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Trump Speaks Out About Putin Phone Call, Talks to End War in Ukraine; Federal Judge Let's Trump's Buyout Plan for Federal Proceed for Now; A.G. Bondi Won't Back Musk Call for Wave of Judicial Impeachments. Stocks Slide After Hotter-Than-Expected Inflation Report; GOP Hardliners Threaten Revolt Over Johnson Plan To Implement Trump Agenda. Aired 6-7p ET

Aired February 12, 2025 - 18:00   ET

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

[18:00:00]

WOLF BLITZER, CNN ANCHOR: Happening now, breaking news, President Trump shares new details about his phone call with Vladimir Putin, their agreement to launch talks on ending the war in Ukraine. And their plans to meet face to face soon.

Also breaking, the new attorney general, Pam Bondi, is pushing back at Elon Musk, declining to support his call for a wave of judicial impeachments. Stand by for all the headlines from her first news conference over at the U.S. Justice Department.

And the White House blocks an Associated Press reporter from covering an event for a second day. The wire service punished for refusing to officially embrace Trump's renamed Gulf of America.

Welcome to our viewers here in the United States and around the world. I'm Wolf Blitzer. You're in The Situation Room.

Let's get right to the breaking news on President Trump's phone call with Vladimir Putin and what happens next, including his expected meeting with the Russian leader that's likely to happen in Saudi Arabia soon.

CNN's Fred Pleitgen is standing by for us live in Moscow, but, first, let's go to CNN's Jeff Zeleny over at the White House.

Jeff, first of all, tell us more about what the president just said about his phone call with Putin.

JEFF ZELENY, CNN CHIEF NATIONAL AFFAIRS CORRESPONDENT: Wolf, an extraordinary thaw in U.S.-Russian relations here beginning with that phone call that the president of the United States and the president of Russia had earlier today. I'm told it lasted about 90 minutes or so. So, even with translation, about 45 minutes aside, that is considered to be a very long phone call. And, of course, it is the first one that the U.S. and Russia have had at this level in about three years since the Russia invasion of Ukraine. There is no doubt here that the Trump administration wanted to reset relations. There's no doubt also, as we hear the president speak about this throughout the day. One person is on the sidelines, and that is Volodymyr Zelenskyy, the Ukrainian president, who's been at the center of so much conversation and diplomacy for the last three years, of course, in the halls of Congress, here at the White House as well. But the president made clear this first conversation would be between him and Vladimir Putin.

(BEGIN VIDEOTAPE)

DONALD TRUMP, U.S. PRESIDENT: No, we had a great call, and it lasted for a long time, over an hour, this morning.

I also had with President Zelenskyy a very good call after that. And I think we're on the way to getting peace. I think President Putin wants peace, and President Zelenskyy wants peace, and I want peace.

We had a very good talk with -- people didn't really know what President Putin's thoughts were, but I think I can say with great confidence he wants to see it ended also. That's good. And we're going to work toward getting it ended and as fast as possible. It's a horrible situation going over. It's flat land. And the bullet goes off and the only thing it can hit is a body, a human body, a young human body. And they're losing just tremendous numbers of mostly soldiers. The cities and towns have been largely demolished.

REPORTER: (INAUDIBLE)?

TRUMP: I think so. We think we're going to probably meet in Saudi Arabia the first meeting.

REPORTER: (INAUDIBLE)?

TRUMP: It hasn't been set, but not too distant future. We both understand, you know, we know the Crown Prince, and I think it'd be a very good place to meet.

REPORTER: So, it sounds like that would just be a meeting between you and Putin, and perhaps the Crown Prince, but not President Zelenskyy?

TRUMP: Probably, we'll have a first meeting, and then we'll see what we can do about the second meeting.

REPORTER: Are you freezing out President Zelenskyy of this process a bit? Isn't there a danger of that?

TRUMP: No, I don't think so. As long as he's there, but, you know, at some point you're going to have to have elections too.

REPORTER: Do you view Ukraine as an equal member of this peace process?

TRUMP: It's an interesting question. I think they have to make peace. Their people are being killed, and I think they have to make peace.

(END VIDEOTAPE)

ZELENY: The president calling an interesting question when asked if Ukraine is an equal part of this peace process. Well, if that is an extraordinary development here, just really over the last three years or so, an entirely different posture that the U.S. has had, of course, has lent Ukraine so much assistance.

