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Fed Holds Interest Rates Steady Amid Inflation Concerns; Biden Visits Border States Amid Immigration Law Confusion; Democratic Donors Express Concerns Over Biden's Electoral Prospects; Texas Congresswoman Criticizes SB4 Immigration Law; Biden Courts Latino Voters on Western Swing; Biden Balances Appeals to Different Wings of Democratic Party. Aired 2-2:30p ET

Aired March 20, 2024 - 14:00   ET

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

[14:00:00]

(COMMERCIAL BREAK) BORIS SANCHEZ, CNN ANCHOR: Your move, Fed. The central bank is about to issue its decision on interest rates as it works to battle inflation. We're standing by for that decision set to come at any moment. Plus, confusion on the border after whiplash rulings on a controversial Texas immigration law. A new decision could come at any moment. BRIANNA KEILAR, CNN ANCHOR: And while Buckingham Palace fields

questions about photos and Photoshop, a new scandal about who may have tried to violate Princess Kate's privacy by looking at her health records. We're following these major developing stories and many more, all coming in right here to CNN News Central. SANCHEZ: We have breaking news from the Federal Reserve. The central bank announcing a decision on interest rates as inflation continues to slowly eat into Americans' wallets, still a little bit higher than the Fed would like. CNN business correspondent Rahel Solomon is here to break it all down for us. So Rahel, what did the Fed decide? RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Yeah, so Boris, the Fed decided yet again to keep rates where they are. This is the fifth meeting in a row where they have kept rates steady. So we've been in this pattern since about July. So keeping rates where they are indicating, though, that rate cuts are coming this year. I can tell you that the statement today just came out literally a minute ago, basically says the committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward two percent. That is identical language to the statement, the last meeting. So we're still sort of in this holding pattern. We also got the summary of economic projections. And this gives us a sense we don't get this every meeting. But this

gives us a sense of where the Fed sees the economy going next year, the year after in terms of economic growth, in terms of unemployment, in terms of inflation. And so we'll take a look, a closer look at that sort of as we have a bit more time. But I can tell you just sort of at a quick glance that it is expecting rate cuts, as I said, but perhaps fewer rate cuts because we've been in this space where we've seen at least the last few months or so, we've seen inflation kick back up. We've seen job growth remain a little stronger than expected. We've had job growth the last year of on average about 275 000 jobs being added each month. And we've seen energy prices go up. And so, Boris, I can tell you that the only thing that is scrutinized

more closely than the statement that comes along with the Fed decision is the press conference which begins in 30 minutes. And so every word the Fed chair says will be scrutinized in terms of the path ahead, in terms of when it will be appropriate to cut rates. The chair has said that 2024 rate cuts will be coming at some point this year. He has said that they're not far from having the confidence to begin cutting rates. But the question, of course, right now is where are we on that timeline? How soon do they think that will happen? I can tell you that the

consensus is perhaps the June meeting. But it wasn't long ago when investors thought that that first rate cut of this hiking cycle could come in the March meeting. But again, we've seen an economy that has been stronger than perhaps many would have expected. And so they've sort of held off. And the question is sort of if rate cuts are coming in 2024 , as they have suggested, when are they coming? We're going to hopefully get some more details on that when the press conference begins in about 30 minutes. SANCHEZ: TBD on those rate cuts. Rahel we'll get you to look at the

rest of that economic outlook and bring us the updates as you get them. Let's turn now to CNN's commentator Catherine Rampell. She's also an opinion columnist for The Washington Post. Catherine. So essentially, Fed officials here standing pat because inflation remains a little bit higher than they would like to see it. What do you make of this decision and the signaling that at some point this year we will see a cut? CATHERINE RAMPELL, CNN ECONOMICS AND POLITICAL COMMENTATOR: It was

widely expected, as Rahel mentioned, that the Fed was going to hang tight and not move interest rates in either direction at this meeting. [14:05:09]

