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Texas Flood Investigation; Extreme Turbulence Rocks Delta Flight; Gaza Starvation Crisis Escalates; Tariff Deadline. Aired 1- 1:30p ET

Aired July 31, 2025 - 13:00   ET

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

[13:00:00]

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BORIS SANCHEZ, CNN HOST: Deadline day is here. Countries have until midnight to reach trade deals with the United States or face significantly higher tariffs. President Trump says that deadline will not be extended, even though he just gave one country an extension. So what comes next?

BRIANNA KEILAR, CNN HOST: And President Trump's Middle East envoy is visiting Israel as the hunger crisis in Gaza brings global condemnation and even division among Trump's base. And the president insists Hamas' surrender and release of hostages is the way to end the war.

And dozens hospitalized from extreme turbulence on a Delta flight. One passenger says he was lifted out of the seat for 30 seconds.

We're following these major developing stories and many more all coming in right here to CNN NEWS CENTRAL.

SANCHEZ: Time is running out, or is it? President Trump set a midnight deadline for countries to strike trade deals with the United States or face sweeping tariffs. And he doubled down yesterday, saying the deadline would not be extended.

And then just a few hours ago, he announced that Mexico is going to get an extra 90 days. As for the others, some major deals are still up in the air, though his aggressive tariff policy could hit a major roadblock. Today, an appeals court is hearing a case alleging the president overstepped his legal authority to impose these tariffs.

Let's get right to CNN's Kevin Liptak, who is tracking all of this for us.

So, Kevin, where do negotiations stand at this hour?

KEVIN LIPTAK, CNN SENIOR WHITE HOUSE REPORTER: Yes, and it seems like it depends on country to country.

And you're right that President Trump, even though he says that this deadline, which is midnight 01 tomorrow morning, is firm, he is also demonstrating a degree of flexibility with countries where he sees some progress being made in these trade talks, and in particular with Mexico.

He got off the phone with President Claudia Sheinbaum. He said it was a good conversation. He says more and more they're getting to know each other. And he says that, because of the unique complexity of the U.S.-Mexico trading relationship, which is the U.S. and Mexico's biggest trading partner, and because of the shared border between the two countries, that this is going to be a more complicated negotiation.

Allowing 90 more days for those trade talks to progress, clearly seeing that there is some progress being made and wanting to allow for some more time for that to sort of bear fruit. And now, so while those talks are ongoing, the tariffs that are in place now will remain in effect, and they are still relatively high, but it will allow those higher tariffs that he had threatened to sort of be held off.

Now, the president sees progress there. There are a number of other countries where he does not seem to be seeing any progress whatsoever, including with India. He called India today a dead economy. He has now imposed a 25 percent tariff on that country. U.S. officials saying that they're frustrated that New Delhi is not opening its market to U.S. imports.

I think altogether you would see quite an emboldened stance from the president here,clearly thinking that this tariff policy is yielding these new trade deals. And you have seen him roll them out from Japan, from the E.U., from South Korea really over the last week or so, the president very much intent on allowing this deadline to stand unless he thinks that progress is being made for a better deal.

SANCHEZ: And I imagine, Kevin, that the White House is closely watching this legal challenge essentially saying that the president doesn't have the authority to enact these tariffs.

LIPTAK: Yes, and this is a challenge being brought by Democrat-led states, but also by certain small businesses, who say the president's use of this 1977 economic emergencies law doesn't allow him to impose these tariffs, and also that he bypassed Congress in putting these tariffs into place.

This is being heard in a federal appeals court today. The judges who were appearing at did appear somewhat skeptical of the president's use of his emergency powers here, one judge saying that the word tariffs doesn't even appear in this law that the president is citing. President Trump himself has sort of made this court case out to be a make-or-break moment for his entire economic policy.

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He wrote this morning to all of his lawyers who have fought so hard to save our country, "Good luck in America's big case today," the president saying that, "If our country was not able to protect itself by using tariffs against tariffs, we would be dead."

So, clearly, the president viewing this case as quite critical to his overall economic agenda. SANCHEZ: Kevin Liptak, thank you so much for breaking that down for

us -- Brianna.

KEILAR: We're joined by Gene Sperling, senior adviser to former President Biden, as well as former President Obama's National Economic Council director.

Gene, I wonder how you're seeing this deadline in light of Trump extending Mexico's current tariff rates.