[18:05:04]

There's no question the president wants to claw some of that back. It's one of the reasons he sent Scott Bessent, the treasury secretary, over to Ukraine.

But, Wolf, this is also coming on the exact day when Tulsi Gabbard was in the Oval Office. He was swearing her in there. He made those comments afterward. That is such a different development here because she was always accused of being a Russian sympathizer. Now, she's a member of his cabinet. Wolf?

BLITZER: The director of National Intelligence, indeed.

All right, Jeff, I want you to stand by over there at the White House, because there's some more breaking news coming into The Situation Room right now, a very significant legal win for the Trump administration. A judge ruling that Trump's so-called buyout plan for federal workers can proceed for now.

Let's go right to CNN's Paula Reid. She's watching all of this for us. So, what does the ruling say, Paula?

PAULA REID, CNN CHIEF LEGAL AFFAIRS CORRESPONDENT: Wolf, this is the first really big win for the Trump administration as it struggles to defend the president's executive orders and new policies in court. Here, a Clinton-appointed federal judge in Boston said that the administration can move forward with the federal buyout plan for workers, the so-called deferred resignation program.

Now, it was temporarily paused the deadline to accept that offer by this judge as he contemplated a lawsuit that was brought by several unions. But late tonight, the judge decided that those unions do not have what is called standing or the right to bring this case because they are not directly impacted. They are filing this lawsuit on behalf of their members. And in court, they argued that this buyout was not valid. They raised questions about whether the administration would actually be able to pay out workers who accept it.

They also said that the two weeks that workers were given to make this potentially life-changing decision, that that was not adequate. But here, he said that for now, this buyout plan can move forward. Like I said, this is one of the few wins that the Trump administration has had in court over the past few weeks amid about four dozen lawsuits they've faced over their new policies.

BLITZER: All right. I want to bring in our legal and political team to get some analysis of what's going on. And, Jeff Zeleny, you're over at the White House. Are you getting reaction from the White House to this legal win for the Trump administration?

ZELENY: Wolf, talking to an official just before we came on the air, they say they are pleased with this ruling, which they are still reviewing. But this certainly flies in the face of what even the White House press secretary said earlier today, really blasting the judges writ large, calling them a judicial activist. But that is a reminder of each of these cases are decided differently.

So, yes, this is a major case. And as Paula said, this would be the first win, the first big win for this White House.

Of course, this is at the very center of Elon Musk's plan to reshape and resize the government. And the pause on that, the federal buyout program, if that is lifted, which is that's what the judge is saying, that means a central part of this can go forward. We saw the president signing that executive order next to Elon Musk yesterday, really putting more directives in for every one person hired, four people have to be let go. The Musk team has to be at the center of all hiring.

So, Wolf, this is a major development indeed. Again, one White House official saying they are pleased by this ruling and they are still reviewing it tonight.

BLITZER: All right, stand by. I want to bring in our Senior Legal Analyst Elie Honig, who's with us right now.

Elie, what was the legal basis for this decision?

ELIE HONIG, CNN SENIOR LEGAL ANALYST: So, Wolf, really important to understand this legal decision has nothing to do with the actual constitutionality or proprietoriness of the actual buyout plan. Instead, this judge declined to put it on hold because of sort of technical reasons. First of all, the judge said the parties that brought the lawsuits here do not have standing. The party that brought the lawsuit here was a labor union representing federal employees. They said, you don't have enough of a direct stake as a labor union in this dispute.

And then the second problem, the judge pointed out is jurisdictional. The judge basically said there is a specific statutory regime here relating to federal labor relations that tells you how you have to proceed if you have this kind of complaint as a federal employee. You cannot actually come into the federal district court. So, those are the judge is finding, Wolf, I think it's important to note. This judge is a federal district court judge in Massachusetts. He's actually an appointee of bill Clinton from the 1990s.

BLITZER: interesting. Our Legal Analyst Elliot Williams, a former federal prosecutor, is also joining us right now. Elliot, so what happens next for the case?

ELLIOT WILLIAMS, CNN LEGAL ANALYST: Wolf, certainly the parties here are going to have an opportunity to appeal, and most importantly, Wolf, you know, it's important to know this is not the last that we have heard of this case in the federal courts. This is certainly a very important strategic and legal win for the president and the White House. But I think there are going to be more legal proceedings ahead of us.

