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Trump Escalates Against Fed, Says He's Firing Fed Governor; Trump Flexes Power With Threats, Firings and Executive Actions; Massive Dust Storm Sweeps Across Arizona. Aired 7-7:30a ET

Aired August 26, 2025 - 07:00   ET

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

[07:00:00]

JOHN BERMAN, CNN ANCHOR: A sweeping executive order expanding the National Guard's role in law enforcement with plans for specialized units ready to deploy to cities nationwide. The president's plan that could put armed troops on the street near you.

DANNY FREEMAN, CNN ANCHOR: Plus breaking overnight Trump fires a Federal Reserve governor marking a significant escalation in the president's battle against the Central Bank.

And take a look at this right here. We got a wall of dust engulfing Phoenix, near zero visibility, flight delays, power outages, and more people still feeling the impact this morning.

I'm Danny Freeman with John Berman. Kate Bolduan and Sara Sidner are out. And this is CNN News Central.

BERMAN: This morning, President Trump is flexing his presidential power, pushing the limits, and raising questions about whether he is exceeding them. Breaking overnight, he fired Federal Reserve Governor Lisa Cook. There is a word for how rare this is, unprecedented. It has not happened in the Fed's whole 111 year history.

In a letter, the president accused Cook of mortgage fraud, but she has not been charged with any wrongdoing. In response, Cook said the president had no authority to fire her, that she would not resign, and that she would continue to carry out her duties. And make no mistake, this has huge consequences for the economy. It could give the president what political calls a vise-like grip on the direction of the independent central bank.

And in another move testing the limits of his power, the president signed an executive order creating specialized units in the National Guard to quell civil unrest, the clearer sign yet that he plans to expand his military deployments to U.S. cities beyond Washington, D.C., where armed troops are now on patrol. The president has signaled Chicago is the next on his list.

Let's get right to CNN's Alayna Treene inside the White House this morning. Good morning, Alayna.

The firing or the attempted firing because we're just not sure which way this would go of the Fed chair -- or not fed chair, Fed governor, unprecedented.

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Absolutely. I mean, we are, John, in uncharted territory here. You mentioned this, but no president has ever fired a Fed governor before. And, of course, that's because the Fed is supposed to operate independently from the executive branch. And depending on really how this plays out, it's likely this fight is going to the courts. This could give the president far more power and influence over the Fed, how they operate with interest rates than we've ever seen a president have before.

But let's get a little bit into this. Part of what we saw the president do yesterday when he announced that he was attempting to fire Lisa Cook was he said that it was for cause. There's a lot of ambiguity about that. You know, there are legal implications about what for cause actually means. But they stem from allegations that cook on her 2021 mortgage application, this was before she actually was elected to serve as a Fed governor before she had joined, all stemming from whether or not there was, you know, some inappropriate moves on that application. And the CNN review found that she actually listed two properties as primary residences.

But, again, it's very unclear if the president has legal authority to do this and Cook, for her part, argues he doesn't. This is what she said in his statement. She said, quote, President Trump purported to fire me for cause when no cause exists under the law and he has no authority to do so. I will not resign.

But, John, basically the bottom line here, again, is that this is unprecedented and it has huge implications, you know, that could really thrust the independence and the operations of the Fed into question if the president is successful in this move.

And very quickly, this executive order on the National Guard, which sounds like he wants to put National Guard on the streets in other cities pretty quickly.

TREENE: That's right. I mean, I think it's the clearest sign yet, John, of what the president is trying to do here, particularly in using Washington, D.C., as a model for these other cities. And we are seeing this battle reach new heights. And it's exactly how you're describing it. I mean, this is really the president pushing the bounds of his executive authority. And I can tell you from my conversations with White House officials that this is an area where he believes it's worth testing the waters here. He is reveling, I'm told, in the images he is seeing of National Guard troops and federal law enforcement in the streets of D.C. and he wants to take it elsewhere.

