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New Info On 1/6 Criminal Probe As DOJ Looks At Trump's Actions; Fed Hikes Interest Rates Another 0.75 Percent In Drastic Move Against Inflation; U.S. Makes Russia A Substantive Offer To Release Griner, Whelan; Manchin Says Deal Reached With Schumer On Energy And Health Care Bill; Pelosi's Potential Trip to Taiwan Sparks Security Concerns; Biden Out Of Isolation After Testing Negative For COVID. Aired 6-7p ET

Aired July 27, 2022 - 18:00   ET

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

[18:00:00]

JAKE TAPPER, CNN ANCHOR: But to add insult to injury, some Twitter users claim they have spotted the Renaissance album on sale early in Europe.

This is Beyonce's first full-length album since Lemonade in 2016 and I'm told she remains the undisputed queen.

If you ever miss an episode of The Lead, you can listen to The Lead wherever you get your podcasts. Our coverage continues now with Mr. Wolf Blitzer right next door in a place I like to call THE SITUATION ROOM. See you tomorrow.

WOLF BLITZER, CNN ANCHOR: Happening now, new information about the Justice Department's criminal investigation of January 6th, as federal prosecutors are now looking at the actions of former President Trump.

Also tonight, Americans are bracing for even higher mortgage rates and other borrowing costs after the Fed takes drastic new action to curb inflation, raising interest rates three quarters of a percentage point for the second time in two months.

And the Biden administration says it has made a substantial offer to Russia to secure the release of Brittney Griner and Paul Whelan. CNN learning exclusively that the U.S. is now proposing a deal to exchange a convicted Russian arms dealer for the two Americans.

Welcome to our viewers here in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

We begin with new evidence that the Justice Department's criminal investigation of January 6th is picking up steam big time. A star witness from the House hearings is now cooperating with federal prosecutors who have been asking questions about former President Trump.

Let's go right to our Congressional Correspondent Ryan Nobles, he's up on Capitol Hill. Ryan, tell us about this key witness who is now working with the Feds. RYAN NOBLES, CNN CONGRESSIONAL CORRESPONDENT: Yes, Wolf. It is the witness that perhaps delivered the most compelling testimony of any of the January 6th select committee's public hearings, and that's the former aide to Mark Meadows, Cassidy Hutchinson.

And the fact that Hutchinson is now cooperating with the Department of Justice shows that this probe is expanding, specifically into the efforts to stand in the way of the certification of the election results and perhaps inching even closer to the former president, Donald Trump.

(BEGIN VIDEOTAPE)

NOBLES (voice over): The Department of Justice investigation into the events that led to January 6th is expanding at a rapid clip.

ALYSSA FARAH GRIFFIN, CNN POLITICAL COMMENTATOR: I am aware of other White House officials who have been reached out to by DOJ and are planning to cooperate.

NOBLES: Former White House Staffer Alyssa Farah telling CNN that DOJ has reached out to more former officials in the Trump White House, beyond just Marc Short and Greg Jacob, two top aides to former Vice President Mike Pence, CNN now learning that Cassidy Hutchinson, a former top aide to Trump's chief of staff, is just the latest official from the last administration to start cooperating with the DOJ's criminal investigators.

GRIFFIN: And I think DOJ is keeping an eye on who is coming from January 6th and who may have helpful information.

NOBLES: The news comes at the same time sources tell The Washington Post and The New York Times that federal investigators have asked questions specifically about Donald Trump's actions, suggesting their probe is getting closer to the former president himself, all while a separate state level investigation is looking at Trump and election interference in Georgia.

NORM EISEN, CNN LEGAL ANALYST: You see a pincers movement on Donald Trump, and perhaps this will be the occasion in which he cannot dodge criminal liability.

NOBLES: The public posture of the DOJ is welcome news to members of the January 6th select committee who have been publicly pleading with federal prosecutors to take action.

REP. JAMIE RASKIN (D-MD): That encourages me or it solidifies the understanding I have always operated with, which is that the Department of Justice has a vast arsenal of resources at their disposal. These are extremely competent, effective lawyers. They know what they're doing.

NOBLES: However, there is no question the political calendar and a pending presidential announcement by Trump could complicate their plans. And Trump continues to show no sign he is backing down.

DONALD TRUMP, FORMER U.S. PRESIDENT: Now, we have the January 6th unselect committee of political hacks and thugs.

