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Quest Means Business
U.S. Senate Approves Trump's Megabill With Vance's Help; Tesla Shares Tumble As Trump And Musk Reignite Feud; Trump Visits Alligator Alcatraz Detention Center; Fed Char Says Rate Cuts If Not For Tariffs; Jury Says It Has Verdict On Some Counts In Combs Trial. Aired 4-5p ET
Aired July 01, 2025 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:11]
PAULA NEWTON, CNN INTERNATIONAL HOST: You know, I don't have to remind you. That's a good day for the first day of trading of the new quarter. At least
the Dow, anyway, extended its record high. Those are the markets and these are the main events.
President Trump's Big, Beautiful Bill passes the Senate despite new threats from Elon Musk.
The chair of the U.S. Federal Reserve says he would have already cut rates this year if it weren't for Trump's tariffs.
And wildfires are sweeping right across several European countries as temperatures there spike.
We will hear from the CEO of insurance giant, Swiss Re about the potential damage.
Live from New York. It is Tuesday, July 1st. I am Paula Newton, in for Richard Quest and this is QUEST MEANS BUSINESS.
And good evening to everyone.
Tonight the U.S. Senate has approved President Trump's sweeping domestic policy bill. The Senate vote was 51 to 50. Yes, with Vice President J.D.
Vance needing to break the tie. The bill extends Mr. Trump's first term tax cuts and it slashes spending on health care and other social programs.
Critics say the bill will add trillions to the national debt. The President says it has enough Republican support to clear a final vote that now needs
to happen in the House. Listen.
(BEGIN VIDEO CLIP)
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES OF AMERICA: It tells you there is something for everyone. I mean, we have -- it is a great bill.
There is something for everyone and I think it is going to go very nicely in the House. Actually, I think it will be easier in the House than it was
in the Senate.
(END VIDEO CLIP)
NEWTON: And we do go live now to Capitol Hill, where all the action has been our Annie Grayer. Annie, they did it. He did it.
This did not look like a sure thing. And yet, by the end of the day, it was, I think the first question to you is, will there be a political price
to pay for this, given it was so close and that the Vice President did have to break the tie?
ANNIE GRAYER, CNN CAPITOL HILL REPORTER: Well, let's look at the three Republicans who voted against this bill, which was the maximum of no's that
the Republicans could have taken and still gotten the bill passed. So Senator Rand Paul had long been a no on this piece of legislation because
of the attachment of the debt limit to Trump's bill. So he is kind of in his own category. But then let's look at Senator Thom Tillis and Susan
Collins.
Senator Tillis voted against proceeding against this bill and the next day announced his retirement. So that just shows you how he was preparing for
the political blowback that he was going to receive by coming out against this bill.
Now, the big question mark is going to be Around Republican Senator Susan Collins, who voted against this bill. She is up for re-election in 2026.
She has not firmly announced if she is running again, but all signs are pointing towards her doing that. So this is going to be a huge question for
her: Is there room in the Republican Party to vote against a piece of legislation that President Trump wants so badly and still represent your
state?
So that is kind of the political calculus that's going on right now, and of course, Republican Senator Lisa Murkowski, who was weighing whether or not
to vote yes or no on this up until the last minute, told me after the vote that she supported the legislation because she got a lot in the back door
negotiations, but she is not even satisfied with the version of the bill that she votes on.
She hopes that the House will send it back, but that just shows you how much of political calculations are going into these senators for their
voting.
NEWTON: Yes, and it gets incredibly complicated as well as you point out. There is -- there are a lot of back room deals to get that one or two votes
over the line.
I want to ask you, though, what happens now that it goes to the House? Now, the President has been very clear. He wants a big ceremony, July Fourth to
sign this thing. Are people ready, you know, to put money on it, to say, yes, this will happen.
GRAYER: There are a lot of steps that need to happen between now and President Trump potentially signing this piece of legislation. So the House
Rules Committee is currently meeting on the Senate's bill to discuss the changes that were made in this Senate-passed bill and what the House passed
a few weeks ago.
So it has to clear that committee, and then tomorrow morning, House Republican leadership is hoping to have this on the floor as early as 9:00
A.M. tomorrow. But a lot of Republicans are coming back into town reading through what passed in the Senate and realizing that there are a lot of big
differences when it comes to how Medicaid is going to be cut and phased out, how much of the fund rural hospitals are going to get, what kind of
phaseout for energy tax credits there are? How deep of the spending cuts there are?
[16:05:12]
These are all issues that were coming up in the House. So now, Republicans have to get together and see if they can also line up behind this bill and
give President Trump his win for July 4th. But just remember, Republicans can only lose three votes in the House if they want to pass it with all
Republican votes. That's going to be a very tight rope for House Republican leadership to walk.
House Democrats, meanwhile, are meeting tonight at 6:00 P.M. to discuss their strategy because there are a lot of legislative levers that Democrats
can pull to try and delay and slow down this process, to try and have Republicans miss that July 4th deadline. So that is all of what is juggling
in the House right now. And as I was saying, it is a lot between now and a potential bill signing.