[18:10:00]

I think I would assume that the parties that were deemed to not have standing will make an argument saying that they do, that their arguments should go forward.

And, you know, to Elie's point, this was a court in Massachusetts. You know, other suits can be filed in other federal courts around the country. So, this is certainly not the end of this, you know, of this matter here.

The other thing that I would note, it is striking that sometimes you win, sometimes you lose in the federal courts, and the tonal shift from the White House, you know, they're being very quiet right now after this victory here. And I'll be curious to see how they proceed with speaking about the court in light of this pretty big victory today.

BLITZER: We will find out. Everybody stand by.

I want to bring in Senator Chris Coons, Democrat of Delaware and a key member of the Senate Foreign Relations Committee right now. Senator, thanks for joining us.

First of all, what's your reaction to this federal judge saying the Trump administration can, in fact, move forward with this so-called buyouts for federal workers?

SEN. CHRIS COONS (D-DE): Well, Wolf, as your panel just made clear what that judge ruled was that the labor union that brought the case didn't have standing. That doesn't mean he said full speed ahead for President Trump's agenda here in terms of trying to interfere with contracts and employment. There was a big loss for the Trump administration in federal court yesterday, when the First Circuit Court of Appeals refused to stay an order by a district court judge in Rhode Island that said that the freezing of all federal grants domestically, something President Trump tried to do by executive order in his first day as president, could not go forward.

So, I and many other senators, Wolf, heard by phone from hundreds of my constituents that they were alarmed that the Trump administration was trying to freeze grants to state and local law enforcement, to fire companies, to senior centers, to daycares, to Head Start. And that court order in Rhode Island froze that order and it has now been upheld on appeal.

There are lots of different court actions going on to challenge what the Trump administration is trying to do. As your panel just said, you win some, you lose some, but the first circuit court to rule on a key issue here decided against the administration.

BLITZER: Interesting. On another topic, Senator, while I have you, as you know, President Trump says negotiations to end the Ukraine war will start, in his word, immediately following his, what, 90-minute phone conversation today with Putin, and he said this about their conversation. Listen to this.

(BEGIN VIDEO CLIP)

TRUMP: President Putin wants to have peace now, and that's good, and he didn't want to have peace with Biden. And you tell me why, that is, okay?

(END VIDEO CLIP)

BLITZER: So, Senator, do you think Putin wants peace right now?

COONS: I think Putin has murdered hundreds of thousands of Ukrainians in his brutal war that has occupied 20 percent of Ukraine, and in which Ukrainian soldiers have fought bravely and died. I think Putin's goal is to overtake all of Ukraine. That's been his goal since he began the full, broad invasion in 2022, and that's what I think he'll continue to pursue.

My hope is that President Trump will not simply abandon our partners in Ukraine. I am optimistic that in the end, senior leaders in this administration will persuade him that peace through strength, which is something President Trump often talks about, requires strength, not concessions.

And that if our European partners and allies, who have stood alongside us in arming Ukraine, in funding Ukraine, and supporting Ukraine, if we continue to do so, Putin will accept that he cannot overrun all of Ukraine. But that's the path forward.

If President Trump sells out Ukraine by giving up before they ever sit down at the table on Ukraine joining NATO, or on the United States continuing to support Ukraine's brave fight for freedom, then we're going to end up with chaos through weakness, not peace through strength.

BLITZER: President Trump said he actually called the Ukrainian President Zelenskyy to inform him about his conversation with Putin and was noncommittal when asked if he views Ukraine as an equal member of the peace process. What do you make of that?

COONS: It's the Ukrainians who have been doing the fighting and dying. Not Americans, not other Europeans. It's Ukrainians, soldiers and civilians who've been taking the fight to Russia and working relentlessly to retake their sovereign territory. So, bluntly, I think President Zelenskyy should be at the table and in the room.

President Biden often said we will negotiate nothing about Ukraine without Ukraine, and I think that is a good way for us to proceed going forward.

[18:15:02]

BLITZER: Senator Chris Coons, thanks so much for joining us.

And we're going to have much more on all the breaking news. That's coming up next.

(COMMERCIAL BREAK)

BLITZER: We're getting more reaction to a major breaking story, a federal judge allowing President Trump's so-called buyout plan for federal workers to continue for now.

