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CNN NewsNight with Abby Phillip
How 2026 Could Define President Trump's Legacy; Mamdani Delivers Inauguration Speech; Minnesota Report Sheds Light on New Fraud Claims; New Cuts to Disaster Response Staff. Aired 11p-12a ET
Aired January 02, 2026 - 23:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[23:00:00]
ABBY PHILLIP, CNN HOST: Maduro regime is trying to build leverage against the U.S. And there's no doubt that the U.S. and Venezuela are increasingly at odds these days. The Trump administration has been striking these alleged drug boats in the Caribbean and in the Eastern Pacific since September. And this week, we learned that the CIA carried out a drone strike on a port facility on Venezuela's coast earlier in December.
A second hour of CNN "NewsNight" starts right now. Tonight, live at the table, Brad Todd, Charles Blow, Betsy McCaughey, and Miles Taylor. Americans with different perspectives aren't talking to each other, but here, they do.
Good evening and welcome to a second hour of "NewsNight." I'm Abby Phillip in New York. Let's get right to what America is talking about. How will 2026 define President Trump's second term and his legacy? Now, historically, second term presidents know that they're up against the clock to pass their agenda. And Trump's 2026 calendar is already filling up pretty quickly. He'll have to pick new Federal Reserve chairman in May. The Supreme Court could hand down a critical decision on tariffs and also on birthright citizenship in June. And then there are the midterm elections in November. But Trump says that he's got nothing but time.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES OF AMERICA: We have three years and two months to go. And you know what that is in Trump time? Three years and two months is called eternity.
(END VIDEO CLIP)
PHILLIP: Not so much. You know, I mean, this is a midterm election year and one in which historically, the party in power is not likely to do particularly well. So, when Trump says he has three years, what he really means is that he probably has more like 11 months, much less than that, when the political pressures are going to start to bear down on him. And I do think that his administration understands that. They know. That's why they're moving so fast. Because they know that this is their time.
BETSY MCCAUGHEY, FORMER LIEUTENANT GOVERNOR OF NEW YORK, CO-FOUNDER OF SAVENYC: But on the other hand, Trump and his administration know that when Americans have more money in their pockets and more money in their 401Ks, that they're going to be happier about it.
And the fact is I just got a report this week on 401Ks that shows during the first three quarters of 2025, 401Ks, the average 401(k) increased in value by $23,000.
Now, think about it. Sixty percent of American workers have a 401(k) or similar retirement account. During the Biden years, 401Ks steadily decreased in value. Suddenly, those people know they're going to have more in their retirement account.
Secondly, growth hit a staggering 4.3 percent in the third quarter of 2025, more than anybody predicted.
So, this economy is on a roll. It will be -- it will mean more money in people's pockets, more money in their retirement accounts, and that's going to have an impact on the midterm elections and certainly the president's legacy.
CHARLES BLOW, LANGSTON HUGHES FELLOW AT HARVARD UNIVERSITY, SUBSTACK AUTHOR: This is sliding right into the Bidenomics hole, which is you keep telling people about numbers and you should feel better because of this number. And this number is great, too. And look at the five great numbers that I've found. But there's 95 great numbers that don't go in your favor. There are bad numbers. There are cost of living numbers. There are things that you have to deal with on a daily basis.
MCCAUGHEY: Oh, Charles, cost of living numbers, 9.1 percent inflation under Biden.
BLOW: Keep telling people those numbers --
MCCAUGHEY: Yeah. Let me tell you, numbers do matter. And people --
BLOW: The numbers that matter --
MCCAUGHEY: -- push the numbers aside --
BLOW: The numbers that matter is that I'm worried about whether I can afford macaroni while he's out shopping for marble. Those are the numbers that matter.
MCCAUGHEY: Oh, all that jealousy of the rich has nothing to do with --
BLOW: Jealousy of the rich. That's a crazy statement.
MCCAUGHEY: That's exactly the rhetoric. That's exactly the rhetoric. The numbers do matter.
BLOW: That's a crazy statement. When you're talking about people with 401(k) --
MCCAUGHEY: If the numbers were on your side, you'll be looking --
BLOW: -- the working-class people, the people at the lower end of the totem pole are the ones less likely to have 401(k). And those are the people who are going to be struggling the most. And those are also the people --
MCCAUGHEY: Most union people have a 401(k).
BLOW: You act like -- oh, the union people are the lowest on the totem pole. That's crazy, too. But the thing is that people on the lower end of the totem pole are the ones who are really struggling. And those are the ones that he had made real inroads with. He had made real inroads with people, minorities, Black men. He had made real inroads with Hispanics. He's destroying all that with policies that are hostile to them --
MCCAUGHEY: No, he's not. He's (INAUDIBLE) 401Ks?
BLOW: As a Black man, I'm telling you right now, because I've been to a barbershop more than once because all the hair is gone, he's having a horrible time with Black men right now.
BRIAN TODD, CNN CORRESPONDENT: Let me get one thing down, though. Is 4 percent growth good or bad?
[23:05:01]
BLOW: OK, we can point to five indicators. I'm not --
TODD: It's a big one. It's a big one. Is it good or bad?