[07:05:09]

But we've also seen kind of, you know, him finding a new political foe in this fight where the president sees this as good politics, so too does J.B. Pritzker. He is the governor of Illinois. He's also a potential 2028 Democratic hopeful. Listen to what he said of what the president is trying to do.

(BEGIN VIDEO CLIP) GOV. J.B. PRITZKER (D-IL): Instead, I say, Mr. President, do not come to Chicago.

You are neither wanted here nor needed here. Your remarks about this effort over the last several weeks have betrayed a continuing slip in your mental faculties and are not fit for the auspicious office that you occupy.

This is not about fighting crime. This is about Donald Trump searching for any justification to deploy the military in a blue city, in a blue state, to try and intimidate his political rivals.

(END VIDEO CLIP)

TREENE: So, as you could hear there, John, Governor Pritzker really leaning in to this harsh rhetoric here, but it is providing him with a standup to try and become one of the president's most prominent political rivals on this issue.

All to say we know that for weeks now, the Trump administration has been making plans to try and do what they're doing in D.C. in Chicago, and I know that they're only planning on leaning into this harder, not reining in some of what we've seen with federal law enforcement here in Washington, D.C.

BERMAN: All right. Alayna Treene inside the White House this morning, a lot going on there, so keep us posted.

Let's get right to CNN Senior Legal Analyst Elie Honig. Elie, simple question, I fear it's a complicated answer, but can the president of the United States fire a fed governor?

ELIE HONIG, CNN SENIOR LEGAL ANALYST: Yes. John, I'm going to give you a definitive answer. We don't know, but let me explain why we don't know. So, first of all, there's a law on the books passed by Congress that says the president can only fire a Federal Reserve governor if he has cause. As you just discussed, Trump is citing a claim by a federal agency that Ms. Cook, this particular governor, committed mortgage fraud. She claimed two different homes as a primary residence. Ms. Cook denies that points out that. She's not been charged or convicted of anything.

If the courts find there is good cause, fine, then the firing stands. If the courts find there is not good cause, then Donald Trump is going to make his second argument, which is that law that restricts my ability as the president to fire federal executive branch officials, that is unconstitutional.

Now, John, this goes back to a Supreme Court case from 90 years ago. I know it's one of your favorites. It's called Humphrey's Executor. That said, and I'm using the past tense, that Congress can restrict the president's right to fire certain officials. However, over the last several years, including just a few months ago, the Supreme Court has all but reversed that case, not quite all the way.

And the one potential little hook left is that the Supreme Court has said the Federal Reserve is different. There's a different need for independence there. So, that's why we don't know, John. But the good news is we will find out through this case.

BERMAN: I'm so glad you brought up Humphrey's executor, because if you hadn't, I would have.

Elie, so there are two legal questions here. Number one, if there is cause, number two, what happens if there is out cause? Walk me through how and when and who will decide each part of this.

HONIG: I think this one's going to get up to the Supreme Court real quick and it's going to happen in what we call the emergency docket. Some people call it the shadow docket.

So, Ms. Cook will presumably file a lawsuit challenging her firing real soon, and we will get then a temporary ruling from a federal district court judge. Whoever loses there is then going to ask the Federal Court of Appeals to look at it and whoever loses there is going to ask the U.S. Supreme Court to look at it.

I think that the Supreme Court is very, very likely to take this case precisely because of the constitutional issues that we just discussed. They've shown an interest in these type of issues in the past and it's calling out for clarity.

BERMAN: And just on that clarity, you did mention the Supreme Court did seem to leave this tiny loophole for the Fed. I mean, this court has actually singled out the Fed as an area where the president may not be able to meddle.

HONIG: Yes, exactly. I think that's the best hope for Ms. Cook here. Look, this is a moment for executive power. We have a president who is extremely aggressive in exercising his executive authority. We have a Supreme Court that is very much in line with that. But in their most recent ruling on this topic, the Supreme Court did go out of its way to say the Federal Reserve is different. It goes back to the first and second national banks, and there may be some additional need for some independence there. So, watch for that to become a real turning point in this argument.

