Return to Transcripts main page

The Situation Room

Trump Announces South Korea Trade Deal Before Deadline Tomorrow; Russia Launches Deadly New Wave of Strikes on Kyiv; NTSB Investigating After Severe Turbulence Forces Delta Plane to Make Emergency Landing in Minneapolis. Aired 10-10:30a ET

Aired July 31, 2025 - 10:00   ET

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

(COMMERCIAL BREAK)

[10:00:00]

WOLF BLITZER, CNN ANCHOR: Happening now, new trade deals, higher tariffs, and a looming deadline. We're tracking the flurry of 11th hour activity amid President Trump's trade war.

Plus, terrifying turbulence on a Delta flight, two dozen people taken to the hospital as passengers who weren't wearing their seat belts, hit the ceiling and carts bounced around the cabin.

Welcome to our viewers here in the United States and around the world. I'm Wolf Blitzer. Pamela Brown is off today, and you're in The Situation Room.

We begin this hour with the clock ticking on trade deals. President Trump's self-imposed tariff deadline is just 14 hours away. Without deals the tariffs on multiple countries will soar. The president says he's reached the trade agreement with South Korea, which includes a 15 percent tariff on goods from there. The Trump administration also announcing deals with Cambodia and Thailand. We're awaiting details on those. The U.S. has yet to reach a deal with some of its biggest trading partners, including Mexico and Canada.

We're covering this story with CNN Senior Reporter Matt Egan and our White House Reporter Alayna Treene.

Matt, let me start with you. What are the latest deals? What's going on?

MATT EGAN, CNN SENIOR REPORTER: Well, Wolf, there's been a flurry of activity over the last 24 hours or so, new tariff threats and frameworks are coming out rapid fire. But U.S. officials say they have reached framework agreements with a number of countries in the last day or so, and that includes Thailand, Cambodia, South Korea, and Pakistan.

Now, this, of course, is on top of the broader list of countries that have reached frameworks with the U.S., including the United Kingdom, Vietnam, Philippines, Indonesia, Japan, and the European Union.

Now, we should note that these are not text-heavy agreements that run hundreds of pages like you would normally expect in a trade deal. These are often just Truth Social announcements. Sometimes there's fact sheets from the White House. But we really don't know a lot of the details. What we do know, though, is that dozens of countries have not reached a framework agreement with the United States, and that does include major trading partners such as Canada, Mexico, Taiwan, India and Brazil. The president has threatened significantly higher tariffs on those countries.

And the president is expected to announce a new baseline universal tariff that would apply to countries that have not reached a framework agreement. That universal tariff, it's currently at 10 percent, but the president has suggested it could get doubled, Wolf, to 20 percent.

BLITZER: All right, Matt, stay with us. I want to bring in Alayna into this conversation. Alayna, the president is clearly escalating the trade war with Canada over its decision to recognize a Palestinian state. Tell our viewers what the president is now saying.

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Yes. Essentially, Wolf, he's kind of throwing politics into this, not just, you know, his talk of how a lot of these tariffs are based on what he argues are unfair trade practices toward the United States. This is where politics comes in. He said early this morning that it would be very hard to reach a trade deal with Canada after the country had said it planned to recognize a Palestinian state, really throwing talks with Ottawa just one day before, really, hours before this deadline is supposed to go into effect at 12:01 A.M. tomorrow.

Now, the president posted on social media. He said, wow, Canada's just announced that is backing statehood for Palestine. That will make it very hard for us to make a trade deal with them. Oh, Canada.

Now, I would also mention that Canada isn't the first to do this. He's joining France and the U.K. and saying that he's announcing these plans to recognize a Palestinian state in September at the United Nations.

But, look, I think what's been going on with Canada has been really striking to a number of people and not totally surprising now, but definitely surprising when you look at what has happened over the last several months because Canada's one of the United States' closest allies and they have long been. And we know that the president, but also the new prime minister, Mark Carney, have really been working hard to try and scramble to get some of these details out and hammer out a trade agreement.

While there's still just hours left to go, Wolf, it doesn't seem like that's in the cards as of now, but I'm told by my conversations here with people at the White House that it could still happen after the fact.

[10:05:05]

So, stay tuned for that.

BLITZER: We will stay tuned. And, Matt, I know you're following other breaking news on consumer spending and inflation here in the United States. What are you learning?

