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Fed Cuts Key Interest Rate By A Quarter Percentage Point; House GOP Sides With Trump And Goes After Liz Cheney; CNN Investigates Mysterious Drone Sightings In New Jersey. Aired 2-2:30p ET

Aired December 18, 2024 - 14:00   ET

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

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[14:01:29]

BORIS SANCHEZ, CNN HOST: Breaking News. Just into CNN. The Federal Reserve announcing its latest decision on interest rates. What this means for everything from credit cards to the housing market.

Plus, new details about the 15-year-old girl who killed a teacher and fellow student at her Wisconsin private school. Her home life now in the spotlight as investigators search for a possible motive.

BRIANNA KEILAR, CNN HOST: And it is a bird? It's a plane? It's probably not a drone. That's the whole point here. As more sightings are reported, we sent aviation correspondent Pete Muntean out to do his own investigation, highly informed into what's happening in the skies over New Jersey. And we are following these major developing stories and many more all coming in right here to CNN News Central.

SANCHEZ: Thank you so much for sharing part of your afternoon with us. I'm Boris Sanchez with Brianna Keilar in our nation's capital. And we begin this hour with breaking news. Any second now, we are set to find out if the Federal Reserve will follow through on expectations that they will cut interest rates.

KEILAR: Let's go straight now to CNN's Matt Egan who is live for us at the Federal Reserve. What can we expect, Matt?

MATT EGAN, CNN REPORTER: Well, the Federal Reserve just slashed interest rates by a quarter of a point. This was the third straight interest rate cut and it was widely expected. This means that the Fed's key borrowing rate is now a full percentage point lower so than where it was back in September.

And for borrowers, this is good news, right? Because it's going to be a little bit cheaper if you're carrying credit card debt, you're trying to get a car loan or perhaps even lower mortgage rates as well. But the bad news here is the Fed is signaling that they want to tap the brakes on interest rate cuts next year. That's because Fed officials just put out new projections where they are now penciling in only two interest rate cuts for 2025. That is down from the four cuts that they had been signaling back in September.

So that means, yes, borrowing costs could still go lower, but perhaps not dramatically. So there was also some new language that was inserted into the Fed statement that signals that they may want to pause here because Fed officials now say that they will consider the, quote, "Extent and timing of future rate adjustments". In other words, don't just assume there's going to be another interest rate cut in January.

Now, there's also some significant changes to the projections that were also just released that do help explain this thinking. Specifically, the Fed is now bracing for a little bit hotter inflation next year than in the past. They're now penciling in and projecting 2.5% inflation at the end of 2025. That is up from 2.1% that they had been expecting back in September.

And that does help explain why the Fed is signaling they may want to pause here. There's also the fact that the economy continues to grow at a significant pace and the unemployment does remain low. There's also so much uncertainty about the agenda from the incoming Trump administration and whether or not tariffs and potentially deportations could actually make prices go higher.

Later this hour, we expect to hear from Fed Chair Jerome Powell where he's going to take questions and he could drop some more clues about what's ahead next when it comes to interest rates.

SANCHEZ: To that point about the agenda in an incoming Trump administration. I mean, Trump has come out and said that he believes that the Fed should take more direction from the White House.

[14:05:06]

I wonder if you expect that Powell may answer questions to that effect, Matt.

EGAN: Well, Boris, Jerome Powell, he's made clear that he really takes seriously the idea and the importance of central bank independence. When I asked Powell back in September about this very issue, he pointed out that central banks around the world that are independent from the influence of politicians, they actually have lower inflation. So we should expect Powell to reiterate the importance of Fed independence and that they don't take orders from politicians.

And he's made clear in the past that he would not step down even if the President Elect asked him to. Of course, the President Elect has also said in recent weeks that he expects that Powell will be able to serve out his term. Of course, a lot can happen over the next few months when it comes to how financial markets are going to react to the latest Fed moves, to the latest inflation readings and of course, the incoming policy changes from this administration. Boris.

SANCHEZ: Matt Egan live for us at the Federal Reserve. Thanks so much, Matt.