BERMAN: So, political, legal, economic consequences, which we'll get to in a little bit, but there is a ton going on here.

Elie Honig, Counselor, great to see you this morning. Thank you very much. Danny?

FREEMAN: All right. Take a look at this incredible video as a massive dust storm sweeps across Arizona. The city of Phoenix engulfed, airport operations halted and thousands left without power. Even the Burning Man Festival was hit by the intense storm.

[07:10:01]

Plus, we have new details in the trial of a family matriarch charged in the murder for hire plot to kill her son-in-law. The critical testimony from a key witness, the defendant's daughter and the victim's ex-wife.

Plus, I'm not about this, a stunt man surfs the San Francisco Bay Bridge. That and much more coming up.

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[07:15:00]

Take a look at this in Arizona this morning. People are still feeling the impact of this massive dust storm, the wall of dust swallowing up phoenix and its surrounding area. Now, the storm darkening and the sky and blinding drivers, this is what it looked like on -- I mean, that's so scary on the roads, near zero visibility for drivers who were urged to pull aside and stay alive.

At Phoenix Sky Harbor Airport, the storm's 70-mile-per-hour wind gust shredded a connector bridge and caused major delays. And the powerful winds in heavy rain that followed cut power to more than 60,000 people, the majority of those in Maricopa County.

Now, all of it comes after a weekend dust storm in Nevada slammed Burning Man, the annual arts festival.

CNN's Allison Chinchar joins us now. Allison, I mean, these images are wild. Can you please break down what we're looking at here?

ALLISON CHINCHAR, CNN METEOROLOGIST: All right. So, again, this is not that uncommon to see in places like the Desert Southwest, and so you have video that will come in looking exactly like this.

So, let's break this down with the time-lapse video behind me. Again, you can see that wall of dust right there coming in to the city, and it comes in very, very quickly. But then you'll notice here, oh, look at all those raindrop, because that's what happens. This haboob, as they are called, the dust storm, is basically the winds out ahead of the actual storm.

So, let's take a look at what we are talking about here, okay, so we can kind of break down on the radar. So, this, we're looking at -- not a current radar, but this is from yesterday. So, we're starting at 8:30, okay? You can kind of see that loop as it kind of comes into the area of Phoenix right through here. So, again, you've got those storms kind of coming in.

This is what happens. So, you get the outflow from the storm, which is all that wind that pushes out ahead of the actual storm, and it kicks up all of that dust that's basically sitting on the ground. And that's what triggers the haboob. But you still have the thunderstorm itself that's behind it. So, oftentimes as soon as the dust comes through, you'll get some rain to kind of clear some of that out.

So, here we go. You can see a lot of these high wind reports. All those blue dots indicate a severe thunderstorm report that came in indicating a very strong wind gust. So, now let's break it down, okay? So, at 8:30 last night, the temperature was 101 degrees in Phoenix, winds gusting maybe up around 20, 25 miles per hour at best. Then you fast forward about 15 minutes, that temperature has now dropped back down to 91. The winds have kicked up to 68 miles per hour. Then you go just a few minutes later, 79 degrees and those winds up to 70 miles an hour. The temperature dropped 35 degrees in 30 minutes, and those winds skyrocketed out ahead of the storm that kind of came in, again, bottoming out at 76 degrees right as the showers themselves were starting to push into the area.

And so that's kind of your timeline there of dealing with it. You get those very strong gusty winds out ahead, pushing all of that dust in, and then you get the rain back behind it cooling those temperatures down.

As we go through the rest of the day though, today, we do still anticipate to have some more showers and thunderstorms coming in, not just to Phoenix, but much of the desert southwest as a whole.

FREEMAN: Man, well, I'm glad to know that at least the Arizonans, they're tough, they've experienced it before, but wild, wild images.