NEWTON: Yes, still a lot going on in Capitol Hill on this holiday week. Annie Grayer for us, thanks so much for bringing it all to us now.
As you just heard Annie talk about the bill's enormous cost there, it is actually now rekindled Elon Musk's feud with the President.
Musk is vowing to start a new political party if the bill becomes law, and he is promising to go after Republicans who voted for it. In response,
President Trump suggested that the U.S. government could stop doing business with Musk's companies.
Tesla investors are watching all of this carefully. As you can imagine, the automakers shares closed 4.3 percent lower. They are down 12 percent in
fact, over the past month.
Hadas Gold is with me, and you've been following this back and forth for so many months now. So Elon Musk now apparently back in the political game
when he had indicated that perhaps he wouldn't be doing this, what material, like substantive damage could Elon Musk do if not to the bill
then to politics -- the MAGA politics going forward?
HADAS GOLD, CNN CORRESPONDENT: Yes, well, listen, Elon Musk can make a huge damage if he wants to because Elon Musk is the type of person that when he
gets obsessed with a project, he will go all in on it, you know, kind of go founder mode, as they like to say, spending 24 hours a day on it and he has
the funds, endless funds essentially to back him up.
So this is the starkest political threat we have really heard from him because yes, he got into that fight with President Trump a few weeks ago.
They had the big blowup. They seemed to sort of makeup, but it wasn't clear how that would translate politically. And now Elon Musk is laying it out
and he is saying, I am going to be supporting any primary challenger to a member of Congress who has talked about cutting government spending, but
voted for this bill.
He put up what would be essentially a poster. He said that all of these potential members of Congress would face, and it looked like a Pinocchio
doll going up in flames, saying that their face would be superimposed on this and that is what they would see.
And then, as you noted, he is also stating that if this bill passes, then he will be starting a new party, which he dubbed the America Party. That is
also the name of the super-PAC that Elon Musk supports. That's the PAC that funneled so many hundreds of millions of dollars to support President Trump
and other Republicans last year, and he said that he will start this party.
Of course, that's a whole other story about how difficult it is to create a new political party. But Even Elon musk just getting involved in a primary
that can have a lot of effect, you know, of course he has a lot of money.
Now, President Trump's brand, of course, is still very, very strong amongst Republicans. It is much stronger than Elon Musk. So we will have to see how
that will actually play out in actual elections, but Elon Musk has already said that he is going to be supporting at least one opponent that President
Trump has declared, and that is Congressman Massie.
Massie, of course, is one of only two Republicans who voted against this bill in the House. Elon Musk saying publicly on Twitter that he is going to
be supporting Massie. And President Trump actually, just a few minutes ago on Air Force One, saying that Massie is going to be history. So we can
already see ourselves setting up kind of a new fight going forward.
This is obviously a complete flip-flop for Elon Musk. He spent all of that money last year on President Trump. He spent more money in the beginning of
this year on that Wisconsin race. He had -- there are reports that he had promised $100 million to President Trump's aligned Super PACs and outside
groups ahead of the midterms. Obviously, that might be off the table. And we heard Trump hitting back, suggesting he might be using DOGE to go after
Elon Musk as well.
But so far, Elon seems to be at least holding back the more personal attacks that we saw last time around. He wrote in a post on X: So tempting
to escalate this. So, so tempting, but I will refrain for now. And as we are seeing right now that Tesla stock, investors not so happy about this,
they were looking forward to Elon Musk staying away from the politics, focusing on Tesla, focusing on SpaceX.
Tesla had a big week with robotaxi being rolled out in Austin. They were really hoping that they could get Elon's attention back on his companies.
But obviously the pull of politics cannot keep Elon Away.
NEWTON: Yes, Hadas, I am sure you were startled like I was to actually hear Democrats praising Elon Musk and agreeing with him in a certain way to say,
yes, Elon Musk is right. This bill will do damage.
Hadas Gold for us, thanks so much. Appreciate it.
[16:10:06]
Now, as the Senate voted on the bill, President Trump toured a remote migrant detention center in Florida dubbed "Alligator Alcatraz." The
facility was once an airport and sits deep in the marshy wetlands of the Everglades.
It is surrounded by alligators and not just alligators, pythons as well. Officials say the center will house up to 5,000 migrants as they await
their deportation. Listen.
(BEGIN VIDEO CLIP)
TRUMP: It is known as Alligator Alcatraz, which is very appropriate because I looked outside and that's not a place I want to go hiking anytime soon.
But very soon, this facility will house some of the most menacing migrants, some of the most vicious people on the planet.
We are surrounded by miles of treacherous swampland, and the only way out is really deportation. And a lot of these people are self-deporting back to
their country.
Kristen Holmes joins us from the White House now. Good to see you, Kristen.
This detention center being portrayed, of course, by the White House and you just heard the President, as a big win and that's on top of the fact
that if we go back to the bill that just passed the Senate, it could be law in a matter of days. It would include more than $140 billion altogether for
border security, money for ICE staff, and more of those detention centers that the President likes so much.