NOBLES: But Attorney General Merrick Garland pledged that nothing, including political pressure, will impede their investigation.

MERRICK GARLAND, ATTORNEY GENERAL: We will hold accountable anyone who is criminally responsible for attempting to interfere with the transfer, legitimate lawful transfer of power from one administration to the next.

(END VIDEOTAPE)

NOBLES (on camera): And another sign that the Department of Justice is getting serious, they have obtained a search warrant for the phone of John Eastman, the conservative lawyer who was behind the pressure campaign against former Vice President Mike Pence. Of course, several weeks ago, federal investigators stopped Eastman and searched him at the time. They obtained his cell phone at that time. This is now them asking a judge if they can search the phone, showing, Wolf, that they're very interested in the role that Eastman played in the effort to overturn the election results. Wolf?

BLITZER: Yes, that's potentially a very significant development as well.

[18:05:01]

Ryan, stay with us. I want to bring in CNN's Chief Legal Analyst Jeffrey Toobin and CNN Senior Legal Analyst Laura Coates right now.

Jeffrey, this warrant for John Eastman's phone, cooperation from key Trump White House insiders, what does it say to you we're getting all of these new details right now about this federal criminal investigation?

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: Well, this is really a dramatic change from what we knew for sure just a few days ago. I mean, there had been hints that this investigation has been going on for months. But now we know for certain. And this is a very different investigation than the one that brought hundreds of people to be prosecuted for the actual invasion of the Capitol.

These are crimes, if they are crimes, that took place in the White House, in the Oval Office. These are investigations of the president and the people immediately around him. That's clearly now going on. Whether there will be crimes disclosed, whether there will be indictments is a separate question but there can't be indictments without an investigation, and we know now there is an investigation.

BLITZER: It certainly is. Laura, according to both The Washington Post and The New York Times, federal prosecutors are asking specific questions about former President Trump himself. How significant is that?

LAURA COATES, CNN SENIOR LEGAL ANALYST: It's very significant. Normally, we're talking about asking questions not as part of a let me get the lay of the land, but the specificity to me describes that they have already had information from other sources. Maybe they're trying to compare and contrast, fill in particular holes.

Remember, just a few weeks ago, you had the DOJ and the committee engaged in sort of a letter campaign against one another, not trying to be antagonistic, but the idea of the DOJ wanting the information that the committee had, wanting to have what other transcripts they may have. Why? We now know it's likely because they were trying to essentially decide whether the people they have either already interviewed or intend to do so will have credibility issues, whether it's consistent in some way. You want to dot those Is and cross those Ts lose the way.

But to have specific questions of the former president of the United States in asking this question that says they're much farther along in trying to substantiate and corroborate as opposed to just get foundational information. It's not the beginning of the investigation, in other words, we're very far along.

BLITZER: Jeffrey, how much of an uphill battle would the Justice Department face if it were to decide to formally officially indict the former president, Trump?

TOOBIN: It would be a very complex prosecution. One issue that I think is off the table is the one of can you indict a sitting president. That is a Justice Department policy going back to the Nixon years, which says you can't indict a sitting president. Donald Trump is no longer a sitting president. So, I think that issue is not going to be a hindrance to the Justice Department.

But there are very complex constitutional issues here. What was free speech on the part of Donald Trump as opposed to a conspiracy to engage in illegal activity? John Eastman was providing legal advice. How much legal advice is within the ambit of just taking a shot and how much is actually encouraging someone to violate the law? Those are very hard questions that need to be resolved. But the way you resolve those questions is by collecting evidence. And that's what they're doing. And once they have collected enough evidence, they'll decide if there's a prosecutable case here.

BLITZER: Let me follow up with Laura. Laura, as this investigation clearly inching closes and closer to the former president, would Trump be mistaken to think another presidential run could offer him at least some protection from legal consequences?

COATES: Yes, he would be mistaken. Remember, the sort of unspoken rule and one that is part of the Justice Department is to not put their thumbs on the scale of an actual upcoming election. Not wanting to somehow influence voters by having the notion that one is guilty by virtue of being in the court of public opinion and having that presumption of innocence not mean a lot to voters.