So what everyone is paying attention to is instead how they characterize their forecast for the months and years ahead. And there were some pretty significant changes in their forecasts relative to their last meeting, which was at the end of 2023. They radically raised up, I would say, their GDP forecast for this year to 2.4 percent, excuse me, 2.1 percent, as opposed to 1.4 percent. So that's a pretty rosy revision, not to mention that they think that the outlook for the couple of years ahead for 2025, 2026, are also slightly better than they had predicted. All of which is to say, forget that one-time talk of recession. Things look pretty darn good. There are some other measures, though, that were not as encouraging. For example, they raised upward their forecast for the key inflation measure that they look at, what's called core PCE, which basically strips out energy and food because they're really volatile. So they think that that's going to be a little bit hotter than had once been the case, which implies then that we might wait longer until we see rates come down quite a bit. And the same is true, in fact, if you look at their interest rate projections, they also suggest that rates are going to be higher for longer, as many members of the market, many participants in the market, had been expecting. SANCHEZ: Partly because they did what was expected. The markets today looked pretty good. The S&P hit a record high yesterday, and earlier today, the Dow Industrials touched a high point. It seems like the market is responding well. Even to the idea that these rate cuts are going to be delayed. RAMPELL: The rate cuts still look like they are coming, right? It just may be a little bit further down the way than had once been expected. I mean, if you looked back at where market expectations were for interest rates a few months ago, I think that markets were way ahead of the Federal Reserve. They were expecting easing to happen almost imminently. And I think, to be fair, the Federal Reserve had signalled that they were going to slow down. They were going to start cutting interest rates pretty soon. Now, if you look at their numbers, you know, it does look like it'll be a little bit further off, but the economy still looks strong, so that's good. As Rahel mentioned, Federal Reserve Chair Jerome Powell will be speaking shortly and taking questions from journalists.

And I'm sure a lot of people will be closely scrutinizing what he says to either reinforce or undercut the message or the assumption that markets have about when those rate cuts are coming. Again, I think the question is not so much if, but when, and what that means for all sorts of credit products out there, whether we're talking about mortgages or car loans, credit card rates, et cetera. All of those things will be affected not only by the rate cuts, but the anticipation of those rate cuts. So that's why some of this signalling, some of this tea leaf reading is so important.

SANCHEZ: Catherine Rampel, appreciate the perspective. Thanks for being with us.

RAMPELL: Thank you.

SANCHEZ: Brianna.

KEILAR: Here minutes from now, we are expecting to hear from President Biden, who is on the road from Arizona. Later, we'll hear from him in Texas. His visits to these border states follow dueling rulings over Texas's controversial law that would allow state officials to arrest and detain people suspected of entering the country illegally. Right now, the law is back on hold. CNN White House correspondent Arlette Saenz is in Chandler, Arizona, following the president. Arlette, what's his message today?

ARLETTE SAENZ, CNN WHITE HOUSE CORRESPONDENT: Well, Brianna, President Biden is expected to speak here in about an hour as he's really bringing his economic pitch out to these western states. Today's focus will be on touting these government investments, trying to boost manufacturing of semiconductor chips here in the United States. The U.S., through the Commerce Department and the Chips and Science Act, that bipartisan bill passed back in 2022. It's set to give a massive amount of money to Intel as they're trying to ramp up their production of semiconductor chips here in the U.S. This includes $8.5 billion in awards and up to $11 billion in loans. This will help the company expand, build and modernize facilities in states like Ohio, New Mexico, Oregon, and importantly, here in Arizona, a critical battleground state heading into November's elections. The White House projects this could, create nearly 30,000 jobs here in Arizona. They think that it could create over 3,000 manufacturing jobs and 7,000 construction jobs.

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One thing that the president has tried to argue with the need for increasing chip production here in the U.S. is not just an economic imperative, but also a national security imperative. They're trying to make the U.S. less reliant on countries like China for these types of technologies. But it does come as the president is trying to move the needle with voters when it comes to the issue of the economy. About two-thirds of voters can take a look at polling disapprove of the president's handling of the economy, and he has struggled to break through in convincing voters that his legislative accomplishments, his economic policies are paying off for them.