GENE SPERLING, FORMER DIRECTOR, WHITE HOUSE NATIONAL ECONOMIC COUNCIL: Well, I think at this point the issue is probably less the deadlines than what is the impact of this overall tariff policy on the U.S. economy.

In other words, however things resolve with India or Mexico, you now have the president having successfully raised the average tariff rates to the highest it's been since Smoot-Hawley in the Great Depression. And he's claiming this is a win.

But what we have seen is that it's actually had what people would call a stagflationary effect on the economy, which is, we had fairly strong growth last year. And this year we were headed for solid growth and lower inflation. And what's happened now is -- let me just give you an example.

Goldman Sachs on the month the president was elected, was projecting growth would be near 2.5 percent, but core inflation would come down to near 2 percent. Now what's happened solely due to the president's tariff policies is, we see inflation, instead of being around 2 percent, going to 3.3 percent.

In fact, Goldman Sachs predicts 3.3 percent. And growth is going the wrong way. It's only 1.2 percent for the first half. And this is creating the quandary that the president wants to blame Jerome Powell for, which is weaker growth, a weaker economy would normally give the Fed room to lower rates.

But when at the same time inflation is going up that's a stagflationary move. And so while I think there will be drama around what happens in this last week or so, I think the real issue is now going to be that the president has successfully raised tariffs. And is that a positive thing? Or did he just do a new 18 percent tax on consumers that will lead, as the Yale Budget Lab projects, to a $2,400 tax increase on goods bought by the typical American family?

KEILAR: So talk about how the typical American feels this, because it doesn't at this point feel like going off of a cliff, right? I mean, we should be clear about that.

But when you're talking about those kind of numbers, I mean, $2,400 is a lot. The Fed's preferred inflation index at 2.6 percent, we learned today, new numbers, that's up 0.3 percent. Consumer spending is up. How are people, how are everyday Americans experiencing this?

SPERLING: Well, I think you're absolutely right, and it is fair to note that we have not seen the worst of it so far, but there's really understandable reasons.

You have a lot of companies that are trying to eat the tariffs so far that haven't passed on those prices. But this is not something where you have to get into the Fed minutes or intricate things. Let's just look at what's happened. Walmart has already been raising prices on car seats and baby goods.

Procter & Gamble just announced that they would raise prices on a quarter of their goods. Ford said they had to raise $2,000 for some cars. So you are seeing the kind of bread and butter, Walmart, Procter & Gamble companies that people are buying from starting to raise prices.

And the fact is, you can hold off for a while, but soon you're going to pass off at least half of that. The president just put a 50 percent tax, tariff on Brazil. He's got something on Colombia. Where do we think we drink coffee from? Do we think we're going to start growing coffee in the United States? So it's just odd because this is a moment in time where you have the American public really focused on prices and price levels.

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And some would say that President Trump beat President Biden because of unhappiness over price levels. So the fact that the public has seen him raising tariffs on ordinary products, not just semiconductors, though that would affect prices, but things that will end up affecting clothes, pajamas, baby seats, coffee, I think people are going to feel it.

And I think you're already seen in polling right now that people are not happy about it. But, for the Federal Reserve, it means what do we do? Growth is slowing down, but inflation is going up. That's not the Federal Reserve's fault. That is the direct policy result of this tariff policy. It both slows growth and raises prices.

That's the phrase stagflationary direction comes from. And that is completely a self-inflicted wound. And so the president is making a very, very big bet that Americans are going to be OK with this and the Fed is going to be OK with this. And I think we're already seeing at least enough signs of inflation that it's freezing the Federal Reserve from lowering rates.

And you're already starting to see -- hear some of that consumer unhappiness, which will only get worse in the next four or five months.

KEILAR: Yes, we will be hearing from consumers. They do get a say here.

Gene Sperling, great to have you. Thank you so much.

SPERLING: Thank you.

KEILAR: At the same time, the White House is making a new push to end the starvation crisis in Gaza. U.S. envoy to the Middle East Steve Witkoff met with Israeli Prime

Minister Benjamin Netanyahu in Jerusalem today, a week after the U.S. pulled back from Gaza cease-fire talks, citing bad faith negotiations from Hamas.

SANCHEZ: And, today, President Trump posted on his TRUTH Social account that the fastest way to end the humanitarian crisis in Gaza is for Hamas to surrender and release the hostages.

