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The Situation Room

Interview With Sen. Richard Durbin (D-IL); Epstein Files Deadline; Trump Administration Targets Gender Identity Care; Trump to Sign Massive Defense Spending Bill; Trump Defends Economy in Address to Nation. Aired 11-11:30a ET

Aired December 18, 2025 - 11:00   ET

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

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ANNOUNCER: This is CNN breaking news.

PAMELA BROWN, CNN HOST: Happening now, breaking news: The newest inflation numbers show price increases slowed down last month, but the data may not tell the full story of affordability for many Americans.

And President Trump is expected to sign a massive defense spending bill today -- how one measure could turn up the pressure on the Pentagon to release more information about its strikes on alleged drug boats.

Welcome to our viewers of the United States and around the world. I'm Pamela Brown. Wolf Blitzer is on assignment. And you're in THE SITUATION ROOM.

Now to that breaking news and something certainly being welcomed by both the White House and American consumers, the newly released Consumer Price Index showing inflation has slowed to an annual growth of 2.7 percent. Now, that was smaller than expected, but some economists are also urging caution in that optimism here.

And this comes as President Trump defends his handling of the economy in a prime-time address. He downplayed the strain many Americans are feeling and blamed it all on his predecessor.

So let's begin with CNN's Alayna Treene at the White House.

Alayna, what are you hearing from the administration this morning?

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Well, they are definitely celebrating that new data on these inflation numbers. I actually got a statement recently from the White House press secretary, Karoline Leavitt, doing exactly that.

She told me -- quote -- "America's trending toward a historic economic boom." I should note that is a very similar language that the president also used last night. "Today's report shows that inflation came in far lower than market expectations, a stark comparison to the record high 9 percent inflation crisis caused by Joe Biden."

Again, we heard a lot of this in the president's address last night, very much targeted toward trying to ease a lot of the concerns that Americans have right now about the state of the economy, as you said it, 2.7 percent inflation. That is a number that is lower than expectations and one that is welcome news for this White House.

But I should note that there are still concerns about potentially how the government shutdown -- that was when some of this data was collected, how that could have impacted this process, a lot of economic experts saying, let's look at the next month. That will be the most telling number for where inflation is at this point in time.

I also will tell you, I caught up as well, as some of my colleagues here at the White House caught up as well with the national economic director, Kevin Hassett. And he was asked about this specifically, what the president said last night and his repeated use of his predecessor's name, Joe Biden, trying to lay all of the blame for any kind of economic struggles that people are feeling at Biden's feet.

Listen to what Hassett said when he was asked specifically about, when does it become the Trump economy, not the Biden economy?

(BEGIN VIDEO CLIP)

KEVIN HASSETT, DIRECTOR, NATIONAL ECONOMIC COUNCIL: Well, it's the Trump economy now. Our policies are changing people's lives. But when are we going to be able to point to numbers and say that we fixed the problem, we filled the hole that Biden dug? That will depend on one thing.

(END VIDEO CLIP)

TREENE: So that was a little bit more of a nuanced approach to this rhetoric we're seeing on trying to tackle these economic anxieties.

He's arguing this is a Trump economy, but we inherited what he argued was a struggling economy from Joe Biden. We will have to see when these kick in. And I can tell you this White House is very much hoping that any of the policies that they have done on the economy that they think could help boost it is going to happen quickly.

Because, as we head into next year, we're very close, of course, to January -- that is a midterm elections year -- they need the economy to be better, Pamela, for when voters head to the polls, because this is going to be something that is very much going to determine some of the outlook of that.

And that's really what's been weighing so heavily on this White House and why the president was so fervently focused on this and used such strong language last night to try and convince Americans essentially that they should be feeling good about the economy, even when many of them are saying they don't.

BROWN: All right, Alayna Treene live for us from the White House, thanks so much. [11:05:02]

And many Americans who turned into President Trump's speech last night, as Alayna just pointed out, may have felt some disconnect, right? The pinch that they are feeling on their paychecks and savings wasn't necessarily reflected in the president's rosy assessment of the economy.

Let's listen.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: When I took office, inflation was the worst in 48 years, and some would say in the history of our country.

The price of eggs is down 82 percent since March, and everything else is falling rapidly. I negotiated directly with the drug companies and foreign nations, which were taking advantage of our country for many decades, to slash prices on drugs and pharmaceuticals by as much as 400, 500, and even 600 percent.