EGAN: Well, Wolf, new numbers that were put out today show that consumer spending, it did rebound during the month of June after flat- lining in May. And that is important because consumer spending is the biggest driver of the economy, but economists, they do note that spending remains soft.

Now, the other big news is inflation. This is the Fed's go-to inflation metric and it heated up. It went in the wrong direction, showing that prices increased by 2.6 percent year-over-year. That is a four-month high. That is a move away from the Fed's 2 percent goal. So, what does this mean? Well, it means your paycheck is not going as far. It also means that Fed officials, they may have second thoughts about whether or not they want to lower interest rates because inflation is still too high.

Now, the report doesn't break down exactly what kind of impact tariffs had, but we do know that prices for goods, durable goods, ones that are often exposed to tariffs, they did heat up. And we also know a growing number of companies have said that they're going to raise prices because of tariffs, everyone from Procter and Gamble and Best Buy to Nike, Adidas, and Ford.

And so I do think, Wolf, the bottom line here is a lot of American voters last fall, they wanted the president to fix inflation. But these new numbers, they don't show that it's getting better. They actually suggest that the cost of living is getting worse.

BLITZER: All right. Matt Egan and Alayna Treene, to both of you, thank you very much. We'll stay in very close touch with both of you.

Also new this morning, the situation in Ukraine, an urgent search underway right now for survivors in the capital city of Kyiv after Russia's latest wave of strikes in its summer offensive. Listen.

This was the scene as Russian drones and missiles rained down on 27 sites across the city. Officials say a young boy and his mother were among several people killed, and at least one survivor was pulled from the rubble.

CNN's Chief International Security correspondent Nick Paton Walsh is in Eastern Ukraine for us today. Nick, Russia claims its forces have captured a key Ukrainian town as part of this summer military offensive. What more do we know?

NICK PATON WALSH, CNN CHIEF INTERNATIONAL SECURITY CORRESPONDENT: Yes, look, health (ph) warning here, the Russians often claim to have captured places ahead of that actually being the case, but often it is a matter of time between that claim and it actually being realized. And indeed, they say today that they -- the Russian Minister of Defense says they've captured Chasiv Yar.

Now, that's not a place many of us never heard of before, but on the eastern frontline, it is utterly vital. It's a hill that the Russians have tried to take for well over a year and may now, they say, have had some success.

Ukrainian officials pushing back on that, saying their troops are still inside the area, and that a video of a Russian flag going up is essentially a fake film elsewhere. But this marks more bad news for Ukraine along that eastern frontline.

Look, we used Wolf to talking about incremental gains by Russia of places few of us had ever heard of, tiny villages, but that's in the last few weeks begun to mount into something significant, strategic and possibly irreversible. Along that eastern frontline, the town of Pokrovsk, we were near it last night at a stabilization unit for Ukrainian troops. We could hear the frequency of the drones flying over us, hitting Ukrainian targets, hearing constantly from Ukrainian soldiers that, look, they're worried their troops are surrounded in there. The supply lines will soon be cut and they'll have to pull out. Russia's been trying to get that town for months. It may do so in the days ahead.

To its north, Kostiantynivka, we were there a few days ago, under heavy pressure too, and also at risk of encirclement. That town itself hit by Russian drones.

And to the north, Kupyansk, another place we're not all familiar with, but still at risk now of being cut off too.

All along that frontline, if you add Chasiv Yar to it, consistent bad news and a sign that Russia's summer offensive, its massive application of resources, is beginning to pay off at a time of Ukrainian uncertainty about its western allies, arms slipping, real manpower crisis. One commander saying they had to, in one occasion, sometimes use two people at each Ukrainian position to hold Russians back and as many drones as they can.

The overnight assault we saw on Kyiv using about 300 drones, not a large number by today's standards, but it designed to overwhelm air defenses, caused terror throughout the night for Ukrainians. I can't tell you how many times we hear the air raid sirens going off here. A six-year-old boy, he died in an ambulance on the way to get yet more help, nine dead in total. One apartment block, it seems, hit primarily.

[10:10:01]

And also too in the last hour, as we've heard that Kramatorsk, one of the remaining towns that Ukraine has a proper hold on out in the Eastern Donetsk area, a key goal for Vladimir Putin to take that whole area, well, that was hit, Kramatorsk, by a massive airstrike, killed at least one, demolishing a five-storey building.