But the visit here to Arizona also comes as immigration and border security have reemerged front and center in the 2024 campaign. You saw that legal back and forth relating to that Texas law, the Supreme Court ruling then Appeals Court ruling yesterday. The White House, of course, strongly disagrees with that law, saying that it will simply sow chaos at the U.S. southern border, and it's an example of Republicans trying to politicize the issue of border security. Of course, the issue of immigration and border security has been top of mind for many voters, and the president has tried to get that bipartisan bill passed in the Senate. Ultimately, it was scuttled because of calls from former President Donald Trump. But it really comes as it's expected that this issue of immigration will continue to come up in the 2024 campaign, and it's something the president will have to tackle in a state like this, in Arizona, and also Texas, where he's heading to fundraise a little bit later today.

KEILAR: All right, sounds like a marching band there with you, Arlette. Arlette Saens there in Chandler, Arizona, getting a little wild ahead of the president's visit. Thank you for that report. Obviously, very serious issues they're dealing with today. Boris?

SANCHEZ: Let's discuss SB4 and more with a Texas lawmaker, Democratic Congresswoman Jasmine Crockett joins us now. Congresswoman, thank you so much for being with us. So before the Fifth Circuit Appeals Court put SB4 on hold, a majority on the Supreme Court had decided to let it be enforced. I'm curious, do you think that signals that the court is open to ruling that the law is constitutional?

REP. JASMINE CROCKETT, (D -TX): I absolutely do believe that. I think that this court has been pretty obvious in their signalling, a little bit more obvious than maybe years past. We saw It happened definitely when it came down to the decision on whether or not Trump would stay on the ballot or not with the Colorado decision. They kind of gave us a signal. We know when the leak decision came out as it relates to Dobbs, we kind of knew what the writing on the wall was going to be. But prior to, they allowed that to go into effect as it relates to some of the Texas abortion cases that were moving through the courts. And so I think that this court has typically kind of signalled and lead into where they plan to go. And I think that this is a bad sign for Texas and the United States.

SANCHEZ: Well, Congressman, the way the law appears to be written, it effectively would allow local judges to adjudicate a migrant's legal status without deference to federal law. That would essentially circumvent that huge backlog of cases for asylum seekers. Do you think that that's an effective way to handle that problem?

CROCKETT: Absolutely not. I mean, obviously we have federal jurisdiction, we have state jurisdiction. We know that immigration falls squarely within federal jurisdiction. And so to allow a rogue state like the state of Texas and yes, I'm calling them rogue because we know that federal law is supposed to reign supreme. And we know that this is a federal issue. It's a federal issue that Congress actually decided that they wanted to weigh in on and actually do some reforms on until Donald Trump said do not do anything. Much like what we've seen out of this Congress, it's a do-nothing Congress. The American people should demand more than allowing Greg Abbott and local law enforcement to just do whatever they want to, especially since the law says because you're suspected of entering the country illegally.

What does a suspect look like when it comes to entering the country? You know, you guys were just covering what was going on in Arizona. We saw something similar happening in Arizona. The idea that we can racially profile our way out of our immigration problems is just something that we know we can't do. They tried it in New York. They tried it in Arizona. And I guess now they think the third time is a charm. But I can guarantee you that all we're going to do is cause more harm than good. We need the federal government to stand up and do their job. And that means that Republicans may have to rebuke the four-time indicted. well, you know the long list of things. They need to rebuke him and they need to do the job that they were sent to D.C. to do.

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SANCHEZ: Congresswoman, on that point about local law enforcement and local police enforcing immigration policy, you pointed out something that critics have repeated. They say it's a huge problem with the law. That they essentially can arrest someone based on their suspicion that they are undocumented, the criteria of which can be nebulous, right?

CROCKETT: Absolutely

SANCHEZ: Local officials like the police chief, yeah, the police chief in Laredo. He's promising that there's going to be more training for officers to make sure that enforcement isn't racially biased. I want you to listen to what he said at a press conference earlier today.