BLOW: Let me tell you something. When you're in the grocery store and you're pushing the cart and it's empty and you get to the self- checkout because they fired all the other people who work there and you ring up and you barely have enough money to afford the tin items in your basket, you really don't even understand nor care about it.
(CROSSTALK)
You're still blaming Biden.
(CROSSTALK)
TODD: Let's see if we can agree here a little bit. I think you're right that the president needs to be focused on common table -- kitchen table concerns and helping continue to move things forward. All right? And it does matter what says the grocery store. I'll agree with you on that. Now, will you agree that 4.3 percent growth and inflation in the twos, that's also good, right?
BLOW: OK. Go ahead.
TODD: Right. So that's the objective. The president has to start at the macro level and work down. There's more work to be done. The president needs to be clear.
BLOW: All I said was that is the Biden problem. They also had great macro numbers that they could point to.
PHILLIP: Including growth that was at 4 percent.
BLOW: Exactly. We had come out of a horrible time with the pandemic. We were trying to see if we were going to be able to bounce back to some degree. They were making progress.
(CROSSTALK)
As I said, you could always point to something, but here's the point --
TODD: No --
BLOW: Here's the point. Here's the point. The average American simply wasn't feeling it the way that they were saying it. And you guys turned right around --
MCCAUGHEY: That's just not true.
BLOW: You guys turned right around and did the exact same thing.
TODD: I'm with you.
(CROSSTALK)
PHILLIP: Hold on. Go ahead.
MILES TAYLOR, AUTHOR, PODCAST HOST, FORMER CHIEF OF STAFF AT DEPARTMENT OF HOMELAND SECURITY, FOUNDER OF DEFIANCE.ORG: I don't think the president is moving fast in this administration because it has anything to do with economics. OK? And I'll tell you, at the end of the first Trump administration, talking to Stephen Miller about what the plan was for the second Trump administration, the plan was to break the law as fast as possible, and then see what the Supreme Court agreed with and what it didn't.
At the time, Stephen said, we've got a drawer full of executive orders. It's going to be a shock and all blitz. That was the strategy, is go do as many things as possible, whether they were legal or not legal, and then in the second year, hope that the Supreme Court came down in favor of as much of it as possible.
Now, we already saw what happened in the first year. If you go back statistically and look, this president has been ruled to have done illegal things, more illegal things in his first year than any president in modern history. That is the data.
MCCAUGHEY: When you say ruled --
TAYLOR: Dozens of federal judges, including judges that Donald Trump appointed and conservative judges --
MCCAUGHEY: -- so many federal judges, lower court federal judges who will be --
TAYLOR: Judges that Donald Trump appointed, judges that George W. Bush appointed, judges that Ronald Reagan appointed have determined that Donald Trump did things that weren't just illegal, but they were unconstitutional. Hundreds of federal judges have ruled that illegal things have been done by this administration.
My point here is they acted quickly because they knew some of those things were going to be against the law. Their hope is that in year two, the Supreme Court sides with them on some of them.
TODD: Let's be clear on that.
MCCAUGHEY: You know, I love what you pointed out. Let me just point out that the Supreme Court has already slapped the hands of most of those lower court judges for imposing national injunctions which they have no authority to do. So, we --
TAYLOR: Well --
MCCAUGHEY: -- both agree --
TAYLOR: -- I will say, Betsy --
MCCAUGHEY: Come on, let's --
TAYLOR: -- the thing -- we're shakenly going to say that on the economy, the president broke the law, raised prices --
PHILLIP: To Miles's point, you know, if Democrats retake control of the House. Here's what Speaker Emerita Nancy Pelosi says is going to happen the instant that they do. Listen.
(BEGIN VIDEO CLIP)
REP. NANCY PELOSI (D-CA), SPEAKER EMERITA, FORMER SPEAKER OF THE UNITED STATES HOUSE OF REPRESENTATIVES: Right now, the Republicans in the Congress have abolished the Congress. They just do what the president insists that they do. That will be over.
UNKNOWN (voice-over): So that ends as soon as you have --
PELOSI: That ends as soon as we have the gavel.
(END VIDEO CLIP)
PHILLIP: And Miles's point about Stephen Miller, I think, is really important because he is the architect of so much of what's happening here, whether it's from immigration, the push to end birthright citizenship, the executive orders, the execution of Project 2025, all of those things. Maybe I shouldn't overstate it. Many of those things will come to a screeching halt once there is --
TODD: Wait a minute, I just want to say that Nancy Pelosi, I'm so glad to have her back. Charles and I probably are both glad to have her back but for different reasons. I hope she stays in the debate.
You know, Miles, your numbers, the president, last I checked, taken to court 533 times, turned 40, still pending. Of the ones that have been decided, he has won about half and he has lost about half. When he loses, he appeals. That's what's supposed to happen.
And none of us may like the creep of executive authority over the last several administrations. I have elected many presidencies. But that is the modern state of things. That's what the Supreme Court's job is to do.
In the end, though, the president is probably going to be held accountable by what he gets accomplished through Congress this year.
[23:09:58]
Nancy Pelosi, I find it funny for her to say the Congress has abdicated this job. She did whatever Barack Obama wanted. Cap and trade, Affordable Health Care Act, stimulus bill. She didn't stop him or stand up to him on anything.
