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The Situation Room

Trump Declares Economic Warfare on Iran; National Debt Hits Staggering $40 Trillion Milestone; Lindsay Clancy's Attorneys Call Witness in Murder Trial. Aired 10-10:30a ET

Aired August 20, 2026 - 10:00   ET

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

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[10:00:00]

PAMELA BROWN, CNN ANCHOR: Happening now, $40 trillion and counting. A grim milestone for the national debt. Why it's raising the alarm for the U.S. economy and your wallet.

Plus, Florida faceoff, former Republican turned Democrat David Jolly is in The Situation Room. I'll find out his plans to take on one of President Trump's staunchest allies for a key to the governor's mansion.

And back to Britain, Prince Harry and Meghan are moving back across the pond. How the royals are reacting to their return.

WOLF BLITZER, CNN ANCHOR: And economic D-Day. President Trump is waging a new war against Iran. His plans for what he's calling the most crushing economic operation ever taken against any country, end quote.

Plus, skin cancer breakthrough, details of a new vaccine that could prevent it from spreading and even returning.

And rearming felons, how the Trump administration is making it easier for convicted felons to get back their guns.

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

Happening now, relief inches closer and closer for the troubled USS Abraham Lincoln aircraft carrier battle group. The Pentagon confirms that the USS George Washington aircraft carrier has now arrived in the Middle East to relieve it after disturbing reports of supply shortages and mental health issues. One person aboard the Abraham Lincoln tells my colleague and friend, Pamela Brown, that it feels like the day before Christmas on board.

Also happening now, President Trump is declaring war on Iran's battered economy. The president's frustration with the stalled peace talks appears to be boiling over in a social media thread, which also drove up this morning's oil prices by more than 2 percent. The president is also warning other nations against throwing Iran a, quote, lifeline. CNN senior White House reporter, Betsy Klein, is joining us right now. So, what else are you learning, Betsy? This is very dramatic, very powerful. His words are intense.

BETSY KLEIN, CNN SENIOR WHITE HOUSE REPORTER: Intense indeed, Wolf. President Trump is making the calculation here that economic pressure is going to be able to achieve what military force so far has been unable to accomplish, and that is to bring Iran to the negotiating table in a meaningful way.

But for Iran, though, that really remains to be seen. We've reported that President Trump has told his top envoys to halt talks with Iran until its leaders signal any fresh willingness to make a deal. And the White House is telling its political allies that there is a shift in strategy here. They are moving away from hammer Iran ASAP to a more long-term strangle them strategy here, the president now announcing an economic step.

He says in a post to social media, quote, I am announcing the most crushing economic operation ever taken against any country. He goes on to say, this will be economic warfare and isolation on an unprecedented scale.

Now, the president went on to say that there is going to be consequences for any country that provides any lifeline to Iran, an economic D-Day. Iran so far dismissing this threat. Wolf?

BLITZER: All right, Betsy Klein at the White House, thank you very, very much. Pamela?

BROWN: All right, Wolf. Happening now, investigators are searching for the cause of a helicopter crash in the East African nation of Kenya. Five Americans are among the seven people killed. The head of Ecuador's intelligence agency also died in this crash.

I want to bring in CNN Aviation Correspondent Pete Muntean here in the situation room. So, Pete, tell us what more you're learning about this.

PETE MUNTEAN, CNN AVIATION CORRESPONDENT: Well, this was a sightseeing flight deep in northern Kenya carrying the guests of luxury tour company AndBeyond. The helicopter, a Eurocopter EC 130 B4. It's now made by Airbus.

It's a single engine helicopter designed in part for tourism, has a wide cabin, panoramic visibility. It went down near Mount Olokwe in rugged terrain. And the Kenyan Red Cross says an active fire and difficult access complicated the recovery effort.

What investigators now have to piece together is what happened on that relatively short flight, if weather, terrain, or the helicopter itself, or some other factor played a role in here. So far, authorities have not really identified much of a cause.