(BEGIN VIDEO CLIP)

CHIEF MIGUEL RODRIGUEZ JR, LAREDO POLICE DEPT.: I can tell you that this law is not about us going out there and doing roundups. This law is not about us going out there and asking for papers and immigration status. This is not about that. This law is very clear that whenever we can apply it, is through a lawful detention or an arrest. Very important that we train and train and train because we want to avoid the racial profiling part of this law, that it lends itself for that.

(END VIDEO CLIP)

SANCHEZ: He's saying it lends itself for racial profiling and perhaps the antidote to that is training. Are you confident that that kind of training is going to prevent discrimination?

CROCKETT: I'm absolutely not confident. As someone who has practiced law, for 18 years. I'm mostly handling criminal defense cases or doing civil rights cases, I can guarantee you that just as he stated, it lends itself to that. There's only so much racial bias that you can teach someone not to have. Interestingly enough, I just had a conversation yesterday about why there are some proponents of AI and believing that, you know what, no matter who you are, when you put people at the center of something, there will always be some sort of bias. And so it is very concerning because the way that this law is written is going to allow for those bad apples to just go out and cherry pick people based upon them saying, well, I thought that they crossed the border illegally.

This is a problem, especially when we start talking about our southern border that tends to have more Latino folk located there. We know that we saw recently law enforcement. I want to say it was Christmas maybe of last year, the year before, where we saw, that there was an American family out of El Paso, and there was a tragic death because law enforcement decided to pursue them because they thought they were crossing illegally. That is not enough. This should not pass any type of muster, and the application is going to be disastrous again, as we have seen time and time again.

What we need to do, is we need to have comprehensive immigration reform. You're absolutely right. When it comes to the backlog, you know, what we need to do? We need to pay people to work. That's something that the president has tried to offer time and time again in a supplemental package. And ultimately, when the Republicans rejected that, he said, fine, we will absolutely look at what we're doing as far as immigration and actually reform the immigration system and not just put more money into it. And you know what? They came to an agreement, a very conservative agreement, and that was turned down.

It is time for this do-nothing Congress to do something that the immigration system is not going to do. It is time for this do-nothing Congress to do something that the American people can rely upon as making sure that they are protecting not only U.S. citizens, but those that are seeking asylum in our country that is supposed to be the land of the free and the land of opportunity.

SANCHEZ: Congresswoman Jasmine Crockett, this case appears destined for the Supreme Court. We hope you'll come back to discuss it when it goes before the court.

CROCKETT: Absolutely.

SANCHEZ: Thanks so much. So they've got money, and they've got problems. A group of a 100 key donors are worried about President Biden's electoral chances in 2024. What's behind a warning they're sending to the White House? Plus, another twist in all the talks surrounding the Princess of Wales. Why the hospital where she was treated is at the center of a new scandal. And this is a bummer. America drops out of the list of top 20 happiest countries in the world. We'll explain why in just moments. (COMMERCIAL BREAK)

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KEILAR: The New York Times is reporting on a warning that was sent to President Biden about his potential for defeat in November. And it's not coming from Republicans, but a number of high dollar Democratic donors. And the Times is reporting 100-some activists and Biden supporters wrote to his campaign. They were expressing these concerns about the rising progressive anger when it comes to Biden's support of Israel in the war in Gaza.

SANCHEZ: They wrote this about Biden supporters, including young voters. And people of color, quote, if they stay home or vote for a third party candidate, there is the very real danger that President Biden will be defeated in November. The reelection of Donald Trump would be a disaster for our country and a bigger disaster for Israel- Palestine. And we fear that the Gaza war is increasing the chances of that occurring. End quote.

KEILAR: Let's talk about this now with CNN senior political analyst Gloria Borger and CNN congressional correspondent Jessica Dean. I guess the question, Gloria, is are they telling the Biden campaign anything they don't already know and how should they be addressing this?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: No, they're not. I spoke with somebody, a senior adviser on the Biden campaign just a few minutes ago before I came on.

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And this advisor said, look, we're doing exactly what they want us to do. We understand what the problem is, but the important thing is they're not saying we're going to leave you for Donald Trump. They're just saying we got to hear each other out and look at who we're running against and we understand we have ground to make up, but we're doing everything we can and everything they want us to do. So, you know, the response was, yeah, we get it and we agree.