Turning now to Capitol Hill and as House Republicans wrap up their own investigation on the January 6th attack, they've concluded that former Representative Liz Cheney should be investigated by the FBI.

KEILAR: That's right. For probing what happened in that attack and looking at the role of then President Trump in the insurrection.

Joining us now is former U.S. Attorney Harry Litman. Harry, this report is alleging witness tampering by Liz Cheney with star witness in the January six hearing, Cassidy Hutchinson. Is there any merit to their claim here?

HARRY LITMAN, FORMER U.S. ATTORNEY: None that I can see. This is really brass knuckles stuff, Brianna. All they have is there were communications between Cheney over a signal line so they don't know the content.

And Cassidy Hutchinson, that happens with witnesses in every hearing. And what happened here, if you may remember, is that she, Hutchinson initially had a lawyer paid for by the Trump Organization who had told her in her account not to be forthcoming. And then she got another lawyer and gave all kinds of details about January 6th about Mark Meadows and the like.

So the idea here is that she was lying the second time when she gave the fuller account and that Congresswoman Cheney somehow was corruptly persuading her to do that. It's something that no self-respecting prosecutor would think about at the DOJ. But we have the full on Orwellian nightmare possibly that it's referring over and a Trump Bondi DOJ decides, well, maybe we will look into it and if nothing else make a lot of trouble for Liz Cheney. Not to mention Cassidy Hutchinson.

SANCHEZ: Harry, what about the speech and debate clause? Does that shield former Congresswoman Cheney?

LITMAN: It's arguable, Boris. You could go either way. The classic is activities on the House or Senate floor, this is related to a witness. The latter mill in the interim report says no. I think the better argument is yes, but the bigger point here is nothing wrong happened. They communicated with a witness and helped her get another lawyer. So the speech and debate is an extra potential level of protection. I think the DOJ would consider that, but really, the initial charge just is completely empty.

KEILAR: So the report says that the FBI should prosecute Cheney if Kash Patel becomes the FBI Director. Does he have discretion on something like that?

LITMAN: Well, here's one thing we know. Trump could order it, even illegally, and it would. He'd be immune under the Supreme Court. But the -- I think the short answer, practically speaking, Brianna, is yes, because that's the way Trump is now reforming the DOJ to say orders come from the top. So I think if they decided they want to do it, there would not be a legal impediment.

It's really down the middle of the things we are afraid of now that the department is going to be taken over by loyalists to Trump who want to go after people who they thought were disloyal to him last time around, like Liz Cheney.

SANCHEZ: There are significant protections, though, Harry, from federal criminal investigations that exist around members of Congress and the legislative work that they do. Do you expect that Cheney might be protected from legal action? And if not, do you think she would benefit from a pardon by President Biden?

[14:10:07]

LITMAN: Well, that's a really interesting call. Generally about the pardon, she would benefit, I think. And you're right, Boris, in general, when you -- if you would actually try to unveil a charge like this, there would be eight problems with it. Could they, however, investigate in a way to make trouble, make her pay a lot of money? That's always a secondary agenda that they can try to implement. And the answer there is they could.

But yes, at the end of the day, this won't go anywhere. There's no chance she will be convicted of this charge, which requires that she somehow be trying to make Cassidy Hutchinson lie. So it's not going anywhere.

But in the interim, could they make trouble expense for her dirtier up in the public? Yes, possibly. That's the exact thing we're worried about with the Patel Bondi Trump lineup in starting January 20th.

KEILAR: Yeah, absolutely. Harry, thank you so much for your insights. We do appreciate them.

LITMAN: Thank you.

KEILAR: Robert F. Kennedy Jr. says he'll be back on Capitol Hill after the holiday break as he lobbies to become the nation's next Secretary of Health and Human Services. It's a huge department that oversees Medicare, Medicaid, the CDC, the FDA and a number of other agencies.

RFK Jr. told reporters that he'll be pressing Democratic senators for their support of his confirmation. He's been meeting with Republican senators this week and faced questions about several of his controversial positions. A known vaccine skeptic, Kennedy has also challenged Big Pharma and the corporate agriculture industry.