Our political experts are joining us right now with some serious analysis. Jasmine Wright, is this a big win for President Trump, this federal judge allowing his so called buyout program for federal workers around the country to move forward?

JASMINE WRIGHT, REPORTER, NOTUS: Yes, Wolf. Well, the White House certainly thinks that it is. I talked to one official who said that they were still reviewing it, but they are really happy with this initial ruling.

Now, I've also reached out to the representative that represents the union that initially filed the suit, and they said that they're working on a response.

[18:20:02]

I would suspect that they would appeal whether or not the judge then does something in addition to that. I think it's, you know, kind of an open question. But I think that this is a win for the White House. I think not just people within the White House were becoming really frustrated with all of these injunctions put on what they call Trump's America first agenda, but certainly people outside of the White House, the MAGA movement really pushing the White House to kind of defy some of these court orders.

And so I think that this is going to be a really welcome reprieve for all are for the people at the White House who felt that the courts were kind of abusing their power overreaching when pausing or at least, you know, kind of stopping some of these things, like the federal freezes, like this buyout program, like some of the other initiatives that Trump has tried to push in the first three weeks in office.

BLITZER: Shermichael Singleton is with us as well. Shermichael, Trump has repeatedly, as all of us know, attacked judges who have ruled against him. But does this ruling show he should back off from that kind of talk?

SHERMICHAEL SINGLETON, CNN POLITICAL COMMENTATOR: Well, look, Wolf, the president stated, I believe, yesterday that he would respect the decision and go through the appellate court process. He said, and I respect judges and I think that was welcoming news for some of his detractors.

With that said, though. I think this is a great news, as Jasmine just stated, for the administration and for supporters of the president. A part of his argument and mandate has been to restructure and downsize the size and scope of government writ large. It doesn't make sense for us to bring in $4 to $6 trillion dollars, but we're spending $2 trillion more. And so part of that restructuring and downsizing is going to be shrinking the size of some of these agencies, letting go individuals who aren't necessary, and also looking at other ways you can save dollars.

And so I think the president has to win that his sails here, Wolf, and he's moving in the right direction.

BLITZER: Maria Cardona is with us as well. Maria, Democrats have, as you know, pinned a lot of their hopes of combating the Trump administration on the courts. Does this show the limits of that strategy?

MARIA CARDONA, CNN POLITICAL COMMNETATOR: Well, I think what it shows is that the courts are going to decide each of these cases on what is in front of them. And let's remember what this judge decided was not that this program was legal, which is what the labor unions had filed suit over. They contend that this program, the buyout program, is unlawful, that it is not legal, that all of these workers would be left holding the bag because OPM, the Office of Personnel Management, does not have the legal authority to implement this kind of buyout program.

So, this is not the end of this. But to your point, Wolf, yes, of course there are legal limits because the courts are there to make sure that what the administration does is legal, is lawful, that the lawsuit in front of them, the people who are bringing the lawsuit has standing. And this is what this judge decided that this group of people did not have standing.

That doesn't mean it's the end. I suspect there will be an appeal. I suspect that there might be the workers themselves will bring the lawsuit because they are the ones who are being affected by this. And so the courts are going to continue to be a check on what this administration is trying to do, and a lot of it is illegal. A lot of it is unconstitutional, which is why you're seeing courts in a frenzy, trying to make sure that this administration does not shred the Constitution and does not move forward like an imperial presidency, which they believe they have, and that no one has the right to check and balance them, and that's just not true.

SINGLETON: I mean, well, if I can just rebut some of what Maria was saying, Democrats need to come up with some new messaging. To say that everything is unconstitutional, that they disagree with when we have not seen a ruling from a judge dictating that the actions of the executive are yet considered unconstitutional, we don't know we need to allow the process to work itself through.

But what we do know of is that the American people look at the massive amount of money that this federal government spends and they expect the newly elected president to do something about it. We can't say the same thing about our Democratic friends on the other side of the aisle.

BLITZER: All right. Guys, everybody stand by, we're going to continue this conversation, but there's other news we're following as well. I want to get back to our top story involving the presidents of the United States, Russia and Ukraine, with new insights into phone calls today and the future of Moscow's war on Kyiv.

(COMMERCIAL BREAK)

[18:25:00]

BLITZER: The breaking news tonight, President Trump says he and Vladimir Putin will meet face-to-face very soon, likely in Saudi Arabia. Right now, let's get more on the readout from Russia on today's Trump-Putin phone conversation and their agreement to launch talks to end the conflict in Ukraine.