Our border is secure. Inflation is stopped. Wages are up. Prices are down.

(END VIDEO CLIP)

BROWN: And even before the president wrapped up his speech, CNN senior reporter Daniel Dale went to work. And he joins us now with a CNN fact-check.

So, Daniel, how did the president rate in accuracy last night?

DANIEL DALE, CNN SENIOR REPORTER: Very poorly.

These were a lot of the same claims that have been debunked over and over after presidential speeches for months, but the president keeps making them. So, he hasn't secured $18 trillion in investment this year. He hasn't settled eight wars and so on. I could go on at length.

But the claims that really stood out were on the economy and inflation. So, it is not true -- you heard him say their inflation has stopped. Prices are down. We had 2.7 percent inflation in November, as our reporter said. That was a welcome reduction from 3 percent in November. But it's happening. Inflation is happening.

It hasn't stopped. Prices continue to rise. He again said he inherited the worst inflation in history. He inherited 3.0 percent inflation in January. And even the Biden era peak, 9.1 percent, was not close to an all-time record. It occurred more than two years before President Trump came back to office.

And you heard him say that egg prices have plummeted, which is true, although consumer prices are not down 82 percent since March. But he then said everything else is falling rapidly.

Excuse me.

That is not true, even if he's talking about groceries. Dozens of grocery items have increased in price. Far more grocery items have increased than have decreased. And, overall, average grocery prices have increased during this term. So, this claim he keeps making that every price is down, all prices are falling rapidly just not borne out by the economic data we have.

BROWN: And also, last night, President Trump spoke of reducing the cost of pharmaceutical drugs, but that also included some interesting mathematical claims. What can you tell us about that?

DALE: The numbers don't make sense. He keeps saying them. You said he's -- his executive order, most favored nation prescription drug pricing, bringing down prices by 400 to 600 percent. You can't have a reduction of more than 100 percent, because if you did a more than 100 decline, that would mean that Americans would be getting paid, getting money, not paying money, to acquire their medications.

We know that isn't happening. So the president does have some scattered drug price reductions he could tout. We have heard him announce deals about reducing prices of particular drugs with drugmakers. So I don't know why he doesn't refer to those, instead of using these numbers that just do not make sense whatsoever.

BROWN: All right, Daniel Dale, nice to see you, as always. Thank you so much.

DALE: Thank you.

BROWN: And happening today, President Trump is expected to sign a massive $900 billion defense spending bill, and it includes a 3.8 percent raise for military personnel.

It also puts new pressure on the Pentagon to provide more information about those reoccurring attacks on alleged drug boats. The latest strike came just yesterday in the Easter Pacific, killing at least four people. Nearly 100 people have been killed since these attacks began in September.

So let's go live now to CNN senior national security reporter Zach Cohen to learn more.

So what do we know about this latest attack on an alleged drug boat, Zach?

ZACHARY COHEN, CNN SENIOR NATIONAL SECURITY REPORTER: Yes, Pam, this is the second such strike that has been announced by the U.S. military just this week.

And the four killed in this strike brings us to at least 99 people that have been killed in these strikes against alleged drug boats since September. That is the extent of this campaign, this ongoing campaign that continues to raise questions, both about strategy and legality, and this strike coming as there's fresh questions about what is the endgame here for the Trump administration? We have seen President Donald Trump this week announce a total and complete blockade of sanctioned oil tankers coming to and from Venezuela, coupled with that interview with "Vanity Fair" done by White House Chief of Staff Susie Wiles, where she suggests that the ultimate goal here is to push Nicolas Maduro, the leader of Venezuela, out of office, really raising more concerns on Capitol Hill that this is all about potentially regime change, and not just about stopping the flow of drugs coming to the U.S. from Latin America.

So those questions are unlikely to cease here as the U.S. military continues to target boats both in the East Pacific and in the Caribbean.

[11:10:05]

BROWN: And the defense spending bill calls for more transparency about the boat strikes from the Pentagon. What more do we know about that?

COHEN: Yes, lawmakers on both sides of the aisle have been incredibly frustrated with Defense Secretary Pete Hegseth and the lack of information and details that they have received from the Pentagon about this campaign.

And they're making that clear in this spending bill, tucking in a provision that would limit Hegseth's travel expenses if he does not provide the relevant committees on the Hill with that unedited video from the September 2 strike, the one that is really at the center of these allegations that the U.S. committed a potential war crime by killing two survivors from that initial strike.