But remember, as much as Donald Trump may be casting a shadow and be very influential perspectively on how voters look at the midterms, he's not actually on the ballot. So, the idea you have once been a president and might once run again as president, you would not have the immunizing factor indefinitely to say, hey, as long as you have the prospect of running, you can never be held to account. That would be a grave error and one that I hope his lawyers are not instructing him on.

TOOBIN: Just to add one point there, Merrick Garland was asked that very question by Lester Holt in his NBC interview yesterday, and Garland could not have been clearer that the fact that someone might be running for president is not something that gets him immunity from being prosecuted.

[18:10:00]

So, I think that issue really is off the table.

BLITZER: Yes, no one is above the law, that's what he has said before. That's the gist of what's going on right now.

Ryan, I know you're doing a lot of reporting up there on the Hill. How are the Justice Department and House select committee navigating these overlapping investigations? It's really obviously a very sensitive issue.

NOBLES: It is, Wolf, but it does seem as though the committee and the Department of Justice have kind of put aside their differences and are now much more cooperative than they were in the past. Committee members say that they're open to helping the Department of Justice in any level that they can. They're still being very proprietary over the information that they have already uncovered but they're coming up with a system to allow the Department of Justice to have access to that. We don't know at what level the Department of Justice has obtained that information but they're no longer adversaries, as they appear to be just a couple of months ago.

BLITZER: All right, interesting. Ryan Nobles, Jeffrey Toobin, Laura Coates, guys, thank you very, very much.

An important note to our viewers, be sure to join Laura later tonight as she anchors CNN Tonight, 9:00 P.M. Eastern.

Just ahead, the Federal Reserve takes a historic action to tame inflation with another huge interest rate hike. What it means for American consumers, that's next.

(COMMERCIAL BREAK)

[18:15:00]

BLITZER: Tonight, the Federal Reserve is taking unprecedented and aggressive new action to tame inflation, hiking interest rates by three quarters of a percentage point for the second time in two months.

Our Brian Todd is just outside the Fed here in Washington. Brian, tell us more about this rate hike and how it impacts consumers and the economy.

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, American consumers are now dealing with their fourth interest rate hike of the year. We have new information tonight on how they'll be feeling it with their mortgages, car loans and credit card debt.

(BEGIN VIDEOTAPE)

TODD (voice over): At his pawnshop in the Kansas City area, Denny Russell sees a lot of new customers these days, people dealing with runaway inflation, selling off their personal items just to make ends meet.

UNIDENTIFIED MALE: We still have people coming in every day that have never seen this place before.

TODD: The Federal Reserve is desperately trying to tame inflation in America, again, raising interest rates three quarters of a percentage point. It's the fourth interest rate hike in America this year, and Fed Chairman Jerome Powell says there could be more coming.

JEROME POWELL, FEDERAL RESERVE CHAIR: Inflation has obviously surprised to the upside over the past year and further surprises could be in store. We therefore will need to be nimble in responding to incoming data and the evolving outlook.

TODD: Analysts say this means higher borrowing costs for many Americans.

RANA FOROOHAR, GLOBAL BUSINESS COLUMNIST AND ASSOCIATE EDITOR, FINANCIAL TIMES: It's going to make getting a mortgage more expensive, it's going to make paying off credit card debt more expensive, auto payments, et cetera. So, those pressures, particularly for people that have any debt at all, are going to rise.

TODD: Rising interest rates have already been jacking up the cost of our mortgages for months. In the week ending July 21st, the rate for a 30-year fixed rate mortgage in the U.S. averaged 5.54 percent. Last year, at the same time, it was under 3 percent.

Analysts say the effects of this latest rate hike on homeowners or prospective home buyers could be mixed. One expert says those people may not feel the pinch immediately because many banks had already figured these latest interest rate hikes into the rates they were charging.

DAVID WILCOX, PETERSON INSTITUTE FOR INTERNATIONAL ECONOMICS: If you're a homeowner in the market today, you have already seen your opportunities limited by what's gone on. House prices are up a lot and mortgage interest rates are up a lot. So, you may have already had to adjust your home buying budget.

TODD: But others say the downside is that rate hike after rate hike while inflation persists could start to catch up with people.

FOROOHAR: That's the possibility that you're going to start seeing more defaults. You're going to see people finally being unable to pay their bills. And so those auto loans that have been sliced and diced in the way things were back in the financial crisis, those are going to start going bad.