CNN's Fred Pleitgen is on the ground for us in Moscow. What's the Kremlin saying, Fred?

FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT: Hi there, Wolf. Well, it's clear that the Kremlin's very happy with the way that the talk went down, the phone call went down between President Trump and Russian President Vladimir Putin. In fact, the Kremlin spokesman, Dmitry Peskov, texted me after that call took place and said that he found the call to be very constructive and positive also. So, the Russian side certainly quite pleased with what happens. You feel that in political Russia as well with some of the comments that we're hearing.

The Russians confirming a lot of the things that President Trump said about that call, that the atmosphere was one that was very warm, that both leaders invited each other to each other's countries for visits there.

[18:30:05]

A couple of interesting things, Wolf, that we picked up on from the Russian side is that they say that they would be okay with U.S. officials coming here to Moscow to talk about various issues, including possibly solving the Ukraine crisis, ending the war in Ukraine. So, some of those negotiations could actually be happening here in the Russian capital as far as the Russians are concerned.

One other interesting point is the Russians say that when it came to the war in Ukraine, that the Russian leader, Vladimir Putin, spoke about eradicating the root causes, as he put it, of the war in Ukraine. And that's something that indicates from the Russian side that some of these negotiations might be a little bit tougher than President Trump has been letting on before taking office, of course, also after taking office as well.

The Russians in the past couple of days have been speaking a lot about red lines that they have. A lot of that pertains to some of the territory that they've taken in Ukraine, the new realities on the ground, as they put it, but also some of that territory inside of Russia that Ukrainian troops are currently holding. In fact, The Kremlin spokesman, Dmitry Peskov, also saying today that the Russians still want to oust the Ukrainians from that territory militarily. He says he does not want that to be part of any sort of negotiations going forward.

Nevertheless, the mood here on the ground, Wolf, after this phone call took place, is that for the Russian side it was very positive, and they do believe that diplomacy will start very soon. Wolf?

BLITZER: And we'll see what happens at that face to face meeting that's upcoming in Saudi Arabia between these two presidents.

Fred Pleitgen, thanks very much for that report.

We're digging deeper right now in the new context between Presidents Trump and Putin. CNN's Brian Todd is working this part of the story for us.

Brian, is the so-called bromance these two leaders appeared to enjoy during Trump's first term back on?

BRIAN TODD, CNN CORRESPONDENT: It looks like it's back on with a vengeance, Wolf. President Trump seems to be picking up right where he left off with Vladimir Putin, despite all the criticism that Trump faced over his dealings with Putin during his first term.

(BEGIN VIDEOTAPE)

TRUMP: We had a great call, and it lasted for a long time.

TODD (voice over): President Trump sounding confident after a nearly 90-minute call with Vladimir Putin, saying he and the Russian president agreed to work together to try to end the war in Ukraine, and --

TRUMP: Do we expect that he'll come here and I'll go there?

TODD: -- Trump once again embracing a relationship fraught with potential danger.

RICHARD HAASS, PRESIDENT EMERITUS, COUNCIL ON FOREIGN RELATIONS: The phase in which Vladimir Putin was a pariah from the American perspective, that seems to be over.

TODD: Trump's predecessor, Joe Biden, had not even spoken to Putin in almost three years. And an American president hasn't set foot in Russia since Barack Obama went to a G20 summit in St. Petersburg in 2013. But Trump's approach to Putin has always been distinct.

EVELYN FARKS, EXECUTIVE DIRECTO, THE MCCAIN INSTITUTE: We have seen time and time again that he has tried to somehow stay on the good side of President Putin.

TODD: That dates back to before Trump was first elected president, when he touted his ability to strike deals with the former KGB lieutenant colonel.

TRUMP: I think I'd get along very well with Vladimir Putin.

TODD: Part of that mindset, analysts say, stems from Trump's affinity for strongmen.

MAX BOOT, SENIOR FELLOW, COUNCIL ON FOREIGN RELATIONS: Trump has seemingly never met a dictator he doesn't like, and not just like, but he seeks to emulate, which is the scariest thing of all.

TODD: But many analysts believe Putin has played Donald Trump from the start, with flattery and favors, deftly using his training as a spymaster.

