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Blanche Rescinds "Anti-Weaponization" Fund" Will He Get Confirmed?; Trump Calls Off "Massive" Strikes In Iran, Talks To Begin Today; Trump Admin Faces Deadline On A.I. Oversight Framework. Aired 6-6:30a ET

Aired August 03, 2026 - 06:00   ET

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

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BRAD SMITH, CNN ANCHOR: That does it for "CNN HEADLINE EXPRESS". I'm Brad Smith.

CNN THIS MORNING WITH AUDIE CORNISH starts right now.

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AUDIE CORNISH, CNN ANCHOR: Today in the group chat, President Trump's A.G. pick walks back that anti-weaponization fund. But will it be enough to get the Republicans who are against him to approve his nomination?

And has President Trump's repeated warnings lost impact. He threatens Iran, then calls it off for a possible deal. Can they trust it this time?

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DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Well, now, what we're doing is we're talking to them in the form of a negotiation.

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CORNISH: And dangerous wildfires spread in Washington state. Residents flee as the fires grow out of control. Today's forecast could bring relief for crews fighting those flames.

And the Republicans, who are adamant about Graham Platner ending his race now silent on domestic abuse allegations inside the Republican Party. And the question about principle or politics.

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REP. MAX MILLER (R-OH): I'm not getting out of this race, and I'm winning in November.

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SEN. JOHN CORNYN (R-TX): If this were just between me and Todd Blanche, we would have worked this out.

SEN. THOM TILLIS (R-NC): Hey, 158 days. They can try it again. Roll the dice.

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CORNISH: Senate Republicans refuse to blink. But did Todd Blanche just clear the way for himself as attorney general?

Good morning, everybody. I'm Audie Cornish.

We're going to start with new developments overnight on the confirmation process for the president's attorney general pick. The fight was over Trump's $1.8 billion anti-weaponization fund. Senators John Cornyn and Thom Tillis refused to give him the green light until they got it in writing that that fund was dead. Until now, the Justice Department has refused.

Then last night, Blanche posted on social media a letter rescinding the fund. Just a few hours before, Trump was touting that same fund.

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TRUMP: This would be a reimbursement for the pain that they suffered. A lot of people like it. If they don't, if they don't approve Todd, I put it back on the table. A lot of people like it. A lot of big supporters of Trump like it.

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CORNISH: So today in the group chat, Sara Fischer, CNN's senior media analyst and senior media reporter at "Axios". And a new friend, Marc Short, former chief of staff for Vice President Pence and Ashley Etienne, former communications director for Vice President Harris.

So, I'm so glad you guys are here. We're going to talk about a lot.

It was watching Cornyn say we would have worked this out on our own because that's very Cornyn like he's a very institution guy. And Tillis being like, go ahead, try me again.

Why do you think the president keeps pushing this particular issue, even as the backlash is strong enough to prevent, like a lot of things from moving forward?

SARA FISCHER, CNN SENIOR MEDIA ANALYST: Because I think he knows two things can be true at once, that this issue is great for his base. It's his way of saying, come out and support me at all costs and I'll make sure I take care of you.

Remember, there is concerns that this fund could be used to compensate, for example, those that were arrested on January 6th. And on the other end of the spectrum, the other thing that can be true is that it could be putting pressure on his pick for A.G., but I think he knows that he can have the rhetoric go one way and he can have negotiations go another.

And guess what, Audie? That seems to be what's happening.

CORNISH: It does, because Cornyn kind of got what he wants here. They posted this note saying that this anti-weaponization fund, which again was a deal that was only worked out between Trump and the Justice Department directly as a settlement, right? So, there's always been this question of whether or not blanche as his former personal attorney is the right person to have this conversation.

The thing that's interesting is if you actually look in the document, it pretty much says all parties have to agree to changes, which would include Trump. So, help me understand how this is going to work.

MARC SHORT, FORMER CHIEF OF STAFF FOR VICE PRESIDENT PENCE: Well, look, I think the anti-weaponization fund was a terrible idea. The Department of Justice has the ability to give compensation for people who they feel have been wrongly prosecuted already. This is going to be divisive for a lot of people.

Most Americans, as Sara noted, don't want to be funding people who assaulted beat up police on January 6th. I think what's interesting here is that I think there are a lot of senators who are probably hiding behind Tillis and Cornyn, and they wanted them to be out front and. And now that Blanche has met their objections, will other senators step forward, or are they going to now fall in line as well?

CORNISH: Well, there's always the IRS bit, right? According to the documents, he says that the DOJ agreement does not give the president or his family blanket immunity from future tax investigations. Clarification. It's simply an agreement to not pursue any more legal action on the original tax case that led to the settlement.

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So, lots of these like language, legal language changes. Are they enough?

