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Rep. Suhas Subramanyam (D-VA) On Trump Ordering Pentagon To Cut Joint Exercises With Ally South Korea; 100,000 Without Power In Hawaii As Tropical Storm Lala Moves West; Regulators Conditionally Approve Trump Family-Backed Crypto Bank. Aired 7:30-8a ET

Aired August 17, 2026 - 07:30   ET

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

(COMMERCIAL)

[07:30:41]

SARA SIDNER, CNN ANCHOR: This morning we're waiting for reaction from South Korea and Kim Jong Un after President Trump ordered the Pentagon to scale back joint exercises with South Korea. In a social media post just hours before the joint exercises were to begin the president said South Korea declined to help with the war against Iran, and he cited his very good relationship with Kim Jong Un.

CNN's Gage Goulding is in the region, joining me now. Gage, the U.S. and South Korea frequently hold these joint military drills involving thousands and thousands of troops. How is this announcement being received. What is it saying to South Korea?

GAGE GOULDING, CNN INTERNATIONAL CORRESPONDENT: You know, they're right. They are frequent. Actually, they're so frequent they have them every single year. At some point, trainings like this happen multiple times a year.

And President Donald Trump is very familiar with this. Actually, during his first term in 2018 and 2019 - both those years -- he scaled back the operation. And the exercise officially known as Ulchi Freedom Shield is a joint exercise between the United States and South Korean forces. About 18,000 military members with the South Korean Armed Forces join about 28,500 U.S. forces to train for all kinds of things.

And this specific training this year was going to have some advanced modern warfare. Things like GPS jamming, drones, things that we've seen in the conflict between Russia and Ukraine.

Now, I will say this. The South Korean government says that the training -- a 10-day training exercise -- started this morning as scheduled. And they did release a statement where they said that look, they're hoping that the relations between North Korea and the United States can help bring a period of peace for the entire Korean Peninsula.

They also said on the little bit of a jab, if you will, that President Donald Trump gave to the South Korean government -- they said, you know, look, we've been trying to help -- in their words, trying to help with peace and ceasefire in Iran. They also want the Strait of Hormuz to open.

But, you know, the South Korean government is a huge ally to the United States government. And obviously, North Korea and the U.S. is pretty much the exact opposite.

But this post on Truth Social from the president was actually kind of foreshadowed by a post that the president shared of just him and the North Korean leader, saying, you know, it was kind of a mean-mugging picture. But he said look, our relationship is great.

Now, what's really interesting here is that all of this is coming as President Donald Trump has tried or at least appears to have tried to set up some sort of meeting between Pyongyang and Washington, D.C. somewhere. Remember, over his first term in office he met with Kim Jong Un three different times. So far in this term they have not met once.

But again, I don't know if this is an extension of maybe like an olive branch to the North Korean government to try to open up some sort of communication maybe to get a win in the diplomacy area, especially with what's happening with Iran. But it also could be on the other side a message to the South Korean government that hey, we're here to help protect you and keep you safe on the Korean Peninsula. And when we come to ask for help, we expect it off the Korean Peninsula.

So there's kind of a lot of different takeaways here. As for the actual impact, I think that's something we're going to see over the coming days.

SIDNER: Yeah. It's just interesting because North Korea actually does have nuclear weapons and people are very worried about that threat, where Iran does not at this point. It is an interesting conundrum in the way that the international community will be looking at this as well. It hangs in the balance.

Gage Goulding, thank so much for your reporting there from Hong Kong -- Kate.

KATE BOLDUAN, CNN ANCHOR: Let's talk about this. Joining us right now is Democratic Congressman Suhas Subramanyam of Virginia. It's good to see you, Congressman.

What do you think of this move by President Trump scaling back these exercises?

REP. SUHAS SUBRAMANYAM (D-VA) (via Webex by Cisco): I just came back from Korea two weeks ago. I was with a delegation of me, the sole Democrat, and three other Republicans who were all assuring the Korean government that we were a strong ally. That the U.S.-Korea relationship has never been stronger.

[07:35:00]

Certainly, there were some issues to iron out like the treatment of a few American companies, but on defense there were assurances that, you know, this was a bipartisan effort to make sure that the relationship was strong.

And so to come back and two weeks later see the president a week or two after they finally confirmed the ambassador, Michelle Steel, to Korea -- see the president make this move -- I mean, it's clear that Republicans didn't know it was coming. If they did it's embarrassing that they were telling the Korean government this.