I mean, what is the White House saying about where all of this is going? Because even within his base, you are hearing people ask and say out loud,
is this crackdown on illegal immigration going too far?
KRISTEN HOLMES, CNN NATIONAL CORRESPONDENT: They don't believe it is going too far. And you heard -- we had a reporter there on the ground today in
Alligator Alcatraz who talked to at least one Trump supporter who was saying that this is what they wanted to see in their area and that's the
group of people that President Trump is trying to appeal to, it is his base.
And we should make no mistake that the timing of this trip is not a coincidence. There are a lot of other things in Washington going on that
play into this trip, one of them being this budget bill.
President Trump has been trying to strongarm this enormous budget bill through Congress that would provide more aid to ramp up deportations in the
United States. This was part of that, to showcase what they are doing.
President Trump has wanted to show the optics of his hard line immigration policies and the reason for that is because he believes that that is
something that his base wants, but he also believes that they still have positive numbers from around the country when it comes to the issue of
illegal immigration.
Now, as you said, it is less positive than it was after he was elected. However, his team still believes this is a winning issue for them and
they're going to continue to double down on this and just make no mistake, I mean, this is the kind of center that President Trump has been talking
about for some time, not necessarily this idea of crocodiles and alligators, but it is something that he has been talking about, these
maximum security prisons or holding centers in which people can't get out or escape, which is what he was talking about on the lawn before he went to
Alligator Alcatraz and saw Florida Governor Ron DeSantis down there.
And it should be noted that Governor DeSantis has really been on the forefront of all of these immigration policies. He has fully embraced
President Trump's stance on immigration. And so it is no surprise that he is the one who built this -- a facility like this.
NEWTON: Yes. It is good that you remind us again, this is what voters, many voters wanted in the United States and Donald Trump continues to double
down on that. Kristen Holmes for us at the White House. Appreciate it.
Now, still to come, Europe swelters under record breaking temperatures. Extreme heat events are causing concern for a leading global insurer. We
will hear from the CEO of Swiss Re, next.
(COMMERCIAL BREAK)
[16:16:23]
NEWTON: An extreme heat wave continues to grip parts of Europe. Temperatures reached above 40 degrees Celsius, that's more than a hundred
degrees Fahrenheit in parts of Spain, Portugal and France today.
The heat triggering health alerts right across the region. Melissa Bell has our report now from Paris.
(BEGIN VIDEOTAPE)
MELISSA BELL, CNN SENIOR INTERNATIONAL CORRESPONDENT: This is one of Paris' main train stations, the Gare Saint-Lazare, and you can see people have
come out to distribute water to passengers. But perhaps more importantly, in a bigger reflection of the impact of this heatwave on cities like Paris
that are simply not used to coping with temperatures like this, is that all the trains are now at a standstill and will be for the next several hours
because we are told the heat has impacted the rail network.
It is a reminder amongst so many others of some of these very difficult conditions being faced across Europe as a result of this heatwave, not just
high temperatures of more than 104 degrees in many parts of Europe this Tuesday from Italy, Spain, Greece and France. But it is also that this heat
wave, which has come at an earlier time than many of the heatwaves we've seen in previous years, 2023, 2024 had already seen records set as experts
told us, this is the new normal.
This time, the heat has come earlier and of course that means greater risks and dangers looking ahead, if this continues to be a very hot summer of
wildfires and all the other difficulties linked to extreme heat conditions, as Europe settles into what is in its normal Europe, which is currently the
fastest warming continent in the world.
Melissa Bell, CNN, Paris.
(END VIDEOTAPE)
NEWTON: Now, as Melissa just touched upon, wildfires are sweeping across several European countries as those temperatures spike. In France, fires
broke out on Sunday in the southwest of the country, burning nearly 400 acres, or about 160 hectares; in Turkey, 50,000 people have now been
evacuated as firefighters tackle fierce blazes, mostly in the country's western provinces.
Swiss Re, one of the world's top reinsurance firms, says about 480,000 people -- think about that -- die each year from extreme heat. That makes
events like these much more dangerous than floods, earthquakes and hurricanes combined.
Joining me now is Swiss Re CEO, Andreas Berger. I want to thank you for joining us. As we continue to deal with this extreme heat, I mean, your
insurance company has pointed out there is clear evidence that extreme heat events are now more frequent and more severe. And I want to underscore a
point here. This isn't going to change. You know, given where we are, current climate conditions.
So where do you see this going? You know, we just heard from Melissa Bell about how the infrastructure in France, the heat is so severe that even the
infrastructure is being impacted.
ANDREAS BERGER, CEO, SWISS RE: Yes, Paula, thank you for having me here. This is a serious problem. And the data shows clearly that the frequency
and the severity, not only of extreme heat, but also natural catastrophes in general, is increasing. And clearly, there is something that has to
change.