BLOW: They actually passed laws, though. This Congress is literally one of the least productive Congresses in modern history.
TODD: Senate Democrats won't help --
(CROSSTALK)
BLOW: There has always been partisan differences. And people have learned to work around them. And to find ways to come to a bar partisan deal to actually do the job of Congress, which is the only job is to make legislation.
MCCAUGHEY: The Democrats (INAUDIBLE) to impeach the president. That's what they did over and over again.
BLOW: But also, but you now have a president who doesn't say any of the numbers that you guys were just throwing around. He just says that affordability is a Democratic hoax. And so, all of the people out there complaining about affordability are being lied to and then regurgitating the lie, which is political suicide, I think, going --
TODD: I just said it. My advice to him is to say that there's a lot more work to do. But I think 4.3 percent growth is good.
PHILLIP: And look, a couple of signs that Trump knows that, A, the clock is ticking, and B, that he needs to address affordability, delaying tariffs on furniture and upholstered goods and things like that. Also, pulling back from this push to put National Guard in American cities. These are highly controversial things that are not very politically popular.
MCCAUGHEY: He will win that case at this court next June.
PHILLIP: What case?
MCCAUGHEY: The case on the National Guard.
PHILLIP: Well, he has already lost it so far.
MCCAUGHEY: No, he did not lose it. No, no. And unsigned -- PHILLIP: He already --
MCCAUGHEY: Fifteen-page opinion by three justices unsigned simply said they will not give an expedited ruling, that he has to wait for it to go through the ordinary process. It will be decided next June.
PHILLIP: Hold on.
MCCAUGHEY: There was no loss in the Supreme Court.
PHILLIP: What they did was they allowed the stay to go forward. Meaning, look, they haven't done that in all these other cases. In many of the other cases, the Supreme Court has said, you know what, we're going to lift the stay. The executive has the power to do this. Go ahead. They didn't do that in this case. I think that is significant.
But the other part is he pulled back on the plan to put the National Guard in American cities. Why would he do that if he thought that he was perfectly capable of doing it?
MCCAUGHEY: Well, he didn't pull back on all the cities, just the cities that were named. Chicago, for example. And he pulled back because there was a lot of resistance and also because of the execution of those two National Guard. I think he was very concerned about that.
BLOW: But he's not concerned about it in New Orleans or any other red states where he has also done this. It doesn't make any sense.
TAYLOR: He knows it's a loser case.
BLOW: It's a loser case because --
MCCAUGHEY: I don't think it's a loser case.
BLOW: His approval rating is stuck in the 40s.
MCCAUGHEY: He has the authority to do it.
BLOW: His disapproval rating is scraping the 60s. No one who studies politics believes that a president in an off-year election right after he has won with those low of approval ratings can possibly have his party do well.
TODD: Do you know what, Charles?
BLOW: That's the problem.
TODD: He's running against the Democratic Party that has never been less popular. Democrats are at about 19-20 percent rating.
MCCAUGHEY: That's right.
TODD: He does not --
BLOW: Do you know why that is?
TODD: He does not doubt run the bear.
BLOW: Do you know why that is? Because even with those local ratings in the elections that have happened this year, some of them off year, some of them municipal, Democrats have done incredibly well.
TODD: Education advantage.
BLOW: No, no, no.
TODD: They have a turnout advantage. Propensity vote is --
BLOW: Exactly. But you see how what you just said before doesn't line up with that? The idea that the Democrats have a low approval rating and yet they're doing really well in these elections. You know why they have --
TODD: These elections have almost no one showing up, like only the frequent voters. (INAUDIBLE) women.
BLOW: All that. But do you know why this is happening? Because Democrats -- Democratic voters want Democratic politicians to do even more to push back --
TODD: Oh, they're not liberal enough?
BLOW: -- to push back --
TODD: You think Democrats should get more liberal? We need to put you in charge.
BLOW: We want them to push back on Donald Trump more.
PHILLIP: Even by your assessment, even if it's an education advantage, even if it's because there are high propensity voters who are coming out for Democrats, none of that is in Trump's favor in the midterm elections for Republicans.
TODD: None of it. You'd rather win them than lose them. But I can tell you, I was advising House Republicans in 2009, 2010. We didn't win any special election in 2009. We did pretty darn well in 2010, 163 seats in the House. Special elections are special.
BLOW: My only concern is whether or this election will be free and fair. We've seen Donald Trump already try to tinker by forcing states to redraw maps, and then Democrats responded to that. We already know that there are election deniers that have been elected to boards all around the country. We already know that the DOJ has requested from 40 states voter -- sensitive voter data and sued 20 plus states for not providing it. And we have no idea what all of that will mean for --
[23:15:00]
MCCAUGHEY: Excuse me. They want to clean up the voter rolls, take the dead people off the rolls. And, by the way, the Supreme Court will be deciding a case in June about mail-in ballots and the preposterous notion that you can keep -- that you can count ballots that arrived after election.
PHILLIP: OK, which we do all the time for people who live overseas --
MCCAUGHEY: And we should not be doing that.
PHILLIP: -- and the military members.