TODD: How can the average American consumer cope with these rate hikes?

WILCOX: Be more stringent on your family budget. Set aside some of the discretionary expenditures. Avoid borrowing for something that you could splurge for later on when you've got already an extra cash cushion set aside.

(END VIDEOTAPE)

TODD (on camera): The analyst we spoke to say that means don't borrow money for things like vacations and they're giving the same advice tonight that they have given Americans throughout all of these rate hikes this year. Pay off your credit card debt or at least try to pay it down as much as you can. Wolf?

BLITZER: All right. Brian, thank you, Brian Todd reporting for us.

Let's get some more on all of this. Joining us now, CNN White House Correspondent M.J. Lee and CNN Reporter Matt Egan, he's over at the Federal Reserve as well.

Matt, where will this historic and aggressive rate hike hit Americans the hardest?

MATT EGAN, CNN REPORTER: Well, Wolf, these dramatic steps from the Fed are going to be felt by virtually all Americans. It means that borrowing costs are going up at the fastest pace in decades. The days of dirt cheap financing are clearly over. Car loans are getting more expensive. It is pricier to have a credit card balance and carry it over, and, yes, mortgage rates are basically double where they were a year ago. And that is forcing some people out of the housing market.

Now, the fed is trying to cool off red hot demand across the economy, not just in the housing market. The goal is to try to give time for supply to catch up. And they're trying to get ahead of this worse inflation crisis in 40 years, trying to ease the sticker shock that families are feeling at the grocery store, at the gas station, and at the mall. But here's the problem, the economy is already slowing down.

And Jerome Powell, the Fed chair, he conceded today we could see a further slowing because of these rate hikes. So, they face this dilemma. If they're too timid, inflation could become entrenched in the economy. And if they're too aggressive, they could cause the very recession that they're trying to avoid.

BLITZER: Yes, they certainly are. M.J., you're over at the White House. How is the White House responding to these developments?

M.J. LEE, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, as you know very well, inflation is an issue that has really consumed White House officials, including, of course, the president.

[18:20:00]

This is the issue that the president has often talked about as being his number one domestic priority. Now, it's very important to note that the actions that the Federal Reserve is taking, raising interest rates, that that is entirely separate from the White House and from the president. And that is why the president has said in recent days that there is nothing that he is going to do to try to sort of pressure the Federal Reserve, that it is really up to the central bank to take whatever actions that it is going to take, and act independently.

But, look, I think on the one hand, the White House is very cognizant that the actions that the Fed is going to take, that they're going to be very important to trying to bring down inflation and sort of complement some of the actions the White House has taken, particularly on the gas prices front.

But I do think there is also recognition on the other hand that, yes, there is always going to be the risk that the Federal Reserve might act a little too aggressively and that could play a hand and have a role in slowing down the economy a little too much, and that it is a really delicate balancing act, Wolf.

BLITZER: It certainly is. And, Matt, as you heard the Fed chair, Jerome Powell, isn't ruling out another what he calls unusually large rate hike, maybe as early as next month. How high should Americans be bracing for interest rates to go?

EGAN: Wolf, the Fed has made clear that they're nowhere near ready to declare victory with this war on inflation, so, yes, we should be expecting further rate hikes ahead. Now, maybe if the economy starts to really show signs of a significant slowdown, if inflation really cools off, then perhaps the Fed could at least pause these rate hikes later this year. On the other hand, if the jobs market stays hot, if inflation stays hot, we could see even more aggressive steps ahead. Wolf, the stakes could not be higher for the American people right now.

BLITZER: You're absolutely right. Matt and M.J., guys, thank you very, very much.

Coming up, CNN is now learning exclusive details about a U.S. offer to release Brittney Griner and Paul Whelan from Russian captivity. We're also hearing directly from Griner as she takes the stand in her own defense.

(COMMERCIAL BREAK)

[18:25:00]

BLITZER: Major new developments tonight in efforts to get Americans Brittney Griner and Paul Whelan released by Russia. CNN has learned exclusively that, in exchange, the United States is now offering to release a convicted Russian arms dealer.

CNN Senior International Correspondent Fred Pleitgen is working the story for us.