So I think it's another example of this president putting extremist leaders and authoritarians over our real allies and alienating allies that we've had for decades who have been there for us and we have been there for them. And it starts -- precipitated by this failed Iran war and the refusal of some allies to go there with us, which I think is reasonable because I, myself, don't want the United States to be in this Iran war. So it's a huge mess and a microcosm of the failure of diplomacy of this administration.

BOLDUAN: Do you think he's doing this as a way of distracting -- of redirecting attention?

SUBRAMANYAM: No. I think this is President Trump waking up on the wrong side of the bed and deciding one day perhaps without the advice of his advisers to try to see if he can get some diplomatic effort with North Korea going again. Because this was clearly not planned or at least known by a lot of people on Capitol Hill on both sides of the aisle, and certainly not by his administration.

This president tends to legislate. He tends to when it comes to diplomacy make decisions on a whim and on his gut. And this is another example of a move that will have unintended consequences for many years to come.

BOLDUAN: He's linking this in part to the Iran war as you were talking about. What he perceives as South Korea not lending enough support.

One thing that we learned this weekend, kind of, is a part of the war with Iran is the CENTCOM commander, Adm. Brad Cooper -- he visited the USS Abraham Lincoln amid reports of poor living conditions and crew members struggling with mental health as a result of a nine-month deployment without port visits.

Cooper's statement about it said in part this. "Of the U.S. Navy's 11 active aircraft carriers, the Lincoln currently has among the lowest number of cases related to mental health." Though saying also, "This doesn't mean that all is perfect."

The president is downplaying concerns -- downplaying concerns about what's going on, on the Lincoln this weekend, though we've heard from family members of those serving who are very concerned and angry.

Does Adm. Cooper's statement make you feel better about what is happening?

SUBRAMANYAM: No. They're downplaying what our servicemembers are going through and it's not isolated to just the USS Lincoln. There are bases where I live in northern Virginia that are seeing servicemembers come to food pantries regularly because they're not getting enough resources on the base to be able to afford groceries or have enough meals to get through the week.

And so this is not an isolate incident. We need to be treating our servicemembers better on the USS Lincoln and across the country, and across the world, and not downplaying incidents where they are not able to, you know, get all the meals they need or -- you know, they're out there for nine months and beyond without any sort of help on the way.

And so we need morale to be better, and this Iran war has hurt morale quite a bit and they need to take responsibility -- this administration.

BOLDUAN: I want to turn your attention to the midterms real quick. Yesterday, the Democratic leader in the House was asked about his -- about the ongoing, kind of, tension and struggle, and we'll call it a -- Democrats like to call it a conversation with -- within the Democratic Party as candidates describe themselves as democratic socialists are picking up wins in primaries and pushing back on leadership.

Let me play you what Hakeem Jeffries now says.

(BEGIN VIDEO CLIP)

REP. HAKEEM JEFFRIES (D-NY): I don't support the DSA agenda as has been articulated by the DSA itself. Now, you're going to have individual members who have been elected in Democratic primaries and if they are elected in the general in November will be part of the House Democratic Caucus. It's going to be a broad caucus.

(END VIDEO CLIP)

BOLDUAN: Are you with Jeffries on this? You do not support the DSA -- their agenda and what it's going to mean in the -- in your party?

SUBRAMANYAM: There are some things I support, like affordability and health care for all, for instance. But I don't support everything they say and they don't support everything I say, but we're still in the same party. I mean, Democrats across the spectrum -- we also have very centrist Democrats, right, who I don't always agree with. And that's OK because we're -- we generally have the same principles, but we have different ways of getting there.

[07:40:03]

What's important is that if we want to win in November, we're going to have to have a broad base. The DSA folks are going to have to be OK with working with the centrists and vice versa. We're going to have to be united if we are in the majority and come together.

The one thing that I would say Republicans have done well as Congress is they have been united because Trump has called them when votes were close and whipped them. So they're the party of Trump now.

We have to be the party of the people and that means, you know, the people have different ideas across the country. What people feel, you know, in the Midwest might be different from what people feel in the South. But we have to have that broad base and that big umbrella in order to govern and be in the majority next year.

BOLDUAN: Congressman Subramanyam, thanks for coming in -- John.

JOHN BERMAN, CNN ANCHOR: All right. With us now, White House correspondent for USA Today, Francesca Chambers, and CNN political analyst and White House correspondent for The New York Times, Zolan Kanno-Youngs.

And Francesca, what about that answer from Hakeem Jeffries on the DSA, Democratic Socialists of America, sort of no, I don't like their platform. Yes, happy to have them if it gives us the majority. It's kind of a fine line there.

