoenaed in this investigation.

So why not grant them to the Clintons here? And in this letter that you mentioned that Bill and Hillary Clinton wrote to Comer, I want to read for you a piece of it that just shows the stakes that both the former president and first lady and secretary of state understand here.

They say, quote, "Every person has to decide when they have seen or had enough and are ready to fight for this country, its principles and its people, no matter the consequences. For us, now is that time."

Now, Comer maintains he still has a lot of questions for the Clintons. He wants to know about Epstein's relationship with them. But Bill has -- Bill Clinton has never been accused of any wrongdoing. And we are now going to see how far House Republicans are going to take this.

BASH: Yes, we sure will. Thank you so much, Annie.

And back here at the table, Bill Clinton, the former president and the former first lady and secretary of state, also, in addition to that letter, sent declarations of what they do and do not know to the chairman. So much in this letter, because it's pretty long.

"You accepted the least from those who know the most, but demand the most from those who know the least to stay. You can't complete your work without speaking to us. It's simply bizarre." And then just as Annie was saying, the rallying cry that they have written in this to Democrats and to Americans who they know want to see their leaders fight, they're clearly providing a roadmap and a place to rally behind.

BLAKE: Yes, I mean, it's a really interesting decision. We obviously saw when we did get some Epstein files last month, the White House, the Justice Department made very clear they want to focus on the Clintons. That was a big part of the first initial release. I can expect, we can expect now the House to try and continue this moving forward. I think that was really the point of all of this.

BASH: Absolutely. Thank you all so much. Thank you for joining Inside Politics. CNN News Central starts right now.