The traditional or conventional measures are not sufficient anymore to address this problem and I think here, we need to all come together. It is
not one party alone that can solve the problem. This is a multi-stakeholder approach.
Just on natural catastrophes in general, 2024 was the fifth consecutive year where we exceeded $100 billion insured losses -- U.S. dollar insured
losses. This year we expect around $145 billion of losses of natural catastrophes.
[16:20:08]
So this is something that we have to deal with. We, as a reinsurance company, Swiss Re, we are the shock absorber of the industry. We sit behind
insurance companies. And we can provide parts of the solution which is providing data, data models that we can provide a good understanding over
161 years of collection of data, lost data, and also we have more than 50 scientists who work on more than 200 proprietary models also, to address
this topic.
NEWTON: But people and I say people, I mean, stakeholders of all kinds have to understand the data, the science, and then actually do something about
it.
I do want to get to what can be done in a moment, but I would say if I look at it from my point of view, we all seem to be collectively jumping off a
cliff here with no net. And the reason is because your predictions of uninsured losses are quite grave. And on top of that, we have governments
who are less and less able to really back up those protections for people, companies and their livelihoods.
Where do you see this going? And when do you believe it will be so critical it will be difficult to ignore?
BERGER: So this problem, as I said, is too big to solve just by one party, by governments for instance. We just have to come together. We can provide
the data to understand really there are three steps that we need to look at to understand and quantify the risk. Very often, that's where the problem
starts, because data is not readily available. It is fragmented. So I think we can help to make sense of it.
Secondly, we need to talk about mitigation. There is so much that can be done. And thirdly we can only talk about as insurance or reinsurance
solutions.
Now, it is the 20th anniversary, by the way, this year in August for Hurricane Katrina. You know, if these events would happen again today,
normally those losses would be three times higher. Now, in the case of Katrina, if this would happen again in Louisiana, it would be less
impactful than actually Katrina in those days when it happened.
Why? Because mitigation measures were taken. Also, building codes have been updated. So all of these things are very important to reduce the exposure.
There is a lot that can be done. But I think, awareness, creation, quantification of the risk and trying to find out what actually can be done
to mitigate it, and only then you talk about insurance and reinsurance to provide our balance sheet.
This is a tripartite relationship. It is the government with the public hand, the private industry and we also obviously as an insurance and
reinsurance industry come to the party.
NEWTON: You know, this can seem a bit overwhelming obviously, for people in their own personal lives, but also for businesses. You know, a recent
report that you published showed the vulnerabilities to infrastructure. And as I said, we just heard about in Paris how the rails were impacted. I
mean, what do you say to people that given the context right now, that the advice that you are giving people about mitigation is actually not taking
place, or if it is taking place, not taking place quickly enough?
BERGER: Yes, we have more and more companies, but also municipalities coming to us and asking the question, what can we do? But not only today,
but also what can we do in ten, twenty, thirty, forty and more years? We need to anticipate, we need to do projections, and now we can simulate when
we can assume, for instance, temperature rises.
What does that actually mean? And what does that do to the physical assets of a municipality, the schools, the buildings of companies, for instance,
telecommunications companies who are suffering now with the cooling of their data centers -- that all can be anticipated and one can plan for it.
The investments can be directed towards mitigation properly and in advance.
I think there is a lot that can be done and I think as an industry, we can come together and provide our support for the solution.
NEWTON: Andres Berger a sobering conversation, but a necessary one. I want to thank you for joining us.
BERGER: Thank you very much, Paula.
NEWTON: Now, the U.S. Federal reserve chair says tariffs, they are the reason interest rates have been static this year. Jerome Powell says the
Fed would have lowered rates without them. That's next.
(COMMERCIAL BREAK)
[16:27:43]
NEWTON: Hello, I'm Paula Newton and there is more QUEST MEANS BUSINESS in a moment when the U.S. Federal Reserve Chair says interest rates would be
lower if it weren't for tariffs.
France has banned -- banned cigarette smoking. Can you believe it -- in France's public spaces, those frequented by children. President Macron is
pledging to create the first tobacco free generation.
Before that, these are the headlines this hour.
President Trump's sweeping domestic policy bill is one step closer to becoming law. Now, the bill was narrowly approved by the U.S. Senate thanks
to a tie-breaking vote from Vice President J.D. Vance. It now faces one final vote in the House. Mr. Trump hopes to sign it by the end of the week.
While the Senate was voting, Mr. Trump visiting a migrant detention center known as Alligator Alcatraz. It is being built in the Florida Everglades at
an airfield that never opened to the public. Environmental groups, migrant rights supporters and native Americans are among those opposed to the plan.
Thailand's Prime Minister has been suspended over a leaked phone call with Cambodia's leader. Now on the call, Paetongtarn Shinawatra appears --
appears to criticize her own Army. This after border clashes led to the death of a Cambodian soldier in May. She told Cambodia's Hun Sen that if he
wants anything to tell her and she will take care of it. The court accused her of breaching ethical standards, but she says it was a negotiation
tactic.