FRANCESCA CHAMBERS, WHITE HOUSE CORRESPONDENT, USA TODAY: Exactly. Jeffries is walking a tightrope, John, because you have these democratic socialist candidates who are winning in state blue seats across America. And so if Democrats do retake the House of Representatives and if he does become the House Speaker after November, then he's going to have to work with some of these democratic socialists who are winning as Democrats. As he said, will be part of the Democratic Caucus.

So on the one hand, he is trying to draw distinctions, saying that's not what I personally believe and that's not what all of our members believe. Because he's got establishment folks -- moderate Democrats -- running in places across America where that's a message that won't work while also trying not to turn off these new folks who are joining the party who he's going to have to potentially work with after this.

BERMAN: Zolan, if I can, I want to change subjects for a second because we are getting a little -- a little bit of breaking news. President Trump had a conversation this morning with Trey Yingst over at Fox News about the situation in Iran. And he was talking about the Iranian discussions with Oman, which is the nation, you know, on the Persian Gulf -- an ally of the United States which also sits on the Strait of Hormuz. Oman has been talking to Iran about working out some system for controlling the strait.

The president told Fox, "If Oman gets in the way..." -- again, "If Oman gets in the way, we'll bomb the shit out of them."

That was to U.S. ally Oman. Of course, he's said similar types of things without the "s" word in the past. And I will just note this is a U.S. ally.

Happy 60 days of the memorandum of understanding, by the way, expiring when the U.S. was supposed to be negotiating with Iran.

What does this statement about Oman now tell you?

ZOLAN KANNO-YOUNGS, CNN POLITICAL ANALYST, WHITE HOUSE CORRESPONDENT, THE NEW YORK TIMES: Major -- I mean, that's an escalation, right? We have heard him use that kind of language before but as you noted, this is -- this is a U.S. ally. And an ally, by the way, that was in talks with Iran to try and open the Strait of Hormuz -- this crucial corridor that Iran has increasingly used as a point of leverage to increase the type of economic pressure on the Trump administration.

This comment you can kind of see as a window just into the frustration that President Trump has and that the White House has over a war that has gone on longer than he initially forecasted. He initially, again, said four to five weeks, right, and we're about to get to, what, the roughly six-month mark. And also blow past a deadline that was outlined in a ceasefire agreement that just weeks ago the administration was celebrating as a major breakthrough in de- escalating this conflict. We have not seen that.

What we have seen is that a military assault has now morphed into almost an economic endurance test in between the United States and Iran with the Strait of Hormuz really being that point of tension in the center of that economic endurance test. This has increasingly commanded the president's focus.

And I do think it's worth reminding folks that reopening the Strait of Hormuz, which is the point of frustration behind this comment -- this comment that you're seeing here -- that reopening the Strait of Hormuz was not one of the initial goals laid out by President Trump when it came to starting this war. That corridor was already open before the start of the war. But it is emblematic of the shifting priorities that we've seen as the war has gone on and economic pressure has continued to be imposed on the United States.

BERMAN: And obviously, the situation with Iran is hanging over this political season in which there will be this unusual Republican political convention in September in Texas before the midterms. Listen to what the RNC chair says that will be like.

[07:45:00]

(BEGIN VIDEO CLIP)

JOE GRUTERS, CHAIR, REPUBLICAN NATIONAL COMMITTEE: We're going to put Trump front and center of this convention. It's going to be a Trump-A- Palooza. It's going to be an amazing opportunity for us to basically go out there and tell the American people all the great things that this president has done and all the great things that we're going to continue to do over the final two years of his administration.

(END VIDEO CLIP)

BERMAN: All right. Lightning round, if we can, from both of you. Thirty seconds on what you think this convention might be like and what the open questions are.

Francesca, you first.

CHAMBERS: It's in Texas, so there will be a lot of focus on the Texas Senate race. But, of course, the White House has long believed that Trump is the party's best messenger and that's why not only this convention will be largely about him but every day at the White House he's the one who is largely speaking to the American public in these events that's he having. And so that's what they're learning into with this convention.

But as Zolan was hitting on, this Iran and the economic anxieties that Americans are facing are really hanging over the Republican Party right now, John.

BERMAN: Zolan, if it's all about Trump, does that mean it's great for Republicans, necessarily?

KANNO-YOUNGS: I was just going to say the fact that they're calling this a Trump-A-Palooza speaks to the tension right here. Trump's priorities have not always aligned with the priorities of Republican candidates that are looking towards November. And remember, his approval ratings are pretty low right now so that's going to be the question. Focusing on Trump, is that actually the smart move going into November for the Republican Party?