Allison Chinchar, thanks so much. I appreciate you. John?

BERMAN: We'll get a look at more of those images. I got to say those, simply stunning.

IN the Pacific Northwest, firefighters gaining ground in a wildfire that destroyed at least four homes in Central Oregon. Rain and cooler temperatures are helping the 1,200 firefighters working to contain that blaze. In some of California's most famous wineries are holding out hope that the fire there will spare damage to grapes just weeks ahead of harvest. Flames have burned about ten square miles in Napa County. That fire is about 15 percent contained this morning.

President Trump now claims he has not even been briefed about the FBI search at the home of a former national security adviser, John Bolton.

And as the country marks 20 years since Hurricane Katrina, the new warning from nearly 200 current and former FEMA workers.

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[07:20:00]

BERMAN: So, fresh results and apparently some pretty fresh haircuts at the U.S. Open overnight.

CNN's Andy Scholes here with the highlights, and I'm not talking like blonde highlights here this time.

ANDY SCHOLES, CNN SPORTS ANCHOR: Yes, Berman. I think you should try a buzz cut sometime. You know, the 12 years I've been on T.V. with you, you've never changed that hair once. Let's see you. Let's try it sometime.

But Carlos Alcaraz, he went with the buzz cut last time. I like it. It looks much faster. But some others aren't big fans of it. Alcaraz, he played last night before he was walking around. Check out their action from Francis Tiafoe. He saw the buzz cut for the first time. He kind of just stared at Alcaraz's head and joked that he actually thought he looked terrible.

Rory McIlroy, meanwhile, he was also on hand, told Carlos, it was a good look, after giving it a little feel. Alcaraz said he just wanted a fresh start. And so far, so good, at Flushing Meadows, the 22-year- old five time Grand Slam winner beating American Reilly Opelka in straight sets to advance.

Venus Williams meanwhile with a strong return to the U.S. Open, the 45-year-old was taken on 11 Seed Karolina Muchova. Now, Venus dropped the first set, but then stormed back to take the second before eventually losing in three sets.

Now, this was Venus' first Grand Slam match in two years, and just her fourth match overall since she started her comeback in July after 16 months off. Venus, the oldest singles player at Flushing Meadows since 1981.

[07:25:00]

All right, Caitlin Clark meanwhile made a big announcement yesterday. She is now a Nike athlete. And here's a look at her new signature logo. It's got those interlocking Cs. Now something -- it looks very similar to the Gucci logo. See the comparison right there. Clark called Joining Nike a dream come true. Nike plans to release Clark's first signature shoe next year.

In baseball, meanwhile, it was another day, another Cal Raleigh home run, Big Dumper hitting his league 50th home run. He already had the record for homers by a catcher in his season, and now he's joined Mickey Mantle, the only switch hitters that hit 50 or more in a season.

Raleigh is also the A player ever to get to the half century mark in August. He's got 30 games left to try to add all those records. Mariners, they beat Padres last night 9-6.

Well, Matthew Broderick and Allen Ruck we're at again over the weekend, this time instead of a Cubs game, the Ferris Bueller Day off duo we're at a minor league game in Vancouver, Canada, and not undercover this time, saying, take me out to the ball game during the seventh inning stretch.

And Broderick and Ruck, they're actually going to be on the big screen together, John, soon in a new film called The Best is yet to Come.

BERMAN: Life moves fast.

SCHOLES: Pretty cool to see them together.

BERMAN: Yes, life moves fast, as they say at Ferris Bueller.

Andy Scholes, your hair always looks great. Thanks so much.

SCHOLES: I appreciate it.

BERMAN: All right. Not mincing words, the chair of the Democratic National Committee dropped some sharp criticism for his own party.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I'm sick and tired of this Democratic Party bringing a pencil to a knife fight.

(END VIDEO CLIP)

BERMAN: Chilling new testimony, an alleged murder for hire plot, the suspect's son takes the stand.

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[07:30:00]