No mistake now at a time of President Donald Trump giving a lengthy deadline, now a shorter one, his next steps very key, Putin is, regardless, pressing ahead with a pretty successful ground offensive so far, and these aerial assaults every night, terrifying ordinary Ukrainian civilians and killing a child, six years old, last night. BLITZER: Yes. Putin and the Russian military clearly not deterred by all the threats coming from President Trump, at least for now.

Nick Paton Walsh on the scene for us in Eastern Ukraine, stay safe over there, Nick. Thank you very, very much.

Also new this morning, federal investigators are now looking into a Delta flight that hit severe turbulence suddenly last night. 25 people were taken to hospitals after the plane made an emergency landing in Minneapolis.

CNN's Brynn Gingras is following all of this for us. What are you learning, Brynn?

BRYNN GINGRAS, CNN CORRESPONDENT: Yes. I mean, Wolf, that plane taking a terrifying rollercoaster effect in the air about 40 minutes after it took off for that flight to Amsterdam from Salt Lake City, about a nine-hour flight in total, but it got diverted into Minneapolis, as you said.

What we're hearing really from data is that, again, 40 minutes into that flight, the plane really just got rocked, basically going up in the air a thousand feet in 30 seconds, and then going down more than a thousand feet 30 seconds later, again, making that rollercoaster effect.

I want you to hear what one passenger, how this one passenger described what that felt like.

(BEGIN VIDEO CLIP)

LEEANN CLEMENT-NASH, PASSENGER: If you didn't have your seatbelt on, everyone that didn't -- they hit the ceiling and then they fell to the ground, and the carts also hit the ceiling and fell to the ground. And people were injured and it was -- and it happened several times. So, it was really scary.

(END VIDEO CLIP)

GINGRAS: One passenger also telling CNN that because of the force of this, they could actually feel themselves lifted off their seat for several seconds.

Now, again, this flight did land safely in Minneapolis. There were emergency crews that rushed to this plane to provide care there at the gate. 25 people, we're told, were brought to the hospital with varying injuries. What we're understanding, though, is that most of those people have already been released from the hospital, Wolf. And if you can believe it, we talked to some passengers who said they were already ready to get on another flight to get to their final destination in Amsterdam. Wolf?

BLITZER: And an important lesson for all flyers, wear your seatbelt. Even if the flight is smooth, you never know when there's going to be turbulence. Keep that seatbelt on all the time.

Brynn Gingras, thank you very, very much for that report.

Also new this morning, a manhunt across Arkansas ends with an arrest at a barbershop. Here's the moment authorities closed in on the man they think killed a couple who were hiking with their two young daughters.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Well, it's going to be a haircut and beauty shop.

UNIDENTIFIED FEMALE: 10-4.

UNIDENTIFIED MALE: Well, we're going to have one detained.

UNIDENTIFIED FEMALE: Do you still need troopers on the interstate to BOLO?

UNIDENTIFIED MALE: I think we're good for now. Well, I think we've got what we were looking for.

(END VIDEO CLIP)

BLITZER: 28-year-old Andrew James McGann is now facing criminal capital murder charges for the weekend attack. The victim's daughters both survive, thank God for that.

CNN's Diane Gallagher is following the story for us. Dianne, I take this has shaken people in Arkansas, in fact, around the country. Law enforcement officials were getting emotional when they announced the arrest. What more can you tell us about this suspect?

DIANNE GALLAGHER, CNN NATIONAL CORRESPONDENT: You know, Wolf, a days- long manhunt for a double murder suspect ended when an elementary school teacher went to get a haircut. It is such a chilling sentence to say, especially when you consider that Andrew McGann was arrested not far from Devil's Den State Park, where Clinton and Cristen Brink were attacked and killed while they were hiking with their seven and nine-year-old daughters. Their daughters, of course, were unharmed. They are now safe with family.

Now police have not said at this point what led them to McGann to arrest him. They also say they're still working to determine a motive. They haven't revealed exactly how the Brinks were killed at this point, but they say that McGann had moved to the area recently to take a job at a local school. They say that last year he worked as a fifth grade teacher in Oklahoma. The Broken Arrow Public Schools District confirmed to CNN-affiliate KOKI. They said he, quote, left on his own accord to work out of state and noted that he did pass a background check before he was hired.