(BEGIN VIDEOTAPE) FREDERIK PLEITGEN, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice over): A troubling sight in a Russian court. WNBA Star Brittney Griner in a cage, testifying at her trial for allegedly trying to smuggle drugs into Russia. Tonight, the Biden administration saying it is urgently acting and is offering Moscow a deal to get both Brittney Griner and former Marine Paul Whelan out of Russian custody.

Secretary of State Antony Blinken saying he'll speak to Russia's foreign minister for the first time since Russia invaded Ukraine in February.

ANTONY BLINKEN, SECRETARY OF STATE: I plan to raise an issue that is a top priority for us, the release of Americans Paul Whelan and Brittney Griner who have been wrongfully detained and must be allowed to come home. We put a substantial proposal on the table weeks ago to facilitate their release.

PLEITGEN: Sources briefed on the matter told CNN that in return for Griner and Whelan was detained in Moscow in 2018 and sentenced to 16 years for alleged espionage, the Biden administration is offering to release Russian arms dealer Viktor Bout, who is currently serving a 25-year sentence in the U.S. for conspiring to kill Americans and who the Kremlin has in the past has demanded be released.

When asked by CNN's Kylie Atwood, the secretary refused to go into details but confirmed President Biden personally signed off on the offer.

BLINKEN: He signs off on any proposal that we make, and certainly when it comes to Americans who are being arbitrarily detained abroad, including in this specific case.

PLEITGEN: The U.S. considers both Paul Whelan and Brittney Griner to be wrongfully detained by Russia. Brittney Griner took the stand for the first time in her trial outside Moscow on Wednesday saying she accidentally packed cartridges containing cannabis oil into her luggage as she traveled to Russia. She also said her rights were never read to her when she was questioned at a Moscow airport, and she was told to sign documents that she did not understand.

BRITTNEY GRINER, WNBA STAR: There were documents that I had to sign. I can only assume that they were about the search and the cartridges. We had to use my phone for -- and Google translate for him to be able to tell me a little bit.

PLEITGEN: Russian courts have an extremely high conviction rate, but the WNBA star's lawyer criticized the way authorities treated her case.

ALEXANDER BOYKOV, LAWYER FOR BRITTNEY GRINER: I'll just say that the detention, the search, the arrest, they were imperfect.

PLEITGEN: At the end of another trial day, Brittney Griner was led out the way she came in, in handcuffs, as she and her supporters hope the Biden administration could secure a release and end the ordeal that's been going on for over five months. (END VIDEOTAPE)

PLEITGEN (on camera): And, Wolf, tonight after this news broke, we actually did hear once again from Brittney Griner's legal team there in Russia. They say they have not been part of any sort of discussions about a possible swap. They actually believe that possibly there would need to be a verdict in the court before a swap could legally, at least from Russia, take place however they say in any case, they hope that Brittney Griner gets home and gets home very soon.

[18:30:02]

Wolf?

BLITZER: Yes, we all hope that. Fred Pleitgen, thanks very much for that report.

Let's get some more on all of this. Joining us now, Democratic Congressman Colin Allred of Texas, who has been helping lead the call for Brittney Griner's release.

What's your response, Congressman, to our exclusive reporting that the Biden administration is now offering to exchange Russian arms trafficker Viktor Bout for Brittney Griner and Paul Whelan?

REP. COLIN ALLRED (D-TX): Well, Wolf, I'll just say that I have been meeting with the negotiating team. And what we have been trying to do in those meetings is support them in whatever they have to do to bring Brittney and Paul Whelan home. And so it seems like that's what they're trying to do.

I can't go into the specifics of the offer, but certainly what we have seen in the past is that the Russians will float names in their own press. We have seen this being one of the names that they have floated. And, you know, we're trying to support the administration in their efforts to bring Brittney home and understanding that this is not fair, the crimes are nowhere near -- or the alleged crimes, I should say, are nowhere near equivalent. But whatever we can do to bring them home, I think we have to.

BLITZER: And as you pointed out in the past, Congressman, it's not enough that the U.S. is willing to negotiate a deal requires Russian cooperation. Should these conversations -- do you believe, should these conversations have remained private until a deal is actually finalized?

ALLRED: Well, there is some concern there, because in the past when negotiations have become public, they have pulled away or changed the conditions. And so there are some concerns that I have there. But I'm hoping that if the secretary of state is openly talking about a package that we have offered, that they're doing that with the knowledge that they have a plan going forward for how that's going to be accepted or at least how the negotiations will play out from there.