MCCAUGHEY: Right.
PHILLIP: Next for us, New York City Mayor Zohran Mamdani been on the job for less than 48 hours now. But his first moves are inviting criticism from some of the city's Jewish leaders. Plus, a new report from the state of Minnesota blows some serious holes into a viral video that suggests new fraud allegations at child care centers.
(COMMERCIAL BREAK)
PHILLIP: A new chapter for New York City with the inauguration of Mayor Zohran Mamdani who just yesterday laid out an ambitious vision for the city in a speech that has drawn both immense praise and also some tough criticism.
[23:20:05]
(BEGIN VIDEO CLIP)
MAYOR ZOHRAN MAMDANI, NEW YORK CITY: In writing this address, I have been told that this is the occasion to reset expectations, that I should use this opportunity to encourage the people of New York to ask for little and expect even less. I will do no such thing.
(APPLAUSE)
The only expectation I seek to reset is that of small expectations.
(APPLAUSE)
Beginning today, we will govern expansively and audaciously. We may not always succeed, but never will we be accused of lacking the courage to try.
(END VIDEO CLIP)
PHILLIP: And since taking office, one of the first things that Mamdani did do was revoke every executive order signed by his predecessor, Eric Adams, since September 26, 2024. That was the day that Adams was indicted on federal charges that were later dismissed by President Trump.
Now, among those Adams era orders is one that barred city employees and agencies from boycotting or divesting from Israel, the definition of antisemitism to include some criticism of Israel.
Now, that move is one that has prompted intense backlash from several Jewish-led organizations, including the head of the ADL who says -- quote -- "Removing protections is a dangerous move, especially on day one. Jewish New Yorkers deserve security, not a delete button."
Now, it is -- you can see it both ways here, right? He's saying everything Eric Adams did in those last few months, we're going to get rid of it. But at the same time, he knows fully well that it's extremely controversial to revoke these executive orders that have to do with Israel and have to do with antisemitism given the controversy.
MCCAUGHEY: He's throwing gasoline on antisemitism in New York and it's very troubling. On November 30th, when (INAUDIBLE) synagogue was attacked, he did nothing. As a mayor-elect, he should have condemned it.
And the fact is that during his transition, 20 percent of the people he appointed to his transition team were associated with anti-Zionist, vitriolic anti-Zionist groups. His appointment secretary, for example, who had to resign when it came to light that she had -- her name is Catherine Almonte Da Costa, that she had called for -- she had disparaged money-hungry Jews.
These are the kind of people he has appointed. There was little doubt why Jewish New Yorkers are terrified of his mayoralty because he has done everything to make them terrified.
TODD: We soft-pedaled what that definition is of antisemitism in that open. This definition is one that is propagated by the International Holocaust Remembrance Alliance. It is one used by all but two nations in the European Union. And it doesn't say you can't criticize Israel. It says that it is antisemitic to say that Israel itself, the state of Israel, is a racist concept. That's what this is.
Mamdani is not -- he's going so far on this issue that he is going to inflame tensions. But he also is spitting in the eye of one of America's most important allies.
But to me, there's another thing that happened in his inauguration speech that was notable, is that Zohran Mamdani buried the political legacy of Hillary Clinton. He had Bernie Sanders introduce him. He said, that's the man in public life I most want to emulate. Bernie Sanders is the one that tried to stop Hillary Clinton from being in the White House. He next, in the middle of his speech, it hasn't been covered much, but he took a pot shot at Democrats who say the era of big government is over. That's the line Bill Clinton made famous when he got reelected. Zohran Mamdani is trying to kill the Hillary Clinton legacy.
PHILLIP: I think he would totally agree with you on that. I don't think he is in any way, shape or form trying to nod the hat to Bill and Hillary Clinton, period. That is a completely different type --
BLOW: And when you listen to that acceptance speech or inaugural speech, you know, he wasn't backing down from his positions of what he was saying on the campaign trail. The question will become -- I do believe he does come across to me as earnest and really hoping to get this done. But there are a lot of stakeholders in a big city like New York, long, old money, old legacy who can and will stand in the way of some of that, and whether or not he's able to have the political energy, muscle capital to overcome the opposition he's going to get. And in a city like New York, that's not all Republican. That is on your own side opposition. And whether or not he can overcome that will be the test. I do believe that he wants the best for the city, though.
[23:25:01]
TAYLOR: Here's what's going to happen nationally, is Mamdani-ism, is that's a thing, is not going to take hold. He does not represent the Democratic Party. And I say that as an outsider. I'm not a Democrat. But if you look at the numbers, if you look at the election in which he won, moderate Democrats were winning in places like New Jersey and Virginia, and showing how it was done.
But what will still happen is Mamdani will become the boogeyman. He is an easy boogeyman for Republicans. He's just giving them fodder. And he did that in his inaugural address. He said, I'm an unapologetic progressive. He went beyond that. He's showing why he is an avowed socialist.