Let's discuss with CNN global affairs analyst Brett McGurk. He's a former National Security Council coordinator for the Middle East and North Africa.

Brett, I wonder what the message is here from Witkoff to Netanyahu. It seems unlikely that we're going to see a cease-fire soon, in large part because Israel's main demand is that Hamas relinquish control of Gaza, something Hamas is not likely to do.

BRETT MCGURK, CNN GLOBAL AFFAIRS ANALYST: I think -- you were talking about deadlines on tariffs. I think where this is heading, my understanding is, there's going to be a deadline on Hamas to accept the deal that's on the table, because there's a division within Hamas.

So go back only 10 days ago, there was a lot of optimism we were actually leading towards a 60-day cease-fire because the Hamas leadership in Doha, the outside leadership, had accepted a deal. My understanding is the inside leadership, the guys actually holding the hostages, said no, and that's when this whole thing fell apart.

So, if the thought is to put pressure on Hamas with a deadline, maybe get back to that deal, I don't think that's going to work. I think Israel and the U.S. actually walked into a trap here starting back in March, when the cease-fire that was in place after the inauguration -- I worked with Steve to help get that in place -- fell apart.

And Israel imposed a new policy, a total blockade of Gaza, something that was unprecedented in this war. When I was working on this issue, completely unacceptable. We worked on the aid issue every day, nonnegotiable. Aid has to get in. You had almost 80 days of no food getting into Gaza.

That caused this chain reaction of events that are now playing out. So it's a really difficult situation. I think it's good that Steve is there. But, right now, I don't see the way forward.

KEILAR: And we're seeing the response from a number of countries. Canada is joining the U.K. and France in planning to recognize Palestinian statehood. How does that impact the dynamic?

MCGURK: I have to say, Brianna, again, I go back to when I was working on this issue, constant coordination with our European allies, kind of bringing them into the negotiation. Where do things stand?

And, honestly, whatever the intent of Macron and Starmer in these statements, it makes getting a cease-fire harder, because what they're saying in those statements is -- especially Starmer. He said, we will recognize a Palestinian state unless there's a cease-fire in Gaza.

Right now, the obstacle to a cease-fire in Gaza is Hamas. So I just see Hamas now holding out. I mean, they're going to say, this is kind of now going our way. So it's destructive to the goal we all want. What is the goal we all want? We want this war to end. We want the hostages to come out. We want food to get into Gaza. That should be the focus.

And what are the steps to get there? And I think these statements from the French and the Brits and others, I don't think actually help move in that direction.

SANCHEZ: It does speak to a broader vision of what happens after the war in Gaza, right? I think there are elements within Israel that have pushed for Israel to take over the enclave. President Trump has been skeptical of a two-state solution.

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He's actually talked about moving the Palestinians out of Gaza. So, if that's not in the cards in terms of Western support, if there isn't a legitimate force outside of Hamas that you can negotiate with or coordinate a Palestinian state with, then what do we wind up with but war?

MCGURK: I think, Boris, it's a great question. It's a difficult question, another trap I think President Trump walked into.

I don't -- I think what he meant when he said Palestinians should leave Gaza was that you got to rebuild a place. Where do people go? But what he actually did by saying that was, he made getting to the permanent cease-fire much more difficult. It fed the ambitions of the hardest right extremists in Israel. It fed the hard-liners in Hamas, who said, see, we should never give up, look at that plan.

I think that was a mistake. You're also asking a great question, because Macron and Starmer are saying, Hamas must disarm. They must withdraw from Gaza. The question is, who? Are they going to send troops in? If you do this, if you do -- it's kind of counterinsurgency math.

How many effective and reliable security personnel do you need in an area to have security after a situation like this? It's about 20 for every 1,000 of the population. That means you need to force in Gaza about 40,000 to 50,000 effective, reliable non-Hamas security personnel ready to stand up to Hamas.

Who is that going to be? Look, I talked to every Arab capital about this, European capitals, briefed NATO, talking about, is there any chance we could have an outside force coming into Gaza at the end of this? And the answer really is no.

So, it's a key question. And it's -- we don't want Israel to occupy. We don't want Hamas to be there. Who's going to be there? And Israel -- one thing Israel is not good at all is connecting political ends to military objectives. They have not done this in Gaza. They have not explained where this is going to go.

And that void is now being filled by these movements by the French and Brits and others.