I've done some flying in Kenya. It has a robust aviation system, a lot of safety safeguards there. We'll see as this transpires and as investigators dig into this.

BROWN: And, Pete, there was also a deadly collision between a police helicopter and a small plane in Pennsylvania. What can you tell us about that?

MUNTEAN: We'll likely hear from National Transportation Safety Board investigators about this later today, and they have a lot to dig into here, even though the Pennsylvania State Police maintains its pilots were not at fault here.

[10:05:06]

The latest from the state police commissioner is this collision happened just a few feet above the runway. At the scene, you can see the tail boom of that Bell 407 state police helicopter sheared off completely. Not much visible at the scene of the other aircraft, a Cessna 150.

A flight tracking data appears to show the Cessna was coming into land just as the helicopter was setting down. State police say the Cessna hit their helicopter from behind.

Now, this crash took place at the airport in Carlisle, Pennsylvania, and flight tracking data shows the helicopter left a state police hangar west of Harrisburg about 20 minutes before the crash. The helicopter then made what's called a straight in approach to the runway in Carlisle, a practice that's historically been shown to create a risk of a midair collision.

No control tower at the airport. It's not busy enough. Also means there's no early air traffic control audio recordings to share with you. So, it's not really clear right now if the pilots were announcing their positions to one another over the radio. That's the standard practice when there's no control tower.

Of course, investigators will want to know if both aircraft were transmitting and receiving anti-collision data called ADS-B. FAA rules do not require it at the Carlisle Airport. The NTSB has been pushing Congress to mandate ADS-B in more airspace since that tragic and fatal midair collision involving that U.S. Army helicopter and an American Airlines regional flight back last January that killed 67 people.

BROWN: Yes, we remember that vividly.

All right, Pete Muntean, a lot going on in your space today. Thank you. Wolf?

BLITZER: And still ahead Florida's Democratic gubernatorial nominee, David Jolly, joins us live here in the Situation Room to talk about the race just ahead in a very red state.

Plus --

BROWN: Severe weather impacts states already dealing with the aftermath of major storms. CNN Meteorologist Allison Chinchar is tracking it all for us in the CNN Weather Center. (COMMERCIAL BREAK)

[10:10:00]

BLITZER: Happening now, the U.S. national debt at now surpassing $40 trillion, one that will have wide-ranging consequences for businesses, for the government, and for you. That national debt has ballooned in just the last year, increasing by some $2.9 trillion. The grim milestone is hitting sooner than expected. Back in 2023, the Congressional Budget Office projected that the U.S. wouldn't cross that threshold until 2028.

Also happening now, the U.S. Treasury Department set to buy back even more U.S. debt, and that's having a major impact on bond markets right now, which in turn impacts interest rates for you and for everyone.

Let's go live right now to CNN Senior Reporter Matt Egan, who's joining us. Matt, what's going on with the bond market, and how does all this impact our wallets?

MATT EGAN, CNN SENIOR REPORTER: Well, Wolf, when people think about the market, they often think about stocks, but the real power is in the bond market, specifically the Treasury market. That's where traders buy and sell U.S. debt. And when they get more nervous and bond prices go down, rates go up, and that is very important because Treasuries set the cost of borrowing across the economy. The higher Treasury rates go, the more expensive it is to get a mortgage, the more expensive it is to have a small business loan or a car loan, and, of course, the more expensive it is for the government itself to borrow.

And what we've seen in recent months is investors have gotten increasingly nervous about this $40 trillion mountain of debt, stubborn inflation, and high government spending. That has driven up the U.S. Treasury rate significantly. So, back in 2020, it was historically low, around 1 percent. It's gotten higher and higher, and in the last few months, it's gotten creeping closer to 5 percent, and that's exactly the opposite of what the Trump administration wants.

So, what happened about 24 hours ago is Treasury Secretary Scott Bessent, he surprised the market by coming to the rescue. He announced plans to at least double Treasury buybacks to $4 billion each. Notably, this is going to take place during the lead up to the midterm election.