Joining me now is Dr. Deborah Birx, who served as the coronavirus response coordinator in the first Trump White House. She is now a senior fellow at the Bush Institute and a professor at the Texas Tech University health Science Center. Dr. Birx, thank you so much for being with us.

You've heard RFK Jr. He says here recently that he's all for polio vaccines, but the issue is really one, not just a being for a vaccine, but whether you believe it should be required. And a mandate is something that President Elect Trump has made clear he has issues with. And there's also this issue of where RFK Jr may stand on other vaccines. Do you have concerns about how much influence RFK Jr may have on public health policy based on his own beliefs?

DEBORAH BIRX, FORMER WHITE HOUSE COVID-19 RESPONSE COORDINATOR: Well, let's separate the two issues. Let's separate childhood vaccines from adult vaccines, because I think childhood vaccines has really proven how critically important they have been. In fact, many children today do not get a smallpox vaccine because through vaccination, we were actually able to eradicate smallpox.

And that's what we were on our road to do with polio. And that's why they switched the polio vaccine from a live attenuated vaccine to a whole killed vaccine. And that is part of the controversy. But we're on our way, hopefully, to actually remove polio as an issue, and then we remove those vaccines when it's no longer an infectious disease threat.

I think what President Trump and Robert Kennedy are speaking to about relevant to mandates is the whole issue of the mandate around the COVID vaccine. And I was really intrigued by Harry Enten's data that really showed how much hesitancy has gone up just in the last four years related to that mandate. And I worked epidemics all over the world. It's much more important to educate and listen to communities than it is to mandate, particularly around adult issues.

KEILAR: I think we've also heard Trump speak about the mandate in the context of the polio vaccine, even as he's championed it. So you've also -- you're aware of where RFK Jr. is on mandates for childhood vaccines. So I know that you're separating the two, but I don't know that these gentlemen always do. Does that concern you, then, that it could influence public policy based on RFK Jr.'s personal beliefs that may not be backed by science?

BIRX: You know, I've already seen this significant increase in vaccine hesitancy, and I think some of that, and I would say all of it often is on us as public health individuals. Because it says to me that we're not reaching people with adequate information that they feel comfortable with what's being discussed and what we're asking them to do.

And so I have found throughout, and this reason I spent seven months on the ground going from state to state during COVID because you cannot analyze an epidemic or community's needs from a computer in Atlanta. You have to get out in the communities and ask and answer their questions, and you can learn a lot about their concerns, and then you can put your words in a way that we're addressing their concerns.

[14:15:07]

At the same time, we're increasing everyone's understanding about immunology and how these vaccines work.

I think because we applied that the COVID vaccine could protect against infection and then everybody knew it didn't, that now they're questioning, did we somehow mislead them on childhood vaccines? And we know childhood vaccines protect against both infections -- significant infection disease and long-term herd immunity, which COVID vaccine doesn't do.

And so I think we've a bit muddied the picture. It's on us now. And to use this opportunity during the Senate briefing for the senators and the staffers to come forward with that data and use this really as a time to educate the American people and get everybody on the same sheet of music about how their immune system works and how important vaccines are.

KEILAR: Yeah, there was a lot of confusion around that, whether it would stop infection or whether, ultimately what we saw, was it stopped a lot of people from dying or being severely infected.

After the Trump administration, you revealed that while you were working as COVID response coordinator, someone was delivering a parallel set of data to Trump about the pandemic. So you've seen that happen before. Do you worry what that means, if it happens again?

BIRX: Well, I consider that all of our jobs, those of us who work in science and public health, it's our job to make sure that the American people have the information that they need and more importantly, we listen to their concerns. Because I keep hearing people saying, you know, this is this and this is that. But we're not really addressing the American people's concern.

They see the rising rates of autism. They want to understand it. OK, it's not back vaccines, we've agreed that. But what is it then? So they want an explanation for what's causing these rising rates. They see increasing rates of cancer in young adults --

KEILAR: No, I'm tracking you on that, Dr. Birx. But I guess my question is, and I think, I don't think anyone can argue with the idea of listening to people's concerns, meeting them where they are. But if the president -- soon to be president, receives alternative facts that are not true, which was your experience when you were in the White House, what is your advice to someone who needs to combat that?