BERMAN: Zolan Kanno-Youngs, Francesca Chambers, thank you to both of you -- Sara.

SIDNER: All right. Thank you, John.

This morning deadly flooding that's wreaked havoc on the Midwest is finally starting to ease. At least seven people, though, were killed in Indiana where relentless storms flooded homes and businesses and caused rivers to surge.

Meanwhile, some 100,000 homes and businesses are without power across Hawaii as Tropical Storm Lala begins to exit the island. The storm also brought dangerous flooding there. You can see a pickup truck getting pushed around in the rushing water here -- my goodness. That happened just yesterday.

CNN's meteorologist Derek Van Dam joining us now with a look at what's going on there at this hour.

DEREK VAN DAM, AMS METEOROLOGIST: Yeah, Mother Nature doesn't provide refunds for your beach vacation in Hawaii, does it?

Well, we had Hurricane Lala make a very close approach to the Big Island this weekend. It was the heavy rain that caused these -- what were small waterfalls -- to turn into raging torrents of water. Of course, there are people who live near these waterways and unfortunately, over 100 homes have been swept -- or destroyed or swept off of their foundations according to the governor. You can see the water here.

And then you look at the rainfall totals. I mean, this is astounding. We're talking over three feet. Of course, this is in the mountainous areas of the main Big Island. However, this is such a significant amount of rain because that water comes crashing downhill.

And by the way, the Mauna Kea Summit, which stands over 13,800 feet -- it was cold enough up top at that altitude where they actually saw snowfall. So rare mid-August snowfall caused by a hurricane -- a nearby hurricane -- that's saying something.

Wind gusts there, 140 miles per hour. That is incredible. Of course, that's high elevation but still knowing out power for over 100,000 customers.

And here's a look at the latest flood alerts. They've been allowed to expire across Hawaii, but you can see they continue across Kauai and into Oahu. The storm pulling away but there are still outer rainbands impacting the beautiful island of Kauai right now.

This hurricane, or tropical storm at the moment, is going to re- intensify as it gets into more favorable conditions. Fortunately, this will be more of a fish storm going forward. Just another inch or two of rainfall from this departing storm.

The other big story, the heat. You'll feel it if you step outside. It feels like a furnace. You open the door from the air-conditioned house or home or business, and you step outside in Atlanta, it is brutal out there. And it's not only just difficult to cope with these conditions but it's extreme -- we have extreme heat risks and millions of Americans across the Deep South. It's when you factor in the humidity levels that you really start to feel it.

Look at that -- that's not even a typo -- 110 in Jackson, 105 in Atlanta. This is when you start to take the heat seriously, staying out of the sun and staying hydrated as best as possible.

Also Sara, always a good reminder, never leave children or your fur babies unattended in locked vehicles. Very important this time of year.

SIDNER: Absolutely important, especially with those temperatures and the way it feels -- the heat index -- brutal --

VAN DAM: Yeah.

SIDNER: -- in much of the United States.

Thank you so much, Derek Van Dam. We'll talk to you in a bit -- Kate.

BOLDUAN: An elderly man is airlifted after getting lost in a New York park.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We're going to need to figure out a way to get him out of here.

UNIDENTIFIED MALE: And to be totally honest, we might have to hoist him out of here.

(END VIDEO CLIP)

BOLDUAN: We've got more details on what happened there.

Also, a race down a river in bathtubs, of course. (COMMERCIAL)

[07:54:10]

BERMAN: A late-night thriller in the WNBA. Let's get right to CNN's Coy Wire. This one pitted the biggest stars against each other, and it did not disappoint.

COY WIRE, CNN SPORTS ANCHOR: Yes. The Atlanta Dream and Indiana Fever playing in a game with major playoff implications. Love to see it, John.

Caitlin Clark and Angel Reese facing off and giving their chippy history it just always feels like something big will happen. And we got an overtime thriller. Clark, from way downtown in the third, to put the Fever up with three of her 26 points. And watch this, John. Just seconds to go in regulation, game tight and Reese has a chance to win it, but she just can't get it to go.

So we go to overtime and that's where Indiana seals the deal. Kelsey Mitchell putting it out of reach with seconds to go. She finished with 20 in a 95-91 win. Fever with a game and a half lead over Atlanta for the four seed with nine games to go.

[07:55:05]

Scottie Scheffler is world number one and apparently, he'd like to remind everyone why. Scheffler putting the FedEx Cup playoffs in a headlock, finishing 17 under par and eight shots clear of Si Woo Kim.