ASHLEY ETIENNE, FORMER COMMUNICATIONS DIRECTOR FOR VICE PRESIDENT HARRIS: Well, I mean, I think that's the IRS settlement was what Trump really wanted out of the deal. I mean, he's got this pattern of presenting sort of two very egregious ideas. And, you know -- the media and Republicans and Democratic opposition lobbying on to one, you know, sort of shielding the real his real intent, which is this IRS settlement.

You know, the one thing I find very interesting about all of this is it all really plays in to the Democrats advantage. It plays directly into our hands. The more that the president continues to focus on, you know, on providing settlement for those who attack the Capitol and attack police officers and trying to shield his family from any sort of future liability, really distracts from what people are really most concerned with. CNN recently put out a poll that showed that 74 percent of the

American people believe that the president is not focused on their priorities. He's mostly focused on himself. And this is another example of that.

CORNISH: So, what he needs --

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ETIENNE: So the more we focus on this, the more it plays out --

CORNISH: For the people who are hiding.

I'm going to play for you John Kennedy of Louisiana, and he had been saying before this Cornyn deal came out that that he wasn't sure about this idea of a bill, some kind of legislation to create the fund instead of the settlement. Here's what he had to say.

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SEN. JOHN KENNEDY (R-LA): The president himself has conceded that it will take legislation. I'm glad he conceded that we'll get to shape the bill if he wants to improve, and I'm willing to look at it, but I'm not going to give him a blank check.

KRISTEN WELKER, NBC NEWS ANCHOR: Do you think anyone who attacked police officers stormed the Capitol on January 6th should get taxpayer money as a part of that fund?

KENNEDY: No, I'd take them off the table.

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CORNISH: So, is it just the January 6th bit?

And, Marc, I have to ask you. You used to work for Vice President Pence, chief of staff. Do you think people would get behind it if they just took off the January 6th, pardoned people?

SHORT: I think that the January 6th part is what is most offensive to a lot of voters.

CORNISH: Bipartisan offensiveness, if you think.

SHORT: Yeah. But I think actually, there's a lot of Republicans uncomfortable with that, too. It's not just a Democrat discomfort. So, yeah, I think that's -- that's the most objectionable part. But again, I think that there's a lot of questions and other questions around this nomination. And so, I think will this all come out this week? Or will this sort of announcement last night in the middle of the night on a Sunday night, sort of put this to bed and allow Cornyn Tillis to step aside.

CORNISH: I'm starting the week assuming this nomination is going to go through eventually, but is that not the scuttlebutt in the text? FISCHER: No, I absolutely think that this is going to go through. And

also remember, the two senators that were holding up here, neither of them are facing reelection. Right. So, at this point, they have so much wiggle room to be able to say and do what they want to go after, but ultimately, they don't want their legacies either, to be the ones that blocked President Trump's hand-picked nominee for attorney general.

So, they're in a -- you know, a contentious position themselves.

CORNISH: Yeah. All right, you guys, stay with me. We're going to talk about more.

Coming up on CNN THIS MORNING, there's new information about that mass shooting at an N-In-Out, how restaurants say a random bystander helped take the gunman down.

Plus, President Trump calls off strikes on Iran. He says he's turning to diplomacy.

And then there's this.

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UNIDENTIFIED MALE: Where is he? He ought to at least have a video, talk to a news organization or something.

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CORNISH: Voters question where's Mitch McConnell? As the deadline to call for a special election to fill his seat arrives.

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CORNISH: So, deal or no deal? President Trump telling reporters on Air Force One last night the U.S. military was, quote, "locked and loaded". But he called off strikes on Iran because our allies asked him to, saying Iran was ready to make a deal. He says talks could start today.

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TRUMP: We're all set to go. But when the allies ask to call it off, you got to sort of say, well, let's see. And the reason they asked is I think there's a deal. And they knew -- they knew the extent of the attack because they saw it forming.

REPORTER: What happens now?

TRUMP: Well, now what we're doing is we're talking to them in the form of a negotiation. It would be the biggest attack since World War Two. And it would have been disastrous for them.

(END VIDEO CLIP) CORNISH: Okay, we've seen some of this before from the president. He starts with a grim warning. This case, biggest attack since World War Two, before it was to obliterate their power plants or to take control of Kharg. Then he backs down.

So, can we trust that diplomacy will work this time around?

Joining us in the group chat, Lieutenant General Karen Gibson, former deputy director of national intelligence.

Thank you so much for being here.

So, the thing that caught my ear in that statement is when he said, our allies asked, and then he sort of shrugged, like, you know, us listening to allies. And I was like, really?

So, help me understand what is it that they want? And who do you think had the leverage?