And, look, it also demands that Hegseth hand over other documents, including the execution order for these strikes as well. And, look, Admiral Bradley, the commander who oversaw that September 2 strike, was back on the Hill briefing lawmakers yesterday. And he was asked, along with other military commanders asked during that briefing, if there's a reason why the Pentagon cannot release that video.

Take a listen to what Congressman Jason Crow said, a member of the House Armed Services Committee, about that exchange.

(BEGIN VIDEO CLIP)

REP. JASON CROW (D-CO): I was very clear in asking the commanders today whether or not there was any reason they could not release the video. Their answer is very clear. No. They could prepare this video for release, just like they have every other video.

(END VIDEO CLIP)

COHEN: So that would seem to contradict what Defense Secretary Pete Hegseth has said publicly just this week, claiming that it's longstanding practice with the Department of Defense not to release unedited videos of these strikes, despite the fact that he has released clips from this strike and all the subsequent ones already. So it remains to be seen if this ramped-up pressure will ultimately

result in that unedited video being released, but the Congress clearly using the tools at its disposal to try to push Hegseth to do so.

BROWN: All right, Zach Cohen, thanks so much for the latest there.

And still ahead here in THE SITUATION ROOM: The Justice Department has until tomorrow to release its files on convicted sex offender Jeffrey Epstein.

Also, millions of Americans will see their insurance premiums skyrocket next year, and Congress is rapidly running out of time to do anything about it.

Top Senate Democrat Dick Durbin joins us in THE SITUATION ROOM to discuss these alarming deadlines.

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BROWN: Happening now: The Trump administration is expected to make an announcement shortly outlining new steps that will essentially ban some gender identity care for children in federal programs, even in states where such care is still legal.

You see the HHS secretary right there at the podium gearing up to make that announcement.

I want to go live now to our Jacqueline Howard to learn more about this -- Jacqueline.

JACQUELINE HOWARD, CNN HEALTH REPORTER: Yes, Pamela, as you mentioned, this is all unfolding right now.

But what we're hearing is that two proposed rules may be announced. One, we're hearing that the Trump administration may prohibit doctors and hospitals from receiving federal Medicaid reimbursements for medical care provided to transgender youth younger than the age of 18. That's one proposed rule.

Two, we're hearing that the administration may block Medicaid and Medicare funding for services at hospitals that provide gender identity care to children. So those are two proposed rules that we may hear announced soon.

But when you look at the overall landscape of care, Pam, 27 states so far have passed bans on transgender care for children and teens. And it's estimated that about half of transgender teens live in a state that has enacted a law or some type of policy limiting access.

But these proposed rules, they will be a national landscape, so they would essentially override state policies. And that's what we're keeping an eye on now when it comes to Medicare and Medicaid funding. So, again, Pam this is all happening at the moment.

BROWN: All right, and we will continue to track this announcement.

Jacqueline Howard, thank you for bringing us the latest on that.

And happening now: Survivors of Jeffrey Epstein's abuse and the American public are anxiously awaiting the release of the Epstein case files ahead of tomorrow's deadline for the Justice Department to do so.

And there is new outrage from those survivors after Epstein accomplice Ghislaine Maxwell launched a Hail Mary bid to overturn her conviction for child sex trafficking and other crimes. New court documents filed yesterday claim evidence emerged showing Maxwell did not receive a fair trial.

Joining us now to discuss this and more is Senate Minority Whip Dick Durbin of Illinois. He is the top Democrat on the Senate Judiciary Committee.

Nice to see you, Senator.

What is your reaction to this latest move by Ghislaine Maxwell to get her conviction wiped away?

SEN. RICHARD DURBIN (D-IL): Well, I tell you, it's an outrage.

This administration has refused to disclose the Epstein files. They had to be forced into that position by Congress. And now to think that they're going to somehow change her sentence to give her a different treatment because of her interview with the White House is outrageous.

BROWN: Right. And just to be clear, it was her lawyer who filed this asking the judge to overturn her conviction. So we will continue to cover that closely.

[11:20:05]

And, as you heard in that interview with Susie Wiles to "Vanity Fair" -- or you read, I should say -- she claims the administration didn't know anything about her transfer to that other facility. What was your reaction to that?

DURBIN: Hard to imagine anyone who was that notorious -- and her conviction and trial were certainly the subject of headlines across the United States -- could be transferred to a minimum-security setting, a preferred setting for the prisoners, without the knowledge of the White House.