Now, McGann was arrested mid haircut at Lupita Beauty Salon, a barbershop in Springdale. The owner said in a Facebook video that her granddaughter was cutting his hair when police came in and asked who owned the car in the parking lot.

[10:15:00] That's when they arrested him. She said that they even gave him some of his -- they gave the police some of his hair on the floor for evidence.

Wolf, I do think it's important to point out that police said that video submitted by the public helped identify McGann. He is currently being held in jail, according to online court records. He has a first appearance tomorrow. CNN has not been able to determine if he has an attorney.

BLITZER: That's so heartbreaking. The seven and nine-year-old little girls are now going to have to grow up without their mommy and their daddy.

Dianne Gallagher, thank you very much for that update.

Also happening this hour, the second day of hearings into that January midair crash near Reagan National Airport here in the nation's capital. 67 people were killed when a U.S. Army Black Hawk helicopter collided with an American Airlines jet that was coming in for a landing.

CNN Aviation Correspondent Pete Muntean's over at the NTSB headquarters. Pete, what new details are we learning from today's hearing about this horrible crash?

PETE MUNTEAN, CNN AVIATION CORRESPONDENT: A lot of bombshells today, in this second day of this hearing of huge and unprecedented scope. We just heard from the operator of medevac helicopters, privately-run medevac helicopters here in the D.C. area, that he says that his crews were uncomfortable anytime the Army's 12th Aviation Battalion was flying in the D.C. area. That is the unit that was operating the Black Hawk that fateful night, January 29th, when this midair collision occurred.

We also got some pretty interesting details yesterday. And the biggest revelation was that there were errors in the altimeters fleet-wide on the Army's Black Hawk fleet of the 12th Aviation Battalion showing that the pilots were lower than they actually were, about an 80 to 130-foot error, meaning that that flight could have conceivably been higher than the 200-foot altitude limit on that helicopter route near Reagan National Airport, known as Route 4.

We've also learned from the transcript of the cockpit voice recorder onboard the Black Hawk helicopter that the pilot's in the final moments before this collision discussed changing course. This was a training flight. The instructor pilot on board said, come left for me, ma'am. And the pilot responded, okay, fine. Then less than a second later, the noise of a collision can be heard.

Also, this occurred late in the hearing yesterday, that crews essentially admitted from the Army to regularly flying under flights on approach descending into Reagan National Airport. I asked NTSB Chair Jennifer Homendy if that signals a cultural problem in the Army Aviation Brigade. Listen.

(BEGIN VIDEO CLIP)

JENNIFER HOMENDY, CHAIR, NATIONAL TRANSPORTATION SAFETY BOARD: It seemed very common when we interviewed Army personnel out of the 12th Battalion.

MUNTEAN: You're upset, angry?

HOMENDY: Absolutely. It could have happened any other time. 67 people died. Why did it take 67 lives to be lost and families who are just destroyed forever to understand what was occurring?

(END VIDEO CLIP)

MUNTEAN: The testimony here has been very technical and tough. We saw the 11-minute long video yesterday of the recreation of the crash, including the flight pads and the air traffic control audio. Right now, the focus, Wolf, is on air traffic control procedures in the tower and the procedures that airplanes use when communicating with air traffic control and helicopters, notably, around Reagan National Airport. Wolf?

BLITZER: So, so sad indeed. And as we all know, Pete, Reagan National Airport here in Washington is very, very close to the Pentagon. When I was a Pentagon correspondent for CNN, what, some 30 years ago or so, I used to see helicopters flying over the Pentagon all the time. And then I would see planes beginning their landing towards Reagan National Airport, not very far away. This has been going on for a long time, right?

MUNTEAN: A long, long time, Wolf. And the real thing here is that the 12th Aviation Battalion's mission was for continuity of government. And they say that that was the reason for them to turn off their specific technology called ADSB. It provides a better, a clearer picture for air traffic controllers where the helicopters are in real- time. That is something that is coming up in a big way today. We will see if the Army continues to take it on the chin here, Wolf.

BLITZER: Yes. They have to stop flying those helicopters near a major airport like Reagan National Airport.

Pete Muntean, thank you very, very much.