SANCHEZ: It is a conundrum. And it's great to get your perspective on it, Brett McGurk.

You should actually go check out Brett's columns on CNN.com. They're up right now.

Thanks so much.

MCGURK: Thank you.

SANCHEZ: Coming up: chaos in the sky, severe turbulence sending unbelted passengers and bar carts flying on a Delta flight, dozens of people sent to the hospital after the plane made an emergency landing. We have the details coming your way.

Plus: a fight for accountability. Weeks after the deadly flash floods in Texas, state lawmakers and survivors are grilling local leaders about their response.

KEILAR: And student loan payments for nearly eight million borrowers are about to go up.

We're following these stories ahead on CNN NEWS CENTRAL.

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SANCHEZ: We have new details about a Delta flight that struck severe turbulence, so bad 25 people on board had to be hospitalized after the flight was forced to make an emergency landing in Minnesota.

This is Delta Flight 56 touching down at Minneapolis-St. Paul International Airport. It was met by medical teams upon arrival. One passenger describes people and service carts hitting the ceiling several times.

(BEGIN VIDEO CLIP)

LEEANN CLEMENT-NASHVILLE, PASSENGER: If you didn't have your seat belt on, everyone that didn't have, they hit the ceiling and then they fell to the ground. And the carts also hit the ceiling and fell to the ground. And people were injured.

And it was -- and it happened several times, so it was really scary.

(END VIDEO CLIP)

SANCHEZ: Yes, the flight was en route from Salt Lake City to Amsterdam.

CNN's Pete Muntean joins us now with the details. Pete, what are you learning about that?

PETE MUNTEAN, CNN AVIATION CORRESPONDENT: Well, this is probably, Boris, the worst incident involving turbulence on a us commercial flight in recent memory, 25 of the 270 people injured on board.

We're talking about one in every 10 passengers. That's why the National Transportation Safety Board is now investigating this. Injuries, -- the top cause of injuries on board commercial flights is turbulence, according to the NTSB. And key to investigators will be the weather at the time of the crash.

Our weather team has pointed out that there was what's called a SIGMET, an outlook by the FAA for thunderstorms in the area at the time of this crash -- or time of this incident. Excuse me. It occurred about 20 minutes after takeoff from Salt Lake City over Wyoming, where there was an area of thunderstorms up to about 35,000 to 40,000 feet.

This flight was cruising at about 37,000 feet. We have also heard from passengers this was during dinner service on board this long-haul flight, which would explain the images of the galley cart that we saw tossed through the aisle of this airplane.

In fact, one passenger told us that a flight attendant was tossed up to the ceiling. These major turbulence events can have so much g-force involved. Thankfully, the plane is designed to withstand that. And it seems like there was no damage beyond that. We're also just learning this from Delta Air Lines, that its seven crew members who were on board who were taken to the hospital have now been released from the hospital.

Delta Air Lines also tells us that the passengers who will share their condition with the airline, they have also been released from the hospital as well, Boris.

SANCHEZ: Glad to hear that at least.

Pete, you're at NTSB headquarters for a series of hearings on that January midair collision between a Black Hawk helicopter and an American Airlines flight. And we have learned some really stunning details about what happened.

MUNTEAN: Yes, essentially, the narrative on day two of these unprecedented three days of hearings about this January 29 crash, this midair collision, really paint the picture of what's called normalization of deviance, where there were changes at the Army level and the FAA level that deviated from the standard.

At the air traffic control level, at the FAA level, controllers today testified that there was essentially a just get it done mentality inside the air traffic control tower, that there was a push, push, push mentality at some times, which may explain why the controller in the tower that night elected to have American Flight 5342 sidestep from the normal runway used at Reagan National Airport and onto the alternate runway, Runway 33 there, which ultimately put it in the path of this Black Hawk helicopter. [13:25:25]

Also, a major admission by the Army here, that it says that its pilots from the 12th Aviation Battalion, the squadron in question at the time of that crash, would regularly fly under commercial flights that were descending into Reagan National Airport. This is something that had so many here incensed, including NTSB Chair Jennifer Homendy.

And this is what she told me about that practice.

(BEGIN VIDEO CLIP)

JENNIFER HOMENDY, CHAIR, NATIONAL TRANSPORTATION SAFETY BOARD: There is -- at no point should there ever be helicopters flying underneath civilian aircraft that are departing and landing on any runway, any runway in the national airspace.