LT. GEN. KAREN GIBSON (RET.), FORMER DEPARTMENT DIRECTOR OF NATIONAL INTELLIGENCE: So I think certainly our gulf allies are the ones who bear the brunt physically, who bear the risk for the counter-strikes that Iran conducts after each of or prior to our own escalation or our strikes against Iran. And I think they have been urging for some time that we prioritize diplomacy over the continued strikes, which, frankly, have had some questionable efficacy in terms of an inability to move the needle on the Iranian calculus.

CORNISH: All right. You're using national intel speak.

GIBSON: That's right.

CORNISH: What I hear is we're striking. Were using military, and it is not changing Iran's position fundamentally.

GIBSON: That's right.

CORNISH: So, the military thing isn't working. But is the diplomatic thing moving the ball forward in any way? What are you going to be listening for in the next day or two?

GIBSON: So I think one, we haven't heard yet what Iran has to say publicly about this. So, some kind of public response there. I think that our allies, particularly folks like Qatar. And you asked who has the greatest heft to wait?

CORNISH: Yeah.

GIBSON: I think it's probably the Saudis. There is credible reporting that they are the ones that compelled the president to stop. Remember, Operation Freedom, which is where we we're going to physically escort vessels through the strait.

CORNISH: Oh, yeah.

GIBSON: It lasted one day. There's credible reporting that it was the Saudis that convinced him to stop, because they were concerned about attacks on their own infrastructure. And if I could pause for one second and say, I think what Iran has done in the last ten days is shown that their power is not just concentrated on the Strait of Hormuz, but they have the ability to hit gulf infrastructure, as far as Egypt, the Red Sea, et cetera.

CORNISH: That tanker in Egypt definitely --

GIBSON: Yes.

CORNISH: -- was eyebrow raising at that moment. And as you said, they're all of these allies we strike, but they're the ones who get hit right from the counter push from Iran.

GIBSON: Yes.

CORNISH: There was some interesting reporting that CNN had over the last day or two that a senior officer in U.S. central command emailed, this is real, emailed a broad group of military analysts asking for new ideas in the fight against Iran, writing in an email quote, "We're looking for new creative and unconventional ways to pressure and punish Iran."

I love a good crowdsourcing. However, is this unusual help?

GIBSON: Well, crowdsourcing in that fashion is a little unusual, but certainly I could see where doing more of the same thing is unlikely to yield the results that we need. And so --

CORNISH: The analysts have told them this stuff before. Like is -- I help me understand how defense is working right now, that they just -- this to me seems like a constant conversation that should be happening. You shouldn't have to check in a few months down the line and see if anyone's got thoughts.

GIBSON: Yeah, well, I mean, this is one email that we have. It doesn't mean that there haven't been similar conversations going on for some time, just because this is an email that is now come to light. I think military analysts should always and are always assessing how well is this working? What are our adversaries vulnerabilities are we actually stressing those?

And again, I think -- I think its there's some question as to whether just continuing to strike in the way we have is going to do anything different in terms of the way the IRGC is looking at this. Their strategy all along has been to survive, avoid capitulation and make the war so politically and economically untenable for the United States that we back off in some way.

They don't have to defeat us militarily. They just have to survive the strikes. And they think time is on their side. They have a very high capacity for absorbing both economic pain and airstrikes. And I think they still think that they can win.

CORNISH: Can I ask you one more variable? As always, Israel, the chief of the board of peace will arrive in Israel. This is coming days after Trump said that Hamas and all other, sort of groups in Gaza have to disarm. And over the weekend, Israel says it targeted a Hamas weapon storage facility in Gaza, left a crater at a hospital.

Can you talk about how this back-and-forth Hamas, Hezbollah, Israel is going to affect this push to wrap things up with the war in Iraq?

GIBSON: Yeah. So, I don't think they have to be linked. I think Iran did link them earlier in the summer when they said a condition for us to sign the mou is that Israel stop attacking Hezbollah in southern Lebanon. You know, Israel sees Hezbollah as an existential threat to them. And I don't think that's an ally that we can compel to back off..

CORNISH: Israel.

GIBSON: Correct.

CORNISH: Really?

GIBSON: Back off our --

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CORNISH: But you hear Netanyahu saying sometimes like, well, look, we're going to understand the timing of President Trump and things like that -- I mean, at least publicly.

GIBSON: Yeah. But if they feel that their state is threatened, that their nation is threatened by Hezbollah and its weapons, I don't think they will allow Hezbollah to conduct attacks.

CORNISH: So, will there ever be true Abraham Accords? If this is the posture in all directions?

GIBSON: Well, there are Abraham Accords with some nations like the Emirates and Bahrain and --

CORNISH: But I mean, the new push to have other countries.

GIBSON: Yeah. No, I think it would be very politically problematic for the Saudi Arabians to enter the Abraham Accords. You know, they occupy a unique leadership position in both the Arab and Islamic worlds as the custodian of some of the holiest sites, without some kind of concession on the part of the government of Israel regarding the fate of Palestinians in Gaza or the West Bank.