Next stop, the top 50 head to St. Louis and the final 30 come here to Atlanta. Come on down, John. Eastlake TOUR Championship with a cool $40 million up for grabs. And Scheffler joins Mickelson and Tiger as the only players ever with five or more consecutive multi-win seasons.

Finally, A's rookie Tommy White, AKA "Tommy Tanks," launching the first home run of his Major League career against the Rangers -- a moment you dream about, right, your entire life. You're rounding those bases and you head back to the dugout ready to celebrate with your teammates and Tommy gets nothing. The boys giving him the classic silent treatment. Tommy's like hello? I just hit my first homer. Eventually, they would go ahead and show him some live. They mobbed him. The A's win it 5-2. First career homer -- unforgettable.

BERMAN: Yeah.

WIRE: Getting ghosted by 25 of your closest friends -- yeah, that's priceless.

BERMAN: It is one of my favorite but also one of the meanest traditions in baseball when a rookie hits their first home run for the teams to do that. I kind of dig it but it's also kind of mean.

Coy Wire, thank you.

BOLDUAN: I didn't know that was a thing. BERMAN: It's not every time, but sometimes teams decide to do that. Kind of cruel, right?

BOLDUAN: It's super cruel. Let's do it.

BERMAN: Yeah.

BOLDUAN: Let's figure out some version of that here.

BERMAN: When we have a substitute anchor, we'll just ignore them for the entire show.

BOLDUAN: OK. Don't tell them. It'll be our secret, J.B.

On New York's Long Island, the NYPD stepped in to help rescue a 70- year-old man who had gotten lost in the woods looking for his model airplane. Listen to this.

UNIDENTIFIED MALE: Ok, 24, we have the patient. We're going to need to figure out a way to get him out of here.

UNIDENTIFIED MALE: To be totally honest, we might have to hoist him out of there. 24, 24 to helicopter six. I don't know if anybody notified you, we've got him out of the woods. We're making our way out now.

(END VIDEO CLIP)

BOLDUAN: As you can see, that's exactly what they did. Police say when rescue teams found him, he was conscious and alert and after he was airlifted, he was taken to the hospital where he was evaluated and treated.

And take a look at this. An annual bathtub regatta in Belgium. Competitors row one kilometer on homemade, musically-themed rafts. And the rules require every craft include at least one real bathtub -- fancy. This quirky summer tradition is still going strong. It started in 1982. I'm just, you know, glad it floats -- Sara

SIDNER: Seems like the kind of thing that would sink but they've figured it out.

BOLDUAN: Exactly.

SIDNER: All right. Thank you, John -- John -- good Lord, Kate.

BOLDUAN: I'm back.

SIDNER: I'm in a new world.

All right. New this morning federal financial regulators has conditionally approved a national bank charter for World Liberty Financial. That is the crypto firm partially owned by President Trump's family. The move is facing some pushback from Democrats and raising some big ethical concerns.

CNN's Matt Egan joins us now. What does this mean -- this backing?

MATT EGAN, CNN SENIOR REPORTER: Well Sara, look, this is a big win for World Liberty Financial, the Trump family's flagship crypto firm. As you mentioned, federal regulators have provisionally approved World Liberty to become a bank. Specifically, a trust bank. So they won't be able to take deposits or make loans, but they will be able to oversee and safeguard USD1, which is the dollar-linked stable coin that the firm launched last year.

Now again, this is preliminary and conditional. They do have to clear some other hurdles here but it's a big deal because they will be able to bring all of this in-house and remove the middle man involved here.

Now just for everyone who is not familiar with World Liberty, it was launched by President Trump and his sons, currently run by Zach Witkoff, the son of Middle East envoy Steve Witkoff. And according to The Wall Street Journal, the company is 49 percent owned by a group of investors led by a UAE royal.

Now just to remind everyone how we got here. This firm -- it launched a few weeks before President Trump won the 2024 election and that victory enabled Trump to appoint federal regulators. Now those same Trump-appointed federal regulators are approving a bank charter for a Trump-related firm. Not only that, but those same regulators are going to oversee this bank going forward.

Now as you can imagine, all of this is alarming. Some ethics watchdogs, some of whom worry that this is just going to give corporations and foreign actors another avenue to quietly influence the White House.

I talked to Richard Painter. He was the top ethics lawyer under George W. Bush. And he told me it is "quite precarious to have the president and his family invested so heavily in one of our most important, regulated industries banking at the same time that has power to hire and fire regulators."

Now CNN has reached out to the White House for comment. In the past, the president has defended his crypto profits, saying that he follows the law and that his sons oversee his personal finances while he's in office.