SAMUEL CHARAP, SENIOR POLITICAL SCIENTIST, RAND CORP.: He does at least reportedly employ some of the tactics he learned when he was in the KGB, in terms of assessing trying to find weaknesses in those who he's talking to and trying to exploit them.

TODD: Helsinki, July 2018, at a high stakes summit, Trump inexplicably let Putin off the hook for Russia's 2016 election meddling.

TRUMP: I have great confidence in my intelligence people, but I will tell you that President Putin was extremely strong and powerful in his denial today,

BETH SANNER, FORMER TOP INTELLIGENCE OFFICIAL UNDER TRUMP: that was the kind of thing where Putin was able, I think, in some ways to very craftily control the room.

TODD: Trump has denied being a mark for Putin's manipulations.

HILLARY CLINTON, FORMER SECRETARY OF STATE: He'd rather have a puppet as president of the United States.

TRUMP: No puppet.

CLINTON: And it's pretty clear --

TRUMP: You're the puppet.

TODD: How might Putin try to shape the relationship this time around?

FARKAS: I think that president Putin will try to convince President Trump that he doesn't need the international order, that they can just make deals, the two of them, and leave the rest of the world out of it.

(END VIDEOTAPE)

TODD (on camera): Evelyn Farkas warns that if President Trump lets that happen, it will embolden other strongmen to take dangerous actions and simply try to negotiate it all with the president directly. She points to Chinese Leader Xi Jinping and the provocative moves he could make with Taiwan and in the South China Sea. Wolf?

BLITZER: Lots going on right now. All right, Brian Todd reporting for us. Thank you very, very much.

Just ahead, there's breaking news from the U.S. Justice Department. [18:35:00]

The new attorney general is suing the state of New York. We'll explain, that's next.

(COMMERCIAL BREAK)

BLITZER: All right. There's breaking news out of the US Justice Department right now. CNN's Evan Perez is on the scene for us. He's got details.

Evan, I understand the new attorney general, Pam Bondi, just held her first news conference over where you are. What can you tell us about the lawsuit she announced against the state of New York?

EVAN PEREZ, CNN SENIOR JUSTICE CORRESPONDENT: That's right, Wolf. This is part of a new aggressive push by this Justice Department going after jurisdictions, cities, and states that have so-called sanctuary laws. These are laws that prohibit local authorities from cooperating with federal immigration authorities, and, of course, immigration being a huge part of the Trump administration's agenda this time around.

Here's the attorney general describing this lawsuit, which we have not yet seen, but it appears to go after New York for various laws, various sanctuary laws that it says that she says prohibit their cooperation with the feds.

[18:40:10]

Listen.

(BEGIN VIDEO CLIP)

PAM BONDI, ATTORNEY GENERAL: If you don't comply with federal law, we will hold you accountable. We did it to Illinois, strike one. Strike two is New York. And if you are a state not complying with federal law, you're next. Get ready.

(END VIDEO CLIP)

BLITZER: And, Wolf, the attorney general -- again, we haven't seen this lawsuit, but the attorney general says that they're not going to stop with New York. They're going to look at other jurisdictions around the country because they say they want these cities to provide cooperation with immigration authorities to get more illegal immigrants out of this country. Wolf?

BLITZER: Attorney General Pam Bondi was also asked a question about impeaching federal judges. What did she say, Evan?

PEREZ: Yes. This was an interesting question because she was asked about comments by Elon Musk, who has been on his Twitter website talking about the need to impeach judges that have been blocking some of the early parts of the Trump agenda. And she said that is taking it too far, at least at this point. Listen to her comments. (BEGIN VIDEO CLIP)

BONDI: That's not going to happen now. We're going to look at everything. We're going to follow the law right now. We're going to follow the process. These are federal judges with lifetime appointments, but they will be struck down, ultimately, by the Supreme Court of the United States if the appellate courts don't follow the law as well.

(END VIDEO CLIP)

PEREZ: And, Wolf, she said that she is confident that the Justice Department will succeed after appealing some of these losses, these early losses. Of course, earlier this hour, you heard that at least one of the judges has already reversed course on those so-called buyouts that the administration is trying to do. So, perhaps that will change the narrative about the legal fights. Wolf?

BLITZER: Evan Perez over at the Justice Department for us, Evan, thank you very much.