BLOW: I don't think it is as big a negative as you think. I think that, you know, the parallels, they're kind of polar opposite way, but parallels between him and Donald Trump are very interesting to me. It is a person who is very much a populist, very much not of the mainstream who says what people in the trenches want to hear. There are a lot of young people in this country for whom Mamdani really struck a chord. They can only vote in this city. But there are a lot of people out there who want to hear people say things like the red is too --
(CROSSTALK)
MCCAUGHEY: Look at the realities, what's happening. New York is going to be bankrupt in six months if Mamdani proceeds with the plans he has announced. Four reports, four on New York City's economy came out in the last two weeks, including the state controller, the Citizens Budget Commission. They all said the current revenues in New York are inadequate to provide current levels of services that the city will have to adopt efficiencies. If they knew how to do that, if they had the management chops to do that, they would have done it.
And the fact is Mamdani will not be able to pay for any of the things he has promised with that huge tax hikes agreed to in Albany, and that will be the death of New York State which is already the most taxed state in America.
BLOW: I lived in New York for 25 years. I cannot tell you how many times people told me New York was going to die.
MCCAUGHEY: New York already runs 50th.
BLOW: They were always wrong. They were always wrong.
MCCAUGHEY: This is outstanding. Amazingly irresponsible.
PHILLIP: -- whether Mamdani is going to become a boogeyman. It's hard to be a boogeyman for Republicans when you go to the Oval Office and you stand next to Trump and Trump is praising you and Trump is taking back everything he ever said about you. I mean, I think that makes it really hard to make this guy a boogeyman.
TODD: Abby, I make ads for Republicans all over the country. He's going to be an ad.
MCCAUGHEY: When he cuts -- when he has to cut sanitation services, he'll be a boogeyman.
TODD: And if you're a Democrat running for office, if you don't want to be sunk with what Mamdani is doing, you need to throw him overboard right now. It is -- America is going to be reminded that socialism never works.
MCCAUGHEY: Right.
TODD: Because he's going to try hard to make it work. And it won't because it never does. And this is --
(CROSSTALK)
BLOW: -- never works either. We're taking --
TAYLOR: But Charles, a very important point here. Politics is not a line. Donald Trump is not over here. Mamdani is not over here. It's a circle. And they're a lot closer to each other than people realize. And the populism that defined Mamdani's campaign is a populism Donald Trump has tapped into. And that's why there is this very strange Venn diagram of people who like Donald Trump and people like Mamdani. It says a lot about what's happening in the undercurrents of politics.
PHILLIP: I mean, it's true not just of Mamdani and Trump but also Bernie and Trump.
BLOW: Absolutely.
PHILLIP: That happened, too. That Venn diagram is very real. And it may not be as small -- that overlapping part is not as small as I think people like to think that it is.
All right, next for us, it was the viral video that fueled fraud allegations over child care centers in Minnesota with little evidence. But now, a new report from the state says that those centers are actually operating as expected.
(COMMERCIAL BREAK)
[23:30:00]
(COMMERCIAL BREAK)
PHILLIP: Tonight, the state of Minnesota is throwing cold water on viral allegations of fraud at Somali-run child care centers. The Minnesota Department of Children, Youth, and Families says the centers at the heart of a controversial video were operating as expected when they were visited by investigators. Children were present at all sites except for one facility, which was not yet open when inspectors arrived.
Now, the agency report comes days after YouTube content creator Nick Shirley, who has created anti-immigrant and anti-Muslim videos in the past, posted a video alleging widespread fraud. As of tonight, that video has amassed more than 100 million views after being reposted by Elon Musk and J.D. Vance. It includes limited evidence, though, to support the claims that it makes.
Now, I mean, I don't know how much more I think conservatives who are very fixated on this one Nick Shirley video need to see, but the actual people who have to adjudicate whether fraud is happening are looking at these facilities and they're saying you can't just go outside of a facility, people decide not to talk to you, and then you say that there's fraud. There's actually more to a fraud determination than that.
TODD: Hold on. Hold on. The Minnesota Star Tribune, the newspaper there, not a conservative blogger, when visited the same 10 places, said only four of them had kids. The prosecutors say there's industrial scale fraud going on. And if you go back in time, way back to June of 2024, Keith Ellison, the attorney general of Minnesota, who is a Democrat, prosecuted a number of people for fraud --
MCCAUGHEY: Sixty defendants have already been convicted of fraud.
[23:35:00]
PHILLIP: Hold on a second. The issue isn't is there fraud. We know that there's fraud. We know that because that fraud has been prosecuted by two administrations, by the Biden administration, by the Trump administration. That's a fact.
The question is whether we know that these particular places that were visited in this video are guilty of fraud based on the fact that someone shows up outside the door, knocks on it, says, hey, I'd like to enroll my --
TODD: You got a trial in this country. Why are you --
PHILLIP: No, no, no. I'm just --
TODD: Why are you taking (INAUDIBLE)? It's Tim Walz government that is guilty of a lot here.
PHILLIP: I'm just asking a question. Do we need proof or not? Do you require --
TODD: Of course.
PHILLIP: -- proof before --
TODD: The prosecutors are going to have -- going to obtain proof.
PHILLIP: So, are you -- are you convinced --
TODD: That's what they will be convicted on, proof.
PHILLIP: Are you convinced, based on watching this video, definitive fraud happens?