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It really is impossible, I think, for them to normalize relationships with Israel.

CORNISH: Yeah. It sounds like a diplomatic Gordian Knot, to be honest.

I'm glad you're here. Thank you for your help.

That's Lieutenant General Karen Gibson.

Now, after the break on CNN, we're going to check in because there are door to door evacuations as the fires in Greece have exploded in size. We've got a live report from the worst hit area.

Plus, A.I. is technically making your life more expensive. Are the benefits worth the price?

In the meantime, good morning to our friends in Chicago. Look at the sunrise over the skyline.

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CORNISH: So, right now, we're waiting on details from the Trump administration for a new framework that would deal with A.I. development and how the government could be involved.

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Now, 60 days ago, the president signed an executive order directing federal agencies to come up with an oversight plan. The deadline passed August 1st, nothing has publicly been released by the White House. Whatever it is, it is expected to involve basically voluntary participation from A.I. companies.

Now, the administration's reluctance to regulate the industry comes as costs are starting to pile up for you and I. Recent analysis by CNN finding A.I. is already tacking on inflation for everyday goods and services.

So, for example, electricity, computers, phones, game systems, even construction, it's all getting a bit more expensive as A.I. companies are snapping up more power memory chips and construction supplies to fuel the growth of those data centers.

Now, the chief economist at Moody Analytics tells CNN, quote, "The higher inflation means that households must spend just over $375 more to purchase the same goods and services as they did this time last year, and that's due to A.I.'s inflationary impact.

So, joining me now to discuss Maria Curi, tech policy reporter at "Axios".

Welcome back. Always good to see you.

And every time we talk, we talk about how maybe the administration is putting out new rules. Maybe it's not. What are you hearing at this point?

MARIA CURI, CO-AUTHOR, AXIOS AI+ GOVERNMENT NEWSLETTER: Yeah. What we're seeing here is a combination of a technology that is being released faster than ever, a government that is not being transparent about the rules that should be set around it in order to make sure there are safeguards. This is coming at a time, by the way, where the European union has just officially started to enforce its A.I. act. So, what is the U.S. governments plan? And on top of this, as you just mentioned, the technology is resulting in higher costs for Americans without a clear understanding of what the benefits are.

And, you know, we're hearing that this technology is going to inject trillions of dollars into the economy. Who is going to reap the rewards? How are those rewards going to be shared? And who is going to be benefiting -- benefiting from it? And you know, you have A.I. CEOs like Sam Altman with ideas for a public wealth fund or for a four-day work week.

But at the end of the day, a lot of these policy proposals are not picking up steam in Congress or in the White House. And you leave Americans with this combination of lots of costs. What are the benefits? How is it going to impact my daily life for the better?

CORNISH: You mentioned Sam Altman, and over the weekend, a former OpenAI board member was talking to ABC about this question of how do we both encourage development? Because we're in a sort of arms race with countries like China, versus what we need to do here in the U.S.

Let's take a listen. You can respond on the other side.

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HELEN TONER, FORMER OPENAI BOARD MEMBER: It's a really fascinating mindset. The mindset of these top A.I. executives, the way they see it, is that there's a lot of risk here. There's a lot of reason for concern, but if they don't do it, someone else will.

And sometimes they'll say that someone else is China. Sometimes the someone else is a rival U.S. CEO. And so, from their perspective, they don't want to just unilaterally give up because then someone else will win. So that's why they really need the outside help.

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CORNISH: So that question of outside help, it's like, how much voluntary versus involuntary? Can you help me make sense of the kind of conflicting requests from these A.I. CEOs when it comes to regulation?

CURI: These regulations are voluntary on paper, mandatory in practice. If you want to look at an example for why that is the case, look at earlier this year when export controls were slapped on Anthropic, one of the leading U.S. A.I. companies, for not complying with the governments request fast enough and in a timely fashion.

And so, these A.I. companies, you know, they know that they're dealing with an administration that wants to be innovation first, deregulatory. But at the end of the day, there are real concerns among White House officials that if these technologies are running wild with no types of rules at all, it could really result in massive cybersecurity risks. And so, it says voluntary on paper. But expect all of these companies to adhere to what these rules end up being.

CORNISH: Okay. Maria, thanks so much. We'll check in with you as we hope to hear news from the White House about this this week.

CURI: Thank you.

CORNISH: And straight ahead on CNN THIS MORNING, domestic abuse allegations against a sitting congressman. Why he says this is not going to stop him from running for reelection.

Plus, three rejected Republicans now looking for a different path. Is there a new party in the works?

And then take a look at this. The 10th annual dog surfing championship was held this weekend in Pacifica, California. Dogs of all sizes competed in waves alongside their human handlers.

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