CNN Senior Legal Analyst Elie Honig is back with us. Elie, walk us through what we know and do not know about the Department of Justice's actions against the state of New York and New York state officials.

HONIG: So, Wolf, first of all, this is not a criminal case. This is a civil lawsuit. And there might be some misunderstanding, because in the very first sentence that she spoke today, the attorney general, Pam Bondi, said she had, quote, filed charges against Kathy Hockel and Letitia James and others. Now, ordinarily, that type of terminology suggests criminal charges, but that was a bit misleading. This is a civil lawsuit brought against the state level officials in their official capacity.

And what DOJ is seeking here is not money. They're seeking an order from the judge that New York's state and local sanctuary city's policies are unconstitutional and unfairly undermine DOJ's efforts to enforce immigration law. So, they're looking for a judge to basically order New York state officials to stop enforcing their state laws.

BLITZER: Can you lay out for us, Elie, the legal basis for what the Department of Justice is requesting?

HONIG: Yes. So, as Evan said, we have not seen the actual complaint yet, but based on prior complaints, similar in nature, I think DOJ is going to be looking at two things. One, they're going to argue preemption, which is the idea that in certain areas of law enforcement or regulation, that's for the feds only. Immigration is actually a pretty classic example of something where the feds can come in and preempt, essentially kick out the state authorities.

The other thing that I think the DOJ is going to argue is what's called the supremacy clause, which essentially says, if there's a conflict between what the federal government's trying to do and what state or local governments are trying to do, generally speaking, the federal government should prevail and get its way. BLITZER: Is there any precedent here?

HONIG: So, there have been all sorts of lawsuits between federal and state officials over the years, but there are a few interesting precedents. First of all, as the attorney general mentioned in her press conference just last week, DOJ filed a very similar lawsuit against state officials in Illinois. And I think it's important to note that during Donald Trump's first term in office under Attorney General Jeff Sessions, a similar complaint was filed by DOJ against California state officials.

Now, that case ultimately went through the court process, and, ultimately, DOJ's lawsuit was rejected by a federal court of appeals in the Ninth Circuit. They actually found that the state of California was allowed to continue enforcing its own sanctuary city and sanctuary state laws.

Now, those were a slightly different set of laws than we're talking about in New York here, and that was a different circuit than were in here, but there is a bit of precedent on the issue.

BLITZER: Interesting. All right, Elie Honig, I appreciate the analysis. Thank you very much.

Coming up, the stock market is down, prices are up after a surprising report out today showing inflation in the United States on the rise.

(COMMERCIAL BREAK)

[18:49:01]

WOLF BLITZER, CNN HOST: On Wall Street tonight, stock prices sliding after a hotter than expected inflation report. The Dow Jones Industrials closing down about 225 points.

Inflation unexpectedly surging to 3 percent last month. That's the highest level since June. Prices driven up by the rising cost of food, including a whopping 15 percent jump in egg prices.

CNN economics and political commentator Catherine Rampell is joining us right now. She knows a lot about all of this.

Catherine, president Trump has been in office just over three weeks now. And as you know, he repeatedly said he would bring prices down. He said starting on day one.

So how much is he responsible for this new rise in prices?

CATHERINE RAMPELL, CNN ECONOMICS AND POLITICAL COMMENTATOR: It was always a dumb idea for Trump to promise to bring prices down. The price level almost never turns downward in an economy. If that does happen, it usually means that the economy is very sick. Think like Japan in the 1990s or the United States during the Great Depression.

[18:50:04]

It doesn't happen.

What economists are hoping for and that Trump did not give credence to, is that basically, prices should stop growing as quickly. They should plateau. That's the goal here.

Obviously, we have seen the opposite happen, and I don't blame Trump. Presidents don't have control over prices. As you pointed out, bird flu is a large part of the culprit here with egg prices going up and that was going on before Trump took office. Not that Republicans let President Biden off the hook at the time when egg prices were going up.

But I will say there are a lot of things that Trump has done or is threatening to do that are making the problem worse. I mean, just with the example of bird flu, the CDC has suppressed at least three different studies on bird flu transmission that were scheduled to come out and that that haven't come out because Trump has put basically a gag order on a lot of communications from the CDC, you know, not to mention the threatened trade wars and deportations, which would make things worse as well.

BLITZER: Very significant indeed. President Trumps plan to lower prices is in part centered on producing more oil to lower energy costs. He keeps saying drill, baby, drill.