And we do want to return to our top story. President Trump's so-called Big, Beautiful Bill is on its way to the House after passing a narrow Senate
vote just a few hours ago.
My next guest is "The Financial Times" U.S. national editor, Edward Luce. His latest piece is entitled "Donald Trump's Big Beautiful Act of Self-
Harm." Luce argues that the bill would transfer money from the poor to the rich, and that it will come back to haunt Republicans at the polls.
I want to thank you for joining us as we continue to digest what just happened on Capitol Hill. Your first point, this will damage Trump's blue
collar MAGA brand. Are you sure? How will that happen?
[16:30:52]
EDWARD LUCE, U.S. NATIONAL EDITOR, FINANCIAL TIMES: You can never say never. I mean, and of course the age of disinformation and the age of
propaganda and social media means there isn't necessarily a straight line from doing something and being held accountable for doing it. But the two
biggest parallels with this big, beautiful bill, in terms of just the unpopularity of going for Medicaid and food stamps, but Medicaid, half of
Medicaid recipients voted for Trump, half.
The biggest parallel is George W. Bush in 2005 pivoting to a plan to privatize Social Security, which caused an enormous boomerang effect,
blowback, and contributed to the big Republican midterm defeat the next year in 2006. And then, of course, again, Trump in his first term trying to
abolish Obamacare, which included the Medicaid expansions, defeated by one vote, John McCain, the late John McCain being that key vote. And that fed
into the reaction against Trump in his 2018 midterms. Difference here is that this has been passed.
NEWTON: Now, you believe, though -- exactly, John McCain had stopped it the last time. You believe, though, that the economics of this bill are also
pretty simple in terms of what it will do. Trump is robbing the poor to pay to the rich. Even so, do you believe that Republicans will actually be
punished for that given the timeline?
And I do want to say, and, you know, because you've heard these arguments, right, that economists say that this will actually create a boom for the
American economy and that it will, and here's that word again, trickle down to Americans of all incomes.
LUCE: So we're in a slightly different environment than we were in 2017 when he had his big tax cut, which did generate higher growth, including
wage growth. Not enough wage growth to stop a defeat in the midterms, by the way, in 2018. But we're in a very different post-COVID world of higher
interest rates, of supply chain, continual concerns about supply chain flows, and therefore in-built inflation.
And of course, we've got -- you've been reporting on it, but we've got this stand up fight between Donald Trump and the chair of the Federal Reserve,
and the U.S. treasury bond markets continually just slapping Trump down when he goes too far. Well, this is a bill that massively increases the
U.S. deficit and therefore raises the cost of borrowing.
So I'm much more skeptical of projections of a boom coming out of this bill than I think would have been merited in 2017 with his big tax cut. It's a
very different world. We're living in a monetarily tight environment.
NEWTON: Yes, not to mention the risk to inflation even if there is a boom and the fact that, yes, as you said, it's a different world in terms of
interest rates and what the Fed can do.
I do want to get to this point, though, about it being a different world. You know, in less than six months, it seems to me that the very character
of power and how it's wielded in government has changed. Even in Trump's second term compared to his first. He is arguably, successfully weaponizing
his administration. And I want you to listen now to what he said about wielding that power against the person you mentioned, Elon Musk. Listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED REPORTER: Are you going to deport Elon Musk?
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I don't know. I think we'll have to take a look. We might have to put DOGE on Elon. DOGE is the monster
that might have to go back and eat Elon. Wouldn't that be terrible? He gets a lot of subsidies.
(END VIDEO CLIP)
NEWTON: Now, you know, here's the point I want to make. Musk posted on President Biden as well. He called him a puppet. I want to bring it up. It
was from the fall before the election. Biden's puppet masters, Elon Musk posted this, are at fault. He is just the puppet who talks the words on the
teleprompter. I think this would be like President Biden, his comeback to Elon Musk in the fall would have been, well, maybe I should get the IRS to
audit Elon Musk.
Where do you see all of this going? Because at this point, the power of the executive and his ability to weaponize it seems to have been normalized to
me?
LUCE: I mean, it has been normalized. And Trump doesn't see a distinction between public and private. It's personal. Everything is personal. The
resources, the awesome resources of the federal government are at his disposal. The Department of Justice are his personal lawyers. He sees the
state in the way, say, the Saudi royal family sees the Saudi state. There is no distinction.
And I think Elon Musk has therefore badly underestimated who's got most of the cards in this battle.
[16:35:01]
Now, Musk might be right in some of his criticisms particularly, you know, the irresponsibility of this big, beautiful budget that Trump is getting
enacted. But if Trump wishes to deprive Elon Musk's companies of federal contracts, if he wishes to block Tesla's advance through regulatory red
light, if he wishes to kick SpaceX off its contracts with NASA, even though, you know, NASA might have a few stranded astronauts up there, he
can do that.
And what can Musk really do back at him? With whose army? So I think, I think Musk has really, really misunderstood. And then, of course, there is
the fact that he has made some criticisms, such as about the Epstein files, which imply that Trump, you know, is a sexual abuser. And I mean, I imagine
that Trump will find that pretty hard to forget.