I trust Secretary Blinken. I trust President Biden to have done this certainly, obviously in good faith but also knowing the impact it could have.

BLITZER: Have you actually spoken with Griner's family about this proposed prisoner swap, Congressman?

ALLRED: Not yet, but they're certainly aware and have been aware now for months that this was likely going to be, Wolf, how this was going to end. We all know that this is a sham trial that she's going through. As I'm sure you have covered, about 99 percent of folks who reach this point are convicted in Russia. So, this is not really a trial. This is an extended sentencing phase. And so we have always known that she would likely be convicted, likely sentenced, and then there would have to be some kind of negotiated deal, whether that's a swap or something else.

BLITZER: Griner, as you know, testified today that she was made to sign these documents she clearly didn't understand and reiterated that she had absolutely no intention of smuggling drugs into Russia. How important is it to hear from her directly after all this time?

ALLRED: Yes. I think it's incredibly important, and she's also had some very good character witnesses from her time playing there who have spoken up for her and also about the use that she uses for pain relief for cannabis. And so I think she has put forward what we would consider in the United States system the best foot forward.

But that's not really what matters in Russia and that's also not really what matters in this case because she was wrongfully detained in the first place. The only reason we're having this conversation is because they're trying to use her for leverage against the United States, and, clearly, we're having to do whatever it takes to get her home and I'm hoping that this package will be accepted by the Russians.

BLITZER: I hope so too. Congressman Colin Allred, thanks so much for joining us and thanks for all you're doing. We appreciate it very, very much.

ALLRED: Thanks, Wolf.

BLITZER: Just ahead, an exclusive interview with the principal of Robb Elementary School, the site of the horrific Uvalde massacre that killed 19 children and 2 teachers.

(COMMERCIAL BREAK)

[18:35:00]

BLITZER: Another CNN exclusive tonight. The principal of the Uvalde, Texas, elementary school where 19 children and 2 teachers were shot and killed is defending her actions after being put on administrative leave without pay. She spoke exclusively with our Rosa Flores, who is joining us now live from San Antonio.

Rosa, the principal of Robb Elementary sat down with you just a little while ago. What did she say? ROSA FLORES, CNN CORRESPONDENT: You know, Wolf, she says that she stands by her actions that day. She says that there was no such thing as a culture of noncompliance, and that she followed her training on that ill-fated day.

Let me take you through what she told me. She says that on May 24th, she learned about a gunman on school campus when a coach called over the radio, and she said that she immediately grabbed her cell phone to initiate the lockdown at Robb Elementary School. She said they have an official software application that they're supposed to use that everybody is trained on, and that all of the teachers have it. And she says when she tried doing that, there was some sort of lag.

So, she got closer to the window where she was hoping to get better Wi-Fi, better internet signal to send that message. She says that it took about 30 seconds for that to happen but then she says she called Police Chief Pete Arredondo right after and that as soon as he picked up the call, she didn't even say a word, that he replied, lock it down, lock it down, Mandy. She says that that told her that that message had indeed been sent and that the lockdown had been initiated.

Now, the Texas house investigative report criticizes the Wi-Fi connection at the school, says that's one of the things that went wrong on that day, that could have delayed the response, and it also criticizes the principal for not going on the intercom and making sure that the campus knew that it needed to go under lockdown.

[18:40:10]

I asked the principal about that, Wolf, and she said that it's her training that told her not to go over the intercom. She says that according to the active shooter training that she received, she's not supposed to go through the intercom because that could cause panic for the students and also that could alert the gunman.

And then there's the issue about the locks, about the locks to room 111. She stands by the fact that that lock actually worked. Take a listen.

(BEGIN VIDEO CLIP)

MANDY GUTIERREZ, PRINCIPAL, ROBB ELEMENTARY SCHOOL: The building is old. I myself was a teacher in that same building. So, I know that upon locking doors, we may have to pull on the door to secure it. But the lock itself, it works. If it had not, it would have been reported, a maintenance order would have been completed.

FLORES: So was the door to 111 then sometimes propped open so that instruction wasn't interrupted in room 111?

GUTIERREZ: No, ma'am. Doors were always closed.

FLORES: So, somehow, the report says that it was likely unlocked. So, somehow, it could have been unlocked on that day.