And it's -- and I'm concerned that, if it's happening here, that it's happening somewhere else.

(END VIDEO CLIP)

MUNTEAN: Today has been primarily focused on the practices by air traffic controllers.

The idea here was to get to the practices used by the Army, their anti-collision technology on board this Black Hawk helicopter, which was turned off at the time of this crash. NTSB Chair Jennifer Homendy says we are way in the weeds today. This is heavy stuff. That second part about anti-collision technology could move to tomorrow -- Boris.

SANCHEZ: Pete Muntean, thank you so much for the update there -- Brianna.

KEILAR: Happening now, an official reckoning over what went wrong during the deadliest floods to hit Texas in more than a century. This joint hearing of the Texas House and Senate is expected to go on for hours. The July 4 flash floods killed more than 130 people, including dozens of children, and nearly all of the deaths were in Kerr County.

Today, its emergency management coordinator confirmed he was out sick when the flooding began, saying his illness began on July 2.

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W.B. "DUB" THOMAS, EMERGENCY MANAGEMENT COORDINATOR, KERR COUNTY, TEXAS: I had already requested and been approved for personal time off on July the 3rd to fulfill a commitment to my elderly father. However, due to my progressing illness I remained home to recover.

I stayed in bed throughout July the 3rd and did not participate in the regularly scheduled 10:00 a.m. and 3:00 p.m. Texas Emergency Management Coordination Center coordination calls. My supervisors and sheriff's office leadership were aware that I was off-duty.

(END VIDEO CLIP) KEILAR: CNN Shimon Prokupecz is in Kerrville attending this hearing.

Shimon, you spoke to the mayor of Kerrville earlier today. What did he tell you?

SHIMON PROKUPECZ, SENIOR CNN CRIME AND JUSTICE CORRESPONDENT: Yes, look, Brianna, it's very clear what's happening here. You listen to that sound that we're hearing there from the emergency coordinator, it's just passing the buck. That's what's going on here.

And very clear that this was a county, Kerr County, where Mystic Camp was, where all those R.V. parks were, where all the people were streaming in for the July 4 events, was not prepared. They were not on any phone calls from the Texas Department of Emergency Management, while other counties were. They ignored e-mails to get on calls.

And this is what I asked the mayor about. I asked him, because I have been asking the mayor of this and I have been asking county officials, were they on calls here with the Texas Department of Emergency Management, which was making preparations for this storm?

And when I caught up with the mayor today, just before this hearing, which is taking place behind me, I asked him, did you see that e-mail at 1:00 in the morning saying for you to get on a call on July the 3rd with Texas Department of Management officials, to get on a call to talk about the weather concerns?

He said he missed that e-mail. Take a listen to some of what else he said to me.

(BEGIN VIDEO CLIP)

JOE HERRING JR., MAYOR OF KERRVILLE, TEXAS: And I did not receive a telephone call.

PROKUPECZ: OK.

HERRING: I did receive an invitation...

PROKUPECZ: OK. From?

HERRING: ... which I have said I wish I'd seen it, but I didn't see it.

PROKUPECZ: You didn't see the invitation?

HERRING: I did not.

PROKUPECZ: So, your e-mails that were released, you saw them?

HERRING: They were there.

PROKUPECZ: They were there.

HERRING: I know.

PROKUPECZ: It was at 1:00 a.m. that you got an e-mail.

HERRING: At 1:00 a.m.?

PROKUPECZ: Yes.

HERRING: I didn't know about that.

PROKUPECZ: From Texas Department of Emergency Management, saying that there'd be a call at 10:00 a.m.

HERRING: OK. I didn't see those e-mails. I'm sorry.

PROKUPECZ: And then, later in the day, they sent an e-mail with the (INAUDIBLE).

HERRING: Right.

PROKUPECZ: I think it was like in the afternoon.

HERRING: Right. And you have reviewed those?

PROKUPECZ: Yes, yes, I have.

HERRING: And they say a moderate risk, up to four inches of rain.

PROKUPECZ: But, like, I guess, had you seen that e-mail, you would have been on the call, right? I mean...

HERRING: I would have been on the call. I take responsibility for missing the e-mail. I do.

(END VIDEO CLIP)

PROKUPECZ: And, look, this is significant, because, finally, we're getting some acknowledgement that perhaps things could have been better here, that the preparation could have been better.

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