SANCHEZ: To Gloria's point, here's actually what a Biden campaign spokeswoman said, quote, the president shares the goal for an end to the violence and a just lasting peace in the Middle East. He's working tirelessly to that end. Jessica, if you can look in the crystal ball.

(CROSS TALK)

JESSICA DEAN, CNN CONGRESSIONAL CORRESPONDENT: Oh, yes. Let me pull it out of my bag.

SANCHEZ: For November 2024.

DEAN: Hang On

SANCHEZ: How likely is it that Democratic-leaning voters either stay home or vote third party? DEAN: Listen, I think this is a real concern that the Biden campaign knows about. You look at the Michigan numbers and the uncommitted voters. These are people that are wanting their voice heard. And so many times in politics, people just want to know they are being heard, that these concerns are at least being thought about, talked about, if not addressed. I think two things are really important. What Gloria pointed out is at no point in that letter do they say we're not donating to you. No. In fact, the Times reported that one of the people that signed it is still proceeding with their big fundraiser coming up later this year. So they're not losing any support. This is the second thing is this is kind of this classic dance between high dollar donors and campaigns and making, you know, kind of trying to get your points in and make sure they understand you. But at the same time, the campaign saying, we know we got it and kind of that push and pull. I think there are other donors that feel differently that are also raising money.

BORGER: If you look at the donors, it was a particularly progressive group of donors. Some of whom supported Elizabeth Warren, for example. So they understand who these donors are. They want to keep them. But they're saying, look, we're on the same page.

SANCHEZ: If they're still donating, then the money talks, right? Gloria, a big part of the president's swing out west is to court Latino voters.

BORGER: Yeah

SANCHEZ: Poll after poll has shown that Donald Trump is gaining momentum among Hispanics, especially when you add that to the fact that he gained between 2016 and 2020 in that community. The Biden campaign has gone after Trump for some of his rhetoric, obviously echoing Hitler talking about immigrants poisoning the blood of the country. But if Latinos are still trending more and more in that direction, are the attacks on the rhetoric itself effective enough?

BORGER: Well, not yet. I mean, really, not yet. I mean, Joe Biden, when he won last time, he got six out of 10 Latino voters. Now Donald Trump is, according to some polls, is getting four out of 10 Latino voters. And what Biden is trying to do on this swing is point out who Donald Trump is, that he says immigrants are poisoning the blood, you know, and using that kind of rhetoric, talking about deportation camps and all the rest of it. So he's trying to kind of say, look, this guy is not a good guy for Latinos, and I'm working on immigration, and I'm working on housing costs. I'm working on the economy. So we'll have to see if it cuts across Donald Trump.

KEILAR: Those were live pictures, by the way. We were seeing a Biden at Intel's campus there in Chandler, Arizona. Next stop, Texas. And he's showing up, Jessica, at a pretty interesting time, just kind of coincidentally, as this controversy over the state immigration law, SB4, is percolating and there's some confusion. How does he balance that when it comes to the two wings of his party, including he's got the progressive wing, but he also has people he's trying to appeal to who want to see more done on immigration, who might actually favor the Texas law or at least understand why Texas is taking action? DEAN: Listen I talked to voters right after super Tuedsay, I was in

Virginia. These are voters that are --they consider themselves independents. They maybe voted for Nikki Haley. They don't want to vote for Trump. It's voters like that that you're talking about that maybe are supportive of stronger immigration measures. And you do have to balance those types of voters, which will likely play a key role in winning these handful of states that he's going to need to win to put them over the edge in November. With making sure you're progressive voters show up and don't stay home. And that is a tricky thing to do. And you have to be able to kind of walk, that line and give everybody a little something he was able to do it in 2020 with the help of people like Bernie Sanders and others who came together and built this coalition for him but as Gloria noted in some of the polling we're seeing those numbers with some of these younger voters in particular starting to soften.

BORGER: He's also saying look republicans had their chance on a tough immigration bill that they're never going to get under Donald Trump and they blew it.

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