NEWTON: Yes, he hasn't brought up those personal attacks again. But we wait because this is not the final chapter, I'm sure in the relationship with
these two men or how President Trump intends to use the government, if indeed he does, to punish the world's richest man.
Edward Luce, we will leave it there for now. Thanks so much.
LUCE: Thank you.
NEWTON: Now, as Edward and I were just talking, talking about the chair of the U.S. Federal Reserve, and he now says it would have already cut rates
this year if it weren't for tariffs. Jerome Powell told a central banking forum in Portugal that tariffs changed the equation.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Chair, would the Fed have cut more by now if it weren't for the tariffs?
JEROME POWELL, U.S. FEDERAL RESERVE CHAIR: So I do think -- I think that's right. In effect we went on hold when we, when we saw the size of the
tariffs and where, and essentially all inflation forecasts for the United States went up materially as a consequence of the tariffs. So we didn't
overreact. In fact, we didn't react at all. We're simply taking some time.
(END VIDEO CLIP)
NEWTON: Now President Trump has been pressuring Powell to lower interest rates. He's called the Fed chair, I'm quoting here, "a numskull and a
moron." On Monday, Mr. Trump posted a written note on social media telling Powell that higher rates were costing the USA a fortune.
Vanessa Yurkevich is here with me to break it all down.
We do have to remind viewers, right, Donald Trump appointed Jerome Powell. Just a small technicality at this point. But, Vanessa, not going to lie, I
heard those comments from Fed chair and my jaw dropped because it was pointed. It was blunt, wasn't it?
VANESSA YURKEVICH, CNN BUSINESS AND POLITICS CORRESPONDENT: Yes. He said a lot more at the Central Banking Forum that he has previously, and it could
have been the company he was with. He was with other central bankers. There were economists in the room, but essentially Jerome Powell was also asked
by the moderator whether or not President Trump's harsh criticisms of him publicly was affecting his ability to do his job, and he said no.
He said, essentially, "I'm very focused on just doing my job." And as you mentioned, pressure from the president has been mounting in recent months.
Just recently, as you pointed to, yesterday, this handwritten letter that the president wrote to Jerome Powell, it was on a sheet of paper that also
had, as you see there, the world's central bank rates of other countries. And there was listed there 34 countries that had lower rates than the
United States.
His writing there then goes on to say that because Jerome Powell and the Federal Reserve has not lowered rates, that it's costing the U.S. billions
of dollars. And the little side note there on the right hand corner of your screen suggests that the Federal Reserve should lower interest rates to 1
percent. Currently, interest rates are more than four times that.
But I thought it was also interesting at this central banking forum, the moderator asked Jerome Powell what advice he would give to his successor
because Jerome Powell is coming up on the end of his term in about 10 months. Listen to how he responded.
(BEGIN VIDEO CLIP)
POWELL: We're trying to deliver macro stability, financial stability, economic stability, too, for the benefit of all of the people. If we're
going to do that successfully, we need to do it in a completely nonpolitical way, which means we don't take sides. We don't play one side
against the other. We stay out of issues that are really not our bailiwick.
(END VIDEO CLIP)
YURKEVICH: So more pushback, either direct or indirect, on President Trump in his pressure on the central bank to lower interest rates. Jerome Powell
also went on to say that he does believe that current monetary policy is moderately restrictive, but that is for the reason that he says that
they're waiting to see what happens with these tariffs, whether or not they have an impact on the economy that they had been thinking.
He went on to say that he does believe inflation will rise, and that he really couldn't say much about this meeting coming up in the next few weeks
and whether or not they're going to make any moves on interest rates. But he did say that within the voting body of the Federal Reserve.
[16:40:03]
There was enough consistency among members that likely at some point this year, Paula, we will see some kind of cut just looking rather unlikely that
it will be in July. I'm sure we'll hear from President Trump on more about his disappointment around that, Paula.
NEWTON: All right, Vanessa, we'll see what continues to happen between these two men and their sparring. Appreciate it.
Now, coming up, Britain's royal train is set to be decommissioned. The service has become too expensive to maintain. We'll tell you about it next.
(COMMERCIAL BREAK)
NEWTON: Pollution from artificial light is increasing every year, with negative consequences for wildlife and human health. Today on "Call to
Earth," we join a British astrophotographer as he highlights the importance of a truly dark sky.
(BEGIN VIDEO CLIP)
AARON CHERRIE, ASTROPHOTOGRAPHER: As an astrophotographer I come to places like this all the time and seek out dark skies. But that's becoming a rarer
and harder thing to find nowadays. The saddest thing is that people don't get to witness things like this. This shouldn't have to be so hard to get
to.
My name is Aaron Cherrie. I'm a bar owner in Redruth and I'm a part-time astrophotographer.
This is Saint Michaels Mount. It's one of the most beautiful locations, I think, in Cornwall. Right now at this location we couldn't shoot much
astrophotography here because the light pollution is too much in the background from the villages, from the town, from the street lighting.