BIRX: Very importantly, find those who will listen to you and are influencers. And that's what I did. And that's, you know, whether it's the governors of states or the mayors or other individuals within the White House. There's a lot of people in the West Wing. I found them, most of them, very easy to work with. And they were very helpful to me in making sure that the information that was really the science and data crossed the President's desk in a way that was understandable and clear.

And I think sometimes in public health we don't explain things in a very clear way. And sometimes just a simple graph will convey the information when words don't.

KEILAR: Do you think sometimes, though, even if you're explaining it clearly, if some other information is coming in that appears to be explaining it clearly but is not based in science but is believable to the person you're explaining it to, you really have your work cut out for you? You may not prevail in convincing them?

BIRX: Well, you know, that's true in every pandemic all over the world. And dealing with presidents and prime ministers -- every president, prime minister I've ever dealt with wants a pandemic that they want, not the pandemic that they have. And that's always true because you have to deal with the most vulnerable in a community, the most least understood, the most marginalized. And it's our job as public health officials to stand up those individuals, to make sure their voices are heard.

And I have every confidence that there are people that will make sure that that happens. I know I am one of them. I'm going to continue. I go out on both what people would consider right wing media as well what people consider left wing media, because I think information is information and everybody should have it.

KEILAR: Dr. Deborah Birx, thank you so much for being with us. We appreciate your time.

BIRX: Thank you.

KEILAR: And coming up on CNN News Central police in Wisconsin are searching for a motive in Monday's deadly school shooting. We're going to tell you what we have learned about the suspect.

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[14:29:14]

SANCHEZ: There's some new details emerging about the 15-year-old girl who opened fire at the Abundant Life Christian School in Madison, Wisconsin on Monday, killing a teacher and fellow student. Six other people were wounded, including two with life threatening injuries. The city's police Chief says the biggest priority right now is determining the motive of the shooter.

KEILAR: Court records obtained by CNN show that the teen's parents divorced and remarried and then divorced again and that she had been enrolled in therapy. CNN's Natasha Chen is here with details. Natasha, what can you tell us?

NATASHA CHEN, CNN NATIONAL CORRESPONDENT: Well, Boris and Brianna, the court records show sort of a complicated situation there. As you mentioned, divorced, remarried, divorced again. And it seemed at least in one of those divorces, the custody arrangement involved bouncing back and forth a couple days here, a couple days there in a very complicated schedule. So that's right now what we're reading through.

[14:25:08]

She had been in therapy. And, you know, this is a lot of what the police are combing through right now, looking for documents that might have been taken from her home to see if it matches what they understand is circulating out there. Some of her writings that they cannot yet authenticate.

Now, we did also see a photo of her that was perfect, posted by her father on social media of her at a shooting range in the last year or so, where she is wearing a shirt that has the name of a German rock band whose lyrics were also cited by the gunman in the Columbine school shooting in 1999. That is also something that investigators are looking at.

And meanwhile, you can imagine this community is still just reeling from this tragedy, trying to find answers, holding vigils. Here are some of what they're telling us as they cope with this.

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MAYOR SATYA RHODES-CONWAY, MADISON, WISCONSIN: Yesterday, the Madison community experienced a terrible and traumatic event. And we will never be the same. But we will get through this and we will get through this together by relying on each other and by taking care of each other.

MYA CULLEN, UNIVERSITY OF WISCONSIN SOPHOMORE STUDENT: How many more lives need to be lost? How many more lives need to be taken for people to wake up? I mean, our children, our loved ones are stuck between a crossfire. When is it enough? When is it enough?

(END VIDEO CLIP)

CHEN: We're also hearing from students and parents who have told us about the teacher who was killed, saying she was kind and caring, that she would have done anything for her students. Boris and Brianna.

KEILAR: Natasha Chen, thank you for that.

Coming up, keeping up with the drones. One month into these mysterious sightings over New Jersey, CNN speaks with experts and residents searching for an explanation for what is in the sky.

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