TODD: No. I'm convinced by the fact that we have a Medicaid program in Minnesota that has had a lot of fraud. We've had whistleblowers in the department --
PHILLIP: Yes, I get that.
TODD: -- saying that there's going to be a lot of fraud.
PHILLIP: So, when the actual inspectors whose job is --
TODD: They work for Tim Walz. The inspectors who work for Tim Walz.
PHILLIP: -- whose job is to determine whether or not these businesses are operating as they're supposed to be, whether there are kids showing up or not, does it matter to you whether there are kids there? Does it matter to you whether they're operating as inspectors?
MCCAUGHEY: Of course, it matters to me.
PHILLIP: OK.
MCCAUGHEY: The fact is whether Nick Shirley's video is accurate is almost immaterial because --
BLOW: What?
MCCAUGHEY: Wait a second. Talks to me suddenly.
PHILLIP: Immaterial?
MCCAUGHEY: It is immaterial because we have a huge body --
PHILLIP: How is it immaterial?
MCCAUGHEY: -- because we have a huge --
PHILLIP: Because --
MCCAUGHEY: Listen to me. We have a huge body of other evidence regardless of this video --
PHILLIP: OK.
MCCAUGHEY: -- that shows extensive fraud in this state regarding not just child care, but also substance abuse, housing, artistic services, many other things. And the fact is the taxpayers deserve --
PHILLIP: OK. Betsy, I'm aware of that. MCCAUGHEY: Let me finish my statement because --
PHILLIP: Do you know why I'm aware?
MCCAUGHEY: -- taxpayers --
PHILLIP: I'm aware because actual journalists have gone around --
MCCAUGHEY: I'm an actual journalist. And let me tell you --
PHILLIP: -- doing that very -- doing that very reporting that you are relying on in order to --
(CROSSTALK)
MCCAUGHEY: Listen, this has nothing to do with this video.
PHILLIP: The reporting, the actual reporting on the fraud that you are talking about has been done by journalists over the course of many years. And so, now, all of a sudden --
MCCAUGHEY: Why are you making a big deal? You're trying to exculpate --
(CROSSTALK)
PHILLIP: Excuse me. I am not making a big deal.
MCCAUGHEY: Yes, you are. You're making a big deal out of the Nick Shirley video.
PHILLIP: I am not making a bid deal out of it.
BLOW: The administration responded to the video.
MCCAUGHEY: Let me just say --
(CROSSTALK)
-- this is an important point, in New York --
(CROSSTALK)
PHILLIP: Hold on a second. The vice president said that this is a Pulitzer Prize win.
BLOW: Yes!
MCCAUGHEY: Maybe he did, and he's wrong.
PHILLIP: He said that.
MCCAUGHEY: But in New York, Kathy Hochul established a program that would allow people taking care of their own relatives and friends at home to qualify as home care attendants. Whenever you make it so easy to collect a government check, here's what happened, 655,000 New Yorkers claimed the first year that they were suddenly home care attendants.
BLOW: You are automatically changing the subject.
MCCAUGHEY: No, I am not changing the subject. Americans do have audited programs. When you start handing out taxpayer money, you better make sure --
BLOW: It doesn't matter how many times you point your finger in the air.
(CROSSTALK)
TAYLOR: I have a question.
MCCAUGHEY: What is it?
BLOW: The administration still responds to the video. For you to send a video, it doesn't matter. It doesn't make any sense.
(CROSSTALK)
It is weird to now be in a situation where you have people showing up at day care centers who are not the inspectors. I don't want anybody showing up at day care centers.
TODD: Journalists?
BLOW: But journalist, right.
TODD: He's a journalist.
BLOW: OK.
MCCAUGHEY: So, we may be a communist journalist.
BLOW: I'm going to let you have it.
TODD: Just because you don't work for "The New York Times" doesn't mean you're a journalist.
BLOW: But the other thing -- I don't work for "The New York Times."
(CROSSTALK)
But the thing is -- but the thing is --
PHILLIP: Let Charles finish because I really want to make sure Miles has a second. Go ahead.
BLOW: -- right now, the administration says it's going to freeze funding to these places until they can prove it. And if we have agencies that are going out and proving it, that's the problem because again, we're back to the people who really desperately need these services. They're not the people with the 401Ks. These are working class, hardworking people who are really struggling right now, and you're -- (CROSSTALK)
PHILLIP: -- Miles have a word.
TAYLOR: -- can be true at the same time. I mean, I'm a conservative. I do believe if you create a government incentive, people flow to it. There's very obviously proven fraud here. So, there can be fraud. It can also be creepy -- it also can be creepy and weird for the nation to latch on to YouTube justice just because you see something.
[23:40:02]
MCCAUGHEY: Why?
TAYLOR: It doesn't mean we just go crowd cancel facilities and wreck lives. That's problematic also. But I don't think this has to do with any of that, in my opinion.
A month ago, Donald Trump was calling Somali immigrants in this country garbage. I don't say that. I don't bring that back up as a talking point. I bring that back up because it's disgusting to me that my president from my former political party wants to label an entire population of people who've become Americans, by the way, Somali Americans as garbage.