Places like this really affects the natural world and insects, moths, birds. It all has a knock-on effect.
KEVIN GASTON, PROFESSOR OF BIODIVERSITY AND CONSERVATION, UNIVERSITY OF EXETER: Light has been used throughout much of evolutionary time as a as a
measure of timing.
[16:45:07]
And so lots and lots of organisms have used that. And now what we're doing is changing those natural cycles of light through the introduction of
artificial light. Organisms are using it to determine when they might flower, when are they going to reproduce, when are they going to migrate,
when are they going to feed. So we're fundamentally eroding, distorting those light cycles on an enormous scale.
Dark Sky International is the leading organization internationally protecting dark skies, restoring dark skies where we've already lost them
because of the introduction of artificial light.
CHERRIE: Let's bring up light pollution map. This is the West Penn with dark sky location, which is a national dark sky site. And this is where
I'll be going tonight to take pictures of the Milky Way. This is probably the darkest skies we've got in the U.K.
We've all got to appreciate the night sky, even if it just means turning off your security light and going outside and standing out there for 10
minutes. You'd be surprised what you might see.
And now we're ready to start shooting. So this will be a 15-second exposure at F-2.8 ISO 6400. Now that shows you how much light pollution is now
coming from Penzance, a local town here.
GASTON: Lighting is one of those things that we can do something quite quickly about, both individually and corporately. Many of us have control
over at least some forms of nighttime lighting, so reducing the spill of lighting outdoors. I think everybody can do their part in this.
CHERRIE: You see, the Starlink trains, we have the auroras going off at the minute with the solar cycle being at its peak. But these things are missed
by light pollution. By doing what we do here with astrophotography and stuff, it's trying to recapture that and then spread that with the world
and seeing what nature really has to offer.
(END VIDEO CLIP)
NEWTON: Now, please do let us know what you're doing to answer the call with the hashtag "Call to Earth."
(COMMERCIAL BREAK)
[16:50:11]
NEWTON: And we do have breaking news for you now, the jury in the trial of Sean "Diddy" Combs says it has reached its verdict on some of the charges.
We want to go right to our colleagues at CNN U.S. for more now.
Just wait one moment as we try and continue to join our colleagues. We're going to try and join our colleagues at CNN U.S. in a moment. I do want to
repeat that the jury in the Sean "Diddy" Combs trial has reached a verdict, and this is on some counts. Now, what will be interesting here is if the
judge says you need to go back on any counts that you have not yet decided on, whether or not the jury needs to go back and deliberate on those.
Remember that this jury is sequestered and they are basically confined and are together until they can reach a verdict on all those charges. The judge
will have a few options here, but he will definitely want to know on the charges if it is more than one charge that they did not reach a verdict on
exactly what happened.
It goes without saying that this has been an intensely scrutinized trial with a lot of painful testimony, especially from Sean "Diddy" Combs' former
girlfriend. But what was interesting here was the fact that Sean "Diddy" Combs was actually charged with something that went beyond domestic
violence. A lot of viewers will remember that there was a very troubling video first reported by CNN, where you actually do see the fact that he is
striking his girlfriend.
But this trial has to do with so much more. It has to do with conspiracy charges, human trafficking, racketeering, and that is what the prosecution
in this case was trying to prove. The defense saying that while this relationship was troubling, they said that there were many troubling
relationships, but that it did not amount to a guilty verdict on what the prosecutors were alleging.
We will continue to wait to try and join our colleagues. But as I said, they -- the judge has not yet decided whether or not he is going to bring
the jury forward or send a note to them to then say, look, you need to go back and deliberate on this other charge.
I want to go now to David Weinstein, who joined us yesterday, in fact, on this very story.
David, I don't know if you could hear me yet.
David, can you hear me? It's Paula in New York.
KASIE HUNT, CNN ANCHOR: Can I ask you? We've obviously seen in some of these high profile trials lately that how public opinion is breaking on
things is, you know, becomes a story. Can you talk a little bit about how there are some people, obviously out there who have been supportive of Sean
"Diddy" Combs throughout this, of course, Cassie Ventura took the stand and she has had so many supporters and backers.
How do you think the public is going to begin to react to this?
ELIZABETH WAGMEISTER, CNN ENTERTAINMENT CORRESPONDENT: Absolutely. This is a case and really a saga that has played out in the public eye. Remember,
it's not just this trial pertaining to Combs. Combs has been the subject of dozens. We're talking nearly 70 civil suits against him. Now, of course,
those civil suits have nothing to do with these charges that the jury has now come back with a verdict on. Four of those charges.
But still, I only say that because the public has been weighing in on Combs for a year and a half, really, ever since Cassie Ventura came forward with
her lawsuit. That bombshell lawsuit back in November 2023. And even though this trial has nothing to do with those civil cases, this trial wouldn't be
happening. There would have not have been an investigation without Cassie filing that civil suit.