He says that that will defeat inflation. Will that work? And how does he do it?

RAMPELL: Well, we've already been drilling record amounts of oil per day in the United States. More oil, in fact, than any country on earth has ever drilled. That was happening already under Joe Biden.

Again, I'm not crediting or blaming particular presidents for that. That's -- those kinds of trends are about broader, broader macroeconomic factors.

Now, it's worth noting that Donald Trump's own donors in the fossil fuel industry have basically dismissed his calls to drill, baby, drill, or at least to drill more baby in the sense that, you know, oil prices have already, you know, been -- been close to their break even point. Anyway, for these companies to make money, they don't want to rapidly increase the supply of oil because that will hurt their bottom lines.

What they are hoping for Donald Trump to do instead is to prop up demand, not to increase supply. So there's not a whole lot he can do. There's not a lot of incentive in the market to do it. The only thing that would increase or the most likely force anyway, that would increase oil production here in the United States, beyond what it's already been, is some major disruption in the rest of the world, right?

If you have major disruptions, again, because of geopolitical consequences, as we've seen already with Russia, that might induce more supply here, but its just all going to even out. It's not going to actually bring prices down for U.S. consumers, because oil is a global market.

And besides, if you look at today's inflation report, the culprit is really not about energy prices. It's about eggs. It's about other weird things like auto insurance. It's about bacon. It's about coffee. Coffee prices are skyrocketing. Rent is still too high to quote a famous philosopher.

So it's not clear that even if he could do this, it would have the effect that he has promised to lower prices.

BLITZER: Excellent analysis, Catherine Rampell, thanks very much for joining us.

Coming up, new headlines tonight over Republicans versus Republicans in the battle over keeping the government funded.

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BLITZER: On Capitol Hill tonight, Republican hardliners are threatening a revolt that could jeopardize GOP leaders' plans to jump- start President Trump's agenda in Congress.

CNN's chief congressional correspondent Manu Raju is up on Capitol Hill. Manu, tell our viewers what you're learning.

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Yeah, this is an effort to try to get Donald Trump's agenda moving everything from tax legislation to overhaul the tax code, new immigration restrictions, as well as sweeping energy policy. Put it into one bill, get it through the House, get it through the Senate.

But there are divisions, not just between the House Republicans and Senate Republicans, significant divisions there, but also within the House GOP ranks. And in talking to Republicans today, they are demanding deeper spending cuts than what the speaker is proposing. As others are saying, it's going too far.

(BEGIN VIDEO CLIP)

REP. ANDY OGLES (R-TN): As it stands, I think it falls short. And so but it's a work in progress and we'll -- we'll just keep working on it.

RAJU: If it doesn't change, could you vote for it?

OGLES: I would say right now, based off the folks that I've talked to, the votes are not there to pass it as is.

UNIDENTIFIED MALE: I'm not happy with the number of cuts.

REP. NICK LALOTA (R-NY): The president has said he doesn't want to cut Medicaid. And now, it's up to us in the House and the Senate to figure out how to actually put pen to paper on these important issues.

(END VIDEO CLIP)

RAJU: So you heard there a division within the ranks, some Republicans saying it should go deeper than the spending cuts being proposed. Others warning that if they cut more, say, on the issues of Medicaid, then that could cause some support from the middle of the House GOP conference. And there's a delicate balance there, which is critical for the speaker, who could really only lose one Republican vote to advance this plan. Now, Wolf, this also comes as the House and the Senate have much different proposals.

In the Senate plan, it only seeks about several billions of dollars worth of cuts. But in the House plan, they're seeing $1.5 trillion in spending cuts as some of the far right want even deeper spending cuts than that.

And also the tax overhaul, the overhaul of the tax code, $4.5 trillion is the price tag for that. That is not even dealt with in the Senate plan. They say deal with that later. Let's deal with immigration and other issues first. And the immigration price tag different between the Senate and the House, $342 billion in the Senate, much -- a little bit less in the House.

So there is a lot of questions, Wolf, here tonight about whether the House and Senate can be on the same page and whether the speaker can get his proposal out of the House to begin with. Uncertain as he faces unrest within the ranks.

BLITZER: March 14th, as the deadline for the House and Senate to approve this new funding to keep the government open. Manu Raju up on Capitol Hill, thanks very much.

And to our viewers, thanks very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.