GUTIERREZ: It's possible. (END VIDEO CLIP)

FLORES: Now, Wolf, I asked, okay, so what went wrong then, because you saw the video, we all saw the video where the gunman walks into the school building and then goes into a classroom, she says that she just doesn't know. Wolf?

BLITZER: Rosa, I understand you also asked Principal Gutierrez if she is partly to blame for what happened that day. What did she say?

FLORES: You know, according to the Texas House investigative report, there was a culture of noncompliance, so I asked her about that. And she said absolutely not. And then I asked her, you realize that some of the families of the victims do lay some blame on you, and they are actually asking for your removal. And here's what she said.

(BEGIN VIDEO CLIP)

GUTIERREZ: I believe that everybody is at a different level in their grieving process. I believe they're entitled to their opinion. I feel that I followed the training that I was provided with to the best of my abilities and I will second-guess myself for the rest of my life. But, again, there are things that could change that are not in my circle of control.

FLORES: Do you feel you share some responsibility?

GUTIERREZ: I believe that there is always room for improvement. I believe that I did my job to the best of my abilities. I believe that, as the campus principal, if I did the job to the best of my abilities, then I would hope that nobody says that I am fully responsible for what occurred that day.

(END VIDEO CLIP)

FLORES: And, Wolf, she says that she hopes to keep her job, so I asked her if she feels that the parents of the victims, the families of the victims, will be able to trust her so that she can be principal again. And she says she hopes that that day comes when they can, in fact, trust her.

It's important to note we reached out to the Texas House investigative committee about this interview and her allegations, and the committee said that they based their report on various interviews from both the school district and also the police. We also reached out to the school district, and they did not have a response, Wolf, other than to say that they have been bombarded with requests and could not respond to our questions at this time. Wolf.

BLITZER: All right. Rosa Flores reporting for us, excellent work, thank you very much.

And we're going to see much more of Rosa's interview with the Robb Elementary School Principal later tonight on AC360, 8:00 P.M. Eastern.

Coming up, a dramatic change of heart by Senator Joe Manchin, and it could be a major boost for Democrats. The West Virginia moderate now says he has agreed to a major spending bill on health care, energy and more.

We'll be right back.

(COMMERCIAL BREAK)

[18:48:59]

BLITZER: Democratic Senator Joe Manchin of West Virginia says he has reached a deal with Senate Majority Leader Chuck Schumer to support some key items in the party's agenda, including a major energy and health care bill.

Our congressional correspondent, Jessica Dean, is up on Capitol Hill.

Jessica, this is potentially a big boost for Democrats. What are you picking up there?

JESSICA DEAN, CNN CONGRESSIONAL CORRESPONDENT: It certainly is, Wolf, but just as this news was breaking, the senators were going to the floor for a vote. We were talking to a lot of Senate Democrats who didn't have many details. They were learning a lot about this as we were learning about it as well. I tried to speak with Bernie Sanders who of course chairs the Budget Committee and also has been a proponent of a much larger deal, and he said no, not right now. I don't want to talk about it as this moment.

We know that it does include, according to Schumer and Manchin, that it does include Medicare being able to negotiate drug prices. It includes a lot of climate provisions that we thought Manchin had kind of scoffed at, but now has embraced, and some tax proposals as well.

[18:50:00]

Interestingly, a corporate minimum tax as well. So a bit meatier than we thought we would get from Schumer what we don't know and what the what we don't know and what the potential roadblocks could be is, remember, for this Democrat-only legislation, they're going to need all 50 Senate Democrats to get it through the Senate, and there's a question mark, do they have all 50 senators? That we do know that they're supposed to meet tomorrow morning as a caucus with Majority Leader Schumer.

Now, to the other side to house Democrats, it will ultimately have to go over there, as well. Will Leader Pelosi, Speaker Pelosi have enough votes over there? We know that these Northeast Democrats, Wolf, have been big on state and local tax deduction. There are big question marks around this. But potentially a very big boost for Democrat it is they can get this done, Wolf.

BLITZER: Key word, potentially. Jessica Dean, thank you very much.

We're also following a controversy over a potential trip to Taiwan by the House Speaker Nancy Pelosi. We know the U.S. defense secretary has briefed her on security concerns, but tonight, Pelosi says she won't talk about it publicly.

Let's go to our Pentagon correspondent Oren Liebermann.