So in the court of public opinion, in the world of memes and the world of TikTok, people certainly have their opinion on Combs. And I have to tell
you, it has not been good. But when this trial began, you started to see the tides shift a little bit. A lot of people saying online Combs doesn't
sound like a good guy. He does not sound like he has done good things, but these charges, do they quite line up?
And that's exactly what the defense said. You remember day one during their opening statements, the defense said our client has done terrible things.
The domestic violence is indefensible. You may not like some of his decisions. You may be freaked out by his sex life, but he is not a sex
trafficker. He is not a racketeer.
[16:55:00]
So this trial has actually changed the court of public opinion in a way because people are wondering, do the allegations fit the charges here? And
that has been interesting to see, especially because this trial has become such a pop culture phenomenon.
HUNT: Laura, can you talk a little bit? And then, Elie, I'm going to bring you in on this kind of same question, but we really did see the defense
kind of change their strategy or, and correct me if my understanding of that is wrong, but the defense seemed to change their approach at the very
end to how they were kind of closing things out here.
How do you think that may have impacted what we may be about to see here in learning more about what the verdict is?
LAURA COATES, CNN ANCHOR: Well, both sides were trying to be nimble as the evidence was coming in. The prosecution of course, you think about how
people lay out their cases, it's, I'm going to tell you what I'm going to tell you. I'm going to tell you, and I'm telling you what I told you,
right? Well, it doesn't always come in a linear fashion.
And I suspect that when the prosecution was unable to access or actually call at least one of the named victims, their strategy had to change as is
the fact that these are not robots who are testifying. And so what you would like to come in as perfect information doesn't always happen that
way.
Now the defense, meanwhile, have to be reactive. It's never their burden to prove their innocence, always the burden for the prosecution to prove their
guilt. But they're both going to be nimble. Now, towards the end of trial, we've all been wondering, would Sean "Diddy" Combs take the stand in his
own defense? They opted no, not just him, but they didn't call any witnesses at all.
People wondered, whether they were overly confident or were they strategic and cunning? Well, it remains to be seen right now, but either way,
remember what happened in the closing arguments, Kasie. After seven weeks of trial, the prosecution says, remember, jury, you only need to know or
identify one instance of sex trafficking per particular person to find the person guilty.
That was a bit of a game changer. It was probably always known to the prosecution, of course, who believes in their case, but to jurors who heard
seven testimony, they may have thought to themselves, well, had I known that, perhaps I would have been attentive differently. In any event, right
now we are all waiting on pins and needles.
Nothing compared to what a defendant is or a prosecution team who believes wholeheartedly in their case, and a defense team who was wondering, was
their strategy appropriate? Should Diddy have taken the stand? What will this mean to the jurors?
HUNT: Indeed, and I know you and Elizabeth are both going to be continuing to report here as we stay in live, breaking coverage while we wait to learn
what the jury has decided.
And to that point, Elie Honig, I mean, we know that the racketeering charge, the RICO charge, the most significant, the one that carries the
life in prison potential sentence. Can you walk us through what the potential sentences are on these other counts? What is Diddy facing?
ELIE HONIG, CNN SENIOR LEGAL ANALYST: Sure. So first of all, let me say this. If you are the prosecutor right now, you don't know what the verdict
is. None of us know what the verdict is, but you are breathing a bit of a sigh of relief because you know the jury will not hang on counts two
through five. And you're always worried about a hung jury as a prosecutor. Now that possibility is off the table. And so there's a bit of relief, I
guess, for the prosecution here.
Now to your question about the potential sentences. The big ones to watch are the two sex trafficking counts because those carry a mandatory minimum
15 years in prison and in the federal system, if you get convicted of 15 years on a crime like this, you will do 85 percent of that time. In some
state systems, you can get 15 years but be out in four or five years. In the federal system 15 years means almost 15 years.
So the two forcible or coercive sex trafficking counts carry minimum 15 years max of life. It's up to the judge where to go within that range. And
then the two interstate prostitution charges are much lighter charges. There's no minimum on those. The max is 10 years. Those are likely a few
year type charges. So there's a lot of variants here depending, of course, on what the verdict is. But even if there are convictions, it matters a lot
whether there are convictions on the sex trafficking, the forcible sex trafficking counts or the interstate prostitution counts. There's a huge
difference between the charges here.
HUNT: Yes. Elie, and forgive this layman's question, but if he were to be convicted on both of the sex trafficking counts, does that 15-year
mandatory minimum, do you add that together? Is that a minimum of 30 years? Is it served concurrently? How does it work?
HONIG: Great question. Those would not be added together. It would not be 30. Theoretically, the judge could do that. There's no way a judge would do
that. There's no way an appeals court would do that. They would merge essentially.
And by the way, on your question about racketeering conspiracy, that too could carry a 15-year minimum if the jury finds that forcible sex
trafficking was part of it and a life max. And let me say, it's not surprising, by the way, that there's a potential hang or there's some issue
on the RICO conspiracy, because that's the most complicated charge.
END