Treasury presented this as kind of a technical move. They said that the goal here is to provide greater liquidity. Liquidity is the grease that makes markets work. When there's not enough liquidity, things can go haywire. But a lot of people on Wall Street, they see this as part of Treasury Secretary Scott Bessent's greater plan to try to keep a lid on Treasury rates.

And let's see how it's working. So, initially, it did work. We saw Treasury rates, they came down significantly yesterday, both the ten- year and the 30-year, and that drove up the stock market. However, the opposite is happening today. In fact, the ten-year is basically back to where it was before Treasury announced this surprise move.

Some on Wall Street, they did expect that the impact was going to be pretty short-lived because at the end of the day, this doesn't solve the underlying problem. The government is spending way more money than it takes in every single day, adding almost $7 billion dollars of debt, $285 million per hour, almost $5 million per minute. And the higher treasury rates go, Wolf, the greater the pressure on the White House.

I do think that's why James Carville famously said in the 1990s that if there was reincarnation, he used to want to come back as the president, as the pope or a 400 baseball hitter, but now he wants to come back as the bond market because you can intimidate everyone.

Back to you, Wolf.

BLITZER: All right. Matt Egan, excellent report, thank you very, very much. Pamela?

BROWN: All right, happening now, we are following a round of severe storms heading toward the Mid-Atlantic that could bring flooding to the region today.

[10:15:01]

Let's go live now to CNN meteorologist, Allison Chinchar. What are you watching for today, Allison?

ALLISON CHINCHAR, CNN METEOROLOGIST: Yes. So, this line of storms has already moved through portions of the Ohio Valley. The same areas that were hit so hard last week now is really kind of taking aim at the northeast and portions of the mid-Atlantic as we go through the rest of the day today.

So, you already have some flood watches in effect in anticipation of that next round of showers arriving. You also have some flash flood warnings for some of these places that have just continued to see rain shower after rain shower so far this morning.

Now, we have had portions of about two to four inches already fall across Indiana and Ohio. That may not sound like much, but, remember, these are the same areas that had a foot of rain last week. So, adding even two to four inches is just going to increase a lot of those creeks, rivers, and streams to swell up again like they did last week.

Now, going forward, however, the bulk of the heaviest rain is actually going to be across areas of the northeast and the mid-Atlantic, where we could be looking at three to six inches of rain coming down over just the next 24 hours. That's why you have these areas really in the higher risks for the excessive rainfall and the potential for flooding. That includes New York, Philadelphia, down through D.C., Baltimore, and even down through about Norfolk, Virginia. That's where kind of that cutoff line is going to be. Here you can see the first round as it kind of goes through this afternoon.

Now, by late this evening, say, after about 6:00, 7:00 P.M., that's when you're really going to start to see it ramp up for D.C., Philadelphia, New York, even into Boston as we continue through the overnight hours.

BROWN: All right. Allison Chinchar, thanks so much. Wolf?

BLITZER: Happening now, court is in session. We're watching the latest coming out of the Lindsay Clancy trial. CNN's Brynn Gingras is following it for us. Brynn?

BRYNN GINGRAS, CNN CORRESPONDENT: Yes. The big question today, Wolf, is will the defense rest its case today, and then will we hear again from the prosecution? I'll break down all of that, what we expect today, and also some pivotal testimony, crucial testimony, that we heard from so far for the defense's case.

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BLITZER: Happening now, the Lindsay Clancy trial is in session for the day. On the stand, Sheila Cavanaugh, a hospital chaplain who met Clancy the day after the killings.

Clancy's on trial for the murder of her three young children. Her defense says she's not criminally responsible, arguing she was suffering from a severe mental health crisis related to postpartum psychosis.

Yesterday, a psychologist who met with Clancy days after she killed her three children told the courtroom he believed she had bipolar disorder with postpartum psychosis.