And that's not a one off. It defines his policies. And those policies are determining where they're sending immigration enforcement action, why they're going to investigate fraud in certain places, not others, and why they are willing to accept YouTube justice instead of following a normal justice process. That's what we need first up here.
(CROSSTALK)
BLOW: You guys never say think about billionaire fraud, but you only count (ph) on small fraud.
PHILLIP: Hold on.
BLOW: That's a problem.
PHILLIP: Brad, go ahead.
TODD: Well, I think, first off, if this raises more attention to this scandal, then that would be a really good thing. I don't know why you're intent on discrediting Nick Shirley's video. I mean, I guarantee you, a lot more people trust him more than they trust a lot of mainstream journalists.
BLOW: That doesn't mean anything.
PHILLIP: Listen, I don't care about Nick Shirley personally. This is really more about whether or not there's any truth to what is in the video.
TODD: We know the Medicaid program is full of fraud. PHILLIP: Hold on. No, no, no, stop. We know that there's fraud happening in Minnesota. But the video alleges that just by showing up at specific locations, he has determined that there is fraud. And that is not actually what the video shows. So, that's what I care about. I actually care whether fraud is found. And there's no way --
TODD: Journalists draw conclusions all the time.
PHILLIP: Hold on. There's no way to determine based on what he did, which is literally show up, knock on a door, he wasn't let in, and then he says there's fraud happening. That is -- it's not fraud.
TODD: It's kind of a 60-minute style of journalism.
PHILLIP: No.
TODD: It is. Of course, it is.
PHILLIP: That's a complete misrepresentation.
TODD: No, it's not. Listen, here's a bigger question. Here's a bigger question.
PHILLIP: Brad, here's a misrepresentation of what real investigative journalism looks like. And you know how I know that?
TODD: Yes, it's happening on the administration.
PHILLIP: Do you know how I know that? I know that because there has actually been investigative journalism done on this topic by newspapers in Minneapolis, by "The New York Times." Those investigations have resulted in charges. Those investigations have produced actual fraud.
TODD: Here's a question. Did we pay enough attention?
PHILLIP: So, there is a big difference between those things.
TODD: Did we at this network pay enough --
PHILLIP: That's all I'm saying.
TODD: -- attention to whether Tim Walz was rooting out enough fraud in the Medicaid program?
PHILLIP: Listen --
TODD: Did that happen?
PHILLIP: Hey, listen, we wrote about it when Tim Walz was running for president.
TODD: Did we shine a big enough light on it? Did other networks shine a big enough light on it?
PHILLIP: Hey, look -- TODD: Did we talk about him being a football coach?
BLOW: Donald Trump, his family, and his supporters are getting billions of dollars. That fraud doesn't raise an ass out.
(CROSSTALK)
Our money is at their pockets.
PHILLIP: I think that you can also acknowledge -- I think you can also acknowledge, first of all, these allegations were there when Tim Walz was running for president. Republicans were running campaigns against him and did not --
TODD: Keith Ellison, the Democratic attorney general, was prosecuting --
PHILLIP: And Republicans did not make this a top priority issue when they were running against Tim Walz last year. So, that's on you.
TODD: That's a mistake. Totally.
PHILLIP: That's on you.
TODD: Totally.
PHILLIP: That's not on everybody else. All right, we got to go. Next for us, new year, new cuts. The Trump administration begins slashing dozens of disaster response staff over at FEMA. And it could be just the beginning of a larger effort to shrink that agency. We'll be right back.
(COMMERCIAL BREAK)
[23:45:00]
(COMMERCIAL BREAK)
PHILLIP: New tonight, CNN is exclusively reporting that the Trump administration has terminated dozens of staff members from FEMA's on- call response and recovery teams, the group that makes up the first federal boots on the ground when disaster strikes. Employees received emails on New Year's Eve saying that their positions would be -- quote -- "not renewed once their contracts expired."
And tonight, DHS, which oversees FEMA, is defending this move, saying -- quote -- "This is a routine staff adjustment of 50 staff out of 8,000. The core program consists of term-limited positions that are designed to fluctuate based on disaster activity, operational need, and available funding."
But this also comes as the Trump administration has vowed to significantly downsize FEMA and shift their responsibilities over to the states.
You know, earlier this year, there was that horrible flooding in Texas that really called into question whether this idea of getting rid of FEMA altogether is even a good idea. Now, they seem to be kind of moving forward with at least parts of an idea to trim down on this agency. And I do wonder if that is wise or if that is just sort of ideology speaking where there's actually a real need for these services to be there.
TODD: Well, let's get some context. First off, this is a few dozen employees of an agency that has about 20,000. So, we're like two- tenths of 1 percent of this agency. FEMA's main role is not to provide people, is to provide cash. Most of the expertise in how to fight disasters is actually in the state, the state emergency management associations.
I have worked with governors in all through the hurricane belt. And the way it works is the state spent about 10 to 25 percent of the money. They also have most of the brain power. The feds fill in the back with the rest. That's how it works.
Now, the states actually don't even have to have the few federal experts that do exist because they all have a compact and work together.
[23:50:04]
If a hurricane hits South Carolina, Texas can send their experts in to double up them. And then they can seek federal reimbursement for their time. This is exactly how the governors want hurricane response to work. They want to have more state leeway.