And still ahead, the U.S. special envoy, Steve Witkoff, just wrapped up a meeting with the Israeli prime minister, Benjamin Netanyahu, as pressure is growing and growing on Israel amid the starvation in Gaza.

[10:20:02]

And the clock is ticking toward President Trump's midnight trade deadline. We'll take a closer look at what could happen to your wallet if countries can't make a deal with the Trump administration.

Stay with us. You're in The Situation Room.

(COMMERCIAL BREAK) BLITZER: New developments as the clock ticks toward a midnight trade deadline, President Trump announcing a new deal with South Korea with a 15 percent tariff on goods coming into the United States from South Korea. Trump says South Korea will give the U.S. $350 billion for investments owned and controlled by the U.S., and, quote, this is what Trump says, selected by myself, end quote.

[10:25:04]

This comes as the president's tariff authority is now being tested in court today and during a critical week for the U.S. economy.

CNN Global Economic Analyst Rana Foroohar is joining us right now. Rana, what have we learned so far about where the economy stands for most Americans?

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: Well, it's interesting, you know, I would've expected there to be a lot more volatility in the run up to these trade deadlines. You know, we are going to have a big week. There's going to be more data coming in. But so far, I think what you're seeing is that things are pretty strong.

And, you know, it's interesting because it really does give Trump the upper hand in a lot of the negotiations that he is continuing with right now. The fact that the U.S. economy has been kind of Teflon, really, says a lot and it is really lying a lot of the predictions that people had at this time.

BLITZER: How would you evaluate, though, Rana, the trade deals that President Trump has announced at least so far, like with South Korea, the European Union, Japan, just ahead of Friday's deadline? What countries still remain and how high are the stakes right now?

FOROOHAR: So, there's two blocks that we're watching closely, Canada and Mexico, which I expect will make deals of some kind. Canada in particular had been really holding a tough line. Mark Carney, who's in charge there, is kind of the anti-Trump, to be honest. I mean, everything Trump would do, say or think is the opposite of what Carney would do, say or think. But, you know, you're seeing him in 24 hours before this deadline start to change tax, start to have a kind of a cautiously optimistic tone. So, I expect that you are going to see some kind of deal.

The holdouts right now are India and Russia. And, you know, you see Trump using really tough language, calling them dead economies. You know, it's got a kind of a scary overtone there. I think Russia, a trade deal doesn't really matter. Post-war in Ukraine, trade with Russia is kind of a non-entity to begin with. India is a bigger deal because India is a strong emerging market. It's a high growth economy, and it's a kind of a place that a lot of American companies have been trying to move production, given all the restrictions on China.

BLITZER: The Federal Reserve, Rana, on Wednesday decided to hold interest rates where they are not lower them at all despite the president's repeated calls for the chairman of the Federal Reserve, Jerome Powell to slash them. Two Fed governors actually dissented this time and supported a rate cut. We surprised by this? And what does it mean for our viewers?

FOROOHAR: Yes. I wasn't surprised at all that there was a split decision here. You know, Wolf, as we've talked about, I think, you and I before, it is a really tricky moment to be making monetary policy. Inflation remains higher than it has been in the past, and part of the Fed's job is to keep those rates high enough that you don't see the inflation really boom.

On the other hand, there are some signs anecdotally that the economy may be slowing down. It's unclear whether that's happening. The jobs numbers on Friday are going to be interesting on this score. And so, you know, they're in a pickle. I expect what's going to happen though is you are going to see Trump ramp up the pressure on Powell.

One of the reasons that Trump wants interest rates to be low is that that tends to keep stocks high. That's important for keeping everybody with a 401(k) with money in the market happy, but also it helps the U.S. debt and deficit picture. When interest rates are higher, borrowing costs are higher, and the interest on that debt really explodes. And that's something that the White House is watching carefully and they have to manage it. Otherwise, I think a lot of international investors in particular are going to be thinking about pulling money out of the U.S.

BLITZER: Yes, good point, excellent analysis. Rana Foroohar, thank you very, very much.

FOROOHAR: Thank you.

BLITZER: And coming up a new poll showing Israel's actions in Gaza are dramatically losing support among Americans. We'll take a closer look. That's next right here in The Situation Room.

(COMMERCIAL BREAK)

[10:30:00]