BROWN: We are approaching that deadline for the Justice Department to release the Epstein case files required by the law that Congress passed nearly unanimously last month.

Do you have any updates from the Justice Department on when exactly or how it plans to do that?

DURBIN: They have been very secretive about their plans. And I don't know what they're going to do. I'm skeptical when you consider the lengths they went to hide these files from the American people. I'm not sure when they're going to be released, how they're going to be released, what's going to be redacted or whether we're going to see them in their entirety.

But I have this warning to the White House. We have plenty of people who worked on this case who know the details of the case and the complete record. And if they give us something that's incomplete, we can hold them accountable.

BROWN: And how do you plan to hold them accountable if what you get is, in your view, incomplete?

DURBIN: The most powerful way possible in a democracy, take our evidence to the American people. If they want to hide the information, the truth in the files, they're not going to get away with it.

BROWN: How confident are you that the DOJ will in fact release all of the Epstein files?

DURBIN: I'm not.

(CROSSTALK)

DURBIN: I'm not confident. Look at the lengths we had to go to after they promised to turn over these files to finally get it to happen.

It took something that's extraordinary in the procedure of Congress, in that we were going to come together and have a discharge petition in the Republican House of Representatives. That's an indication of how far we had to travel to get this much information was available.

BROWN: And you indicated that people who have been working on this, who understand what's in the files -- I mean, what can we expect tomorrow with the release of these Epstein files? Is there -- are there things in there that might be shocking to people? What more can we expect?

DURBIN: I don't know. I honestly don't know the answer.

But I do know the circumstances. This administration has gone to the greatest possible political lengths to conceal this information from the American people. There must be something awful in there.

BROWN: Well, we will wait and see once those files are released.

As you know, as we pivot to health care now, another really important issue, four House Republicans yesterday decided to break with their party's leadership and sign on to a Democratic effort to force a vote on an extension of those enhanced Obamacare subsidies.

Do you have any indications that Senate Majority Leader John Thune will even consider putting this on the Senate floor if and when it gets through the House?

DURBIN: I don't know the answer to that because I have not spoken to him or heard what he said, but I do know this. We had a meeting earlier this week, a few days ago, a bipartisan meeting of senators.

There were at least a dozen Republican senators who were trying to find a way to stop this dramatic increase in health insurance premiums across America. So, I know the political sentiment goes beyond the four who actually voted with us to bring these premiums down.

We have others who are trying to find a way to do it in the Senate. The four in the House, the four Republicans who stepped up and are calling for the discharge of this petition, I think indication there may be even more.

Let's boil it down to the bottom line. Across America, families are scared to death that their premiums are going to double and triple because of the failure of Congress to act. We have no excuse. We need to do it as soon as possible when we return in January.

BROWN: So what is your reaction to the fact that Speaker Mike Johnson said the House vote on those Obamacare subsidies will not happen until after the House returns from the holiday recess in January? And, of course, that would be after the subsidies expire. How much does that concern you?

DURBIN: Well, it does concern me.

But I have to say to these families, when we discuss this on a bipartisan basis, we're trying to find a way to hold them harmless if our action is taken after the 1st of the year. We can make this right, but we need to do it on a bipartisan basis. And the Republicans finally have to come around and cooperate with us. I think they will do it.

BROWN: All right, we will see. We will wait and see.

Before you go, Senator, the U.S. military conducted another strike against an alleged drug boat in the Eastern Pacific yesterday, this one killing four people, according to the Pentagon. Venezuelan President Nicolas Maduro says the Trump administration wants regime change. Susie Wiles, for her part, hinted at that in her interview with "Vanity Fair."

What do you make of that assessment?

DURBIN: I have no doubt that that's the real motive. Certainly, stopping the flow of narcotics into this country is one of our highest priorities as a nation, but I believe that this is personal to Maduro. They want to replace him.

[11:25:08]

I have no use for the man as a leader in this country, but we ought to have more candor and disclosures from this administration exactly what they're setting out to do. We have gathered this armada. We have troops ready for a land invasion. We are preparing for war, and the American people have not been part of this decision process.

The Constitution requires that, and we should require it of the Trump administration.

BROWN: All right, Senator Dick Durbin, thank you for your time, and happy holidays.

DURBIN: Thank you. Happy holidays to you, Pam.

BROWN: Up next in THE SITUATION ROOM: why the number two at the FBI is stepping away after less than a year on the job.

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