Federal bureaucracy, we may not need 20,000 people for federal hurricane response. It may be way too much. And losing 50 of them surely is not a problem.
MCCAUGHEY: It's certainly not enough to make a big deal out of it. But the fact is it is a good idea to trim these federal agencies and bring the services and decision making closer to the people who are involved. Do you remember during the hurricane, just after the hurricane, when one woman who works for FEMA was accused of instructing her employees to bypass homes that had Trump voting signs in the windows? She didn't want Trump homes to be helped after the hurricane. And, of course, she was fired. And FEMA had an internal investigation about it.
But the fact is that when we have an agency that is run out of Washington, D.C. where over 90 percent of the employees always vote for one party, the Democratic Party, you're not going to have evenhanded impartial, nonpartisan services to the states because it's always going to be biased against the Republicans. That's exactly what happened --
BLOW: Are you really arguing that FEMA is not giving the money to people? Listen, there was one study that was recently done. They looked at the 25 districts, congressional districts, that received the most funding from FEMA. Seven of them, I think, were Democrat. The rest of them were Republicans.
TODD: Where hurricanes happen.
BLOW: But the point is this, though.
MCCAUGHEY: Thank you.
BLOW: The point is this. You are making the argument that somehow, they're going through and not giving money because all of the people are Democrats or whatever --
(CROSSTALK)
PHILLIP: OK. Hold on.
(CROSSTALK)
PHILLIP: Charles and Betsy --
(CROSSTALK)
Miles actually has experience in this.
TAYLOR: (INAUDIBLE) oversee FEMA when I was DHS chief of staff. And I will tell you this. I agree with Betsy as a conservative that I want to see bloated federal agencies slim down. And FEMA was not immune to that. It was a very big bureaucracy.
But I will tell you, my service wasn't in some random administration. It was in the first Trump administration. I will tell you that's not what the president cared about. The president cared very much when he engaged with us on FEMA that FEMA use its money to support political friends in red states and not to give money to blue states. That's what the president cared about when it came to FEMA.
I will tell you, Republicans like me serving the president in the administration were very alarmed by that because I don't hold the view that only my Republican friends should be saved if their houses are on fire. I believe my Democratic friends should also be saved if their houses are on fire. The president wanted to slim the agency to have more control over its funding, and he said it this past June when he said his goal is to house decisions about FEMA money in the office of the president. He wants to dole out FEMA cash for politics, not for Americans.
PHILLIP: We got to leave it there.
MCCAUGHEY: You know how much I like you, but I can't your word for that.
PHILLIP: We got to leave it there, Betsy. Next for us -- next for us, the panel is going to give us their night caps what their New Year's resolutions -- what New Year's resolutions they think should be forbidden. We'll be right back.
(COMMERCIAL BREAK)
[23:55:00] (COMMERCIAL BREAK)
PHILLIP: We're back and it's time for the new year's nightcap. It's January 2nd and some people have likely already broken their new year's resolutions. But maybe that's not such a bad thing because some resolutions don't deserve to be seen through, right? So, what resolution do you think should be banned? You each have 30 seconds to tell us. Brad?
TODD: I don't think we ought to have resolutions to say I'm going to get up early this year. I think you ought to get up with the sun at a normal time like any other animal and proceed about your day after that time. Sleep until the sun gets --
PHILLIP: Yes, sleep matters. Good.
(LAUGHTER)
TAYLOR: I'm really stuck on that one. People aren't going to like this one. But I have to say it, anyway. I consulted with my wife beforehand. And it is this, that dry January should not exist. If you don't have an issue, keep the party going into the new year. And if you think you have an issue, then maybe stopping at the end of January doesn't cut it. Become a non-drinker, a happy five-year non-drinker like me, and you will enjoy yourself. So, I think we get rid of dry January.
PHILLIP: So, you are a non-drinker --
TAYLOR: For five years, and I am loving it.
PHILLIP: -- dry January.
TAYLOR: Yes.
MCCAUGHEY: Congratulations.
TAYLOR: Thank you.
MCCAUGHEY: Congratulations. That's wonderful. That's really great. Well, I say stop struggling with your weight. Now, just call the drug store and get one of those weight loss drugs and forget about it. At least one thing we don't have to worry about anymore. And also, I want to get along with Charles Blow and find a lot of common ground.
(LAUGHTER)
TODD: Are you banning that resolution? Are you starting it?
TAYLOR: And if you use this referral code Betsy has, you can get a discount. Today, if you call right now, you can get a discount.
MCCAUGHEY: That's right. I'll get my cut.
BLOW: So, I'm going to be the sappy one. I don't believe we should get rid of any resolutions. I think it is one of the most wholesome things that we do as a country. People figure out something in their life. They want to do it better, even if they don't stick with it. I think January becomes one of these moments, these months where everybody is just trying the new one thing that they think they could do better. I'm just -- I'm in favor of it.
PHILLIP: New beginnings, new year, new beginnings.
MCCAUGHEY: Yes.
[00:00:00]
PHILLIP: And also, yes, it's good to think that you can like be a better, different person, you know, and then try to put your best foot forward. I think that's fine.