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PAUL ZEIZER, CLINICAL AND FORENSIC PSYCHOLOGIST: My opinion is that she did have indeed a mental disease or defect. That's a legal construct, not a DSM-V one, but she had bipolar disorder with postpartum psychosis. In addition, she was unable to conform her behaviors to the rule of law, and she had no appreciation for the wrongfulness of her acts.

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BLITZER: All right. Let's go to CNN's Brynn Gingras, who's covering all of this for us. Brynn, what's the latest?

GINGRAS: Yes, Wolf. Actually they just called this witness to the stand. There was a quick recess as soon as court resumed today with a sidebar before that. So, we're really getting a late start. The judge already telling the jury they're actually going to end early today and have a longer day tomorrow. So, that's allegedly we're still on track though as far as the timeline of this trial.

But this might be another key witness in the case. That witness you just showed your viewers, he said on the stand yesterday that Lindsay Clancy also told this woman, the chaplain at one of the places that she was getting care at, that Lindsay told her that she also heard a male voice that instructed her to not only kill her children, but also kill herself.

Now, that would be the second person allegedly Lindsay told this to, the first being that gentleman that you just saw on the stand from yesterday. His testimony was extremely important to the defense's case. He's had a long relationship with Lindsay, meeting with her dozens of times since this incident happened in January of 2023.

And yesterday, when we saw the cross-examination of that witness, no surprise there, but the prosecution went hard at him, basically questioning that relationship with Lindsay Clancy, questioning whether or not he could be an impartial witness with having spent so much time with her, and also questioning why Lindsay Clancy never reported hearing any voices to any of her doctors or anyone she was seeking care from prior to the incident happening in 2023.

So, there were some really wins, would you say, for the prosecution, also for the defense yesterday. We'll have to see, of course, where this all lands with the jury, but, again, this might be another crucial witness for the defense. As we are hearing, it's possible the defense might wrap up its case maybe today, maybe tomorrow, but sometime soon. Wolf?

BLITZER: And I know, Brynn, there's also been some Lindsay Clancy supporters gathering outside the courthouse today. What do we know about that?

GINGRAS: Yes, Wolf, I mean, dozens of women wearing pink outside the courtroom today, cheering on Lindsay, supporting her. Essentially, we've heard from mothers of multiple children, people who have gone through the same symptoms that are being described in the courtroom, people who are just watching the case and are just enthralled by it.

When defense attorney Kevin Reddington walked into the courtroom, he got a huge applause. Also, I think we might have time to hear from Kevin Reddington. Let me go to that and talk more about it afterwards.

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KEVIN REDDINGTON, DEFENSE ATTORNEY: I think that it's the, the mental health system. I hate to use the word healthcare because unfortunately in this case we can see it hasn't been healthcare, and I think that it shines a light on this issue.

[10:25:03]

I mean, when a woman is going through what so many people do, and they go to a doctor and the doctor says, you know, here, take this pill, take that pill, take this pill, and then they basically treat them for 15, 20 minutes and send them on their way, it's just not right.

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GINGRAS: So, obviously, Reddington, as Lindsay Clancy's defense attorney, understanding and appreciating the support that he was receiving outside the courtroom, and that she's receiving. He said that he was going to tell Lindsay that they were all out there. He said she's, quote, beat up and so sad. This will definitely help her out a lot.

So, a lot of emotions around this case, Wolf, whichever way you think it should go.

BLITZER: Okay. Brynn Gingras reporting for us, thank you very much.

And just ahead, royal return, the Duke and Duchess of Sussex are heading back to the U.K. CNN Anchor and Royal Correspondent Max Foster is live for us just outside Buckingham Palace. Max?

MAX FOSTER, CNN ANCHOR AND ROYAL CORRESPONDENT: What a surprise, so many questions. Even the King didn't know about this until Sunday. Outstanding questions, why now? What are they going to do when they get here? Where will they live? What we know, after the break.

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