Oren, what is the defense secretary saying about this possible trip?

OREN LIEBERMANN, CNN PENTAGON CORRESPONDENT: Well, it seems just like Speaker of the House Nancy Pelosi, Defense Secretary Lloyd Austin is also choosing his words very carefully. He acknowledged the conversation with Pelosi but wouldn't give any details. He did say he's concerned about what might happen, focusing on the aggressiveness and recent actions the U.S. has seen coming from China. That includes interceptions of U.S. aircraft and ships and those of allies.

And it's sort of those actions that the U.S. is watching very carefully in this case. This as national security officials have quietly tried behind the scenes to convince Pelosi now perhaps isn't the best time for a trip like this. And, of course, this potential trip by Pelosi to Taiwan and other areas, other countries in the region, hangs over the expected call tomorrow between President Biden and Chairman Xi. So this is almost certain to come up. Defense officials have prepared layers of force protection, as it would for any high level visit to Taiwan, including perhaps potential aircraft and ships around such a visit to make sure it's secure.

One of the big concerns here is not the potential for any sort of shooting. That possibility, multiple officials tell us, is quite remote. It's what would happen if China carries out more aggressive interactions or intercepts of U.S. or allied aircraft or pushes further into Taiwan's air defense identification zone or crucially if there is some sort of miscalculation here.

Wolf, as all of this happen, Taiwan, carried out its own simulated military drill, warding off an attempted take over of the strategic port. Wolf, I don't need to tell you who that was aimed at.

BLITZER: CNN's Oren Liebermann at the Pentagon, thank you very much.

We'll have more news just ahead. President Biden is free from COVID isolation and he's speaking out about his experience fighting the virus.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

[18:57:22]

BLITZER: President Biden is out of isolation tonight and says she's feeling great after testing negative now for COVID-19 following what was described as a mild case. He says his experience should serve as a reminder to Americans.

Listen.

(BEGIN VIDEO CLIP) JOE BIDEN, PRESIDENT OF THE UNITED STATES: But the reality is that BA.5 means many of us are still going to get COVID even if we take precautions. That doesn't mean we're doing anything wrong. I got through it with no fear, a very mild discomfort because of these essential, life-saving tools.

And guess what? I want to remind everybody, they are free. They are convenient. And they are safe. And they work.

(END VIDEO CLIP)

BLITZER: Let's get some more now with the co-director of the Texas Children's Hospital Center for vaccine development, and the dean at Baylor College of Medicine.

Dr. Hotez, thanks for joining us.

Is the president's experience an accurate representation of what testing positive for COVID now means?

DR. PETER HOTEZ, DEAN, NATIONAL SCHOOL OF TROPICAL MEDICINE AT BAYLOR COLLEGE OF MEDICINE: Yeah, absolutely. You know, the Centers for Disease Control has come out with hard data showing if you have gotten two boosts, even if you're over the age of 50, you do really well in terms of you're not likely to be hospitalized and very few deaths. So, that's the game changer, the fact that he got vaccinated and boosted twice and taking Paxlovid.

So I have a lot of optimism that -- I had a lot of optimism from the beginning, the trajectory of his illness was not severe, the fact that he was boosted twice, on Paxlovid, he maxed out all of the interventions. That's the message to the American people. You need to be mindful of your vaccination status, get boosted if you're not, and get double boosted if you're eligible.

How he does over the next few days, let's see. I hope he continues to do well. A number of us have had rebound COVID five days after stopping Paxlovid. That's not a reason to not take it. It's still very important.

But there is that possibility he could have rebound COVID, but I'm hoping he does extremely well.

BLITZER: Why is it a small possibility?

HOTEZ: Well, you know, the original clinical trials, rebound COVID occurs 1 percent to 2 percent of the time. But with these omicron sub- variants, there's so much more virus, what's happening is much higher frequency.

Exactly how much is up for debates. Some say 20 percent, some say more. It happened to me. I had rebound COVID after stopping Paxlovid. Tony Fauci did, as well.

So we'll see how he does. I'm still pretty optimistic. If so, he may just need to take a second course of COVID -- Paxlovid. BLITZER: Let's hope he does all right. He doesn't get it.

All right. Thanks very much, Dr. Peter Hotez, for joining us.

And to our viewers, thank you very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM.

"ERIN BURNETT OUTFRONT" starts right now.