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World Bracing for Trump's Sweeping New Tariffs; Judge Dismisses Mayor Eric Adams (D-New York City, NY) Corruption Case; Mexican President on Tariffs, We Don't Believe in an eye-for-an-Eye. Aired 10- 10:30a ET

Aired April 02, 2025 - 10:00   ET

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

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PAMELA BROWN, CNN ANCHOR: And happening now, what the White House is calling Liberation Day is here, but there's still a lot of uncertainty. In just hours, President Trump expected to announce sweeping new tariffs. What, how much, and how it could affect your wallet, we'll find out,

WOLF BLITZER, CNN ANCHOR: And there's more breaking news right now, expansion into Gaza, new operations from Israel after a strike on a U.N. facility there kills 19 people. New CNN reporting just coming in right now.

Welcome to our viewers here in the United States and around the world. I'm Wolf Blitzer. You're in The Situation Room.

And we begin with an announcement that could fundamentally reshape the U.S. economy and its global partners and redefine what you pay for everyday expenses. We're just hours away from the president's biggest tariff announcement so far. And while the details of the new import taxes are still unclear, the White House has floated the possibility of a 20 percent universal tariff. Chief economists tell CNN that could spark a, quote, serious recession here in the United States.

In The Situation Room this morning, we have economic and political experts to analyze the outcomes and a team of CNN reporters dispatched across the U.S. and indeed around the world.

Let's go live right now to CNN, White House Reporter Alayna Treene. Alayna, the thing about today's announcement in Trump's history with tariffs, in general, is that what we don't really know what to expect right now? What's the latest?

ALAYNA TREENE, CNN WHITE HOUSE REPORTER: Oh, yes, Wolf. The details are still very much unclear at, Wolf, and part of that is because yesterday the president spent much of his day, I'm told, huddled with top trade advisers getting calls from friends and allies and really trying to perfect, as the White House has referred to it, this tariff announcement.

Now, what we do know is that it's going to be at 4:00 P.M. today in the Rose Garden, his first Rose Garden event of his second term. And I'm told that it will also include the pomp and circumstance that he wants for this kind of dramatic announcement.

But part of the thing that's interesting about that, Wolf, is the timing of this. Originally, I was told it was slated to kick off at 3:00 P.M., then they moved the time to 4:00 P.M. Notable, I say, because that is after markets close.

Now, you mentioned some of the things that we've heard that have been floated. I think the key question really is the president and this administration going to impose tariffs differently for different countries, and the true sense of the reciprocal meaning of that word, or will it be, as you mentioned, across the board tariffs in all different countries as high as we're hearing 20 percent? That is still unclear, I'm told. And I do think things could change potentially before this 4:00 P.M. announcement.

Now, one key thing that isn't clear as well is what will the impact be on consumers, particularly, when will we see those higher prices? Will we see higher prices because of these tariffs? Another thing as well is, are there going to be any sort of exemptions for any specific goods or countries? The White House has said that these tariffs are going to be effective immediately.

However, we've also heard that the president is open to renegotiating some of these down the line. So, even though we are going to hear this announcement today, things could potentially change in a couple weeks from now. Wolf?

BLITZER: All right. Alayna Treene, treat at the White House for, thank you very much. Pamela?

BROWN: All right, Wolf. I'm joined now by CNN Global Economic Analyst Rana Foroohar. She's also a columnist for the Financial Times.

So, Rana, I want to begin with your latest op-ed on this, and you write that there are only three numbers that matter to Trump. The average U.S. tariff rate on other countries is 3 percent. Europe's is 5 percent, and China's is 10 percent. To him and to many Americans, those figures seem fundamentally unfair. So, why do so many economists think he can't move those averages closer together without harming the economy?

RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: You know, it's a great question, Pamela. We have not had an experiment really in a half a century in any kind of major tariff situation. Since the 80s, trade barriers have been falling. There are a lot of good things that come with that. Prices get cheaper, but, as you know, Trump has said, and as President Biden said before him, there's a trade off.

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You know, you get a lot of outsourcing of critical industries. You get a sense that consumption and consumer prices are everything, whereas income and jobs are less important. He's trying to rebalance that. It is a big experiment. I think it's not going to probably go as smoothly as the experiment in 2018-2019 did when there were tariffs on China, and it really didn't impact inflation too much. We're talking potentially about across the board tariffs. We're talking about retaliation from lots of countries around the world. So, this is going to be a much. much messier experience.

BROWN: And how long do you think this could all take until we really understand what we're dealing with here and how it's going to impact everyone's wallets?

FOROOHAR: So, I would say that there are two or three things in effect. One is the power of the U.S. consumer market. We are the biggest, richest market in the world. A lot of countries need to sell into the U.S. more than the U.S. needs to sell abroad. So, that's a bargaining chip for Trump. And it will be interesting to see how countries and companies respond.

But there's also the politics of this. And I know particularly a lot of European countries, Canada leaders have said, we're not okay with the way in which these negotiations are taking place, this sort of unilateral approach that Trump is taking, and also the on again, off again. And they may just say, you know what, we are not going to worry as much economically. We are simply going to throw down the gauntlet as it's being thrown to us. So, that's another point.

And then the final point is how much price increases consumers can take, companies can take, who's going to pay for them? Companies may reduce their margins. They certainly have room to do that. Consumers may pay a little more. How much more? We don't know.

BROWN: So, you know, I want to talk about this dollar for dollar argument we've heard. And, again, there's a lot of uncertainty. We don't know what the rollout's going to be. But White House Press Secretary Karoline Leavitt held up this chart this week showing a 245 percent Canada that Canada has on the books for American cheese. So what does this mean? Trump wants the U.S. to impose 245 percent on Canadian cheese? Is that argument flawed? What do you think?

FOROOHAR: I love that you picked cheese.

BROWN: I love cheese personally also, so, you know,

FOROOHAR: I love cheese too, and I also love French champagne, but which, you know, is going to get a lot more expensive. Those sorts of things are more political and iconic. Yes, of course, they're going to have an impact. But guess what? You can get cheese from Oregon too, you know? So, that won't be as much of an effect as say a tariff that Canada might put on U.S. imports if Canadian lumber is hit, you know? Canadian lumber is a big part of the U.S. home building industry. Those kinds of things that may get a little less pressed but are actually more important, that's what I'm going to be looking for.

BROWN: Very quickly, just for all of our viewers, as we're thinking about what we should buy now, what should we prioritize? FOROOHAR: Oh my, God. Well, cheese, champagne. No, I'm kidding, you know, Perishables. You know, you can see interestingly that there's already a little bit of inflationary effect from stockpiling, not just individuals, you know, maybe buying that car a little sooner 'cause you don't know how expensive it's going to be, but companies stockpiling inventories, this is one of the risks when you start to play the tariff game, is that people expect inflation, and so they purchase ahead and that creates inflation. It's a little bit of a chicken and egg cycle, another one of those variables the Trump administration is going to have to juggle carefully.

BROWN: All right. Rana Foroohar, thank you so much. Wolf?

BLITZER: All right, Pamela. Europe and other close allies, like Canada, have already vouched to retaliate against these latest tariffs. The premier of Ontario, for example, Doug Ford, has become one of Canada's most outspoken critics against President Trump's tit- for-tat trade war.

The premier of Ontario is joining us right now. Premier, thank you so much for joining us.

This new plan is expected to be the most aggressive move yet by a tariff-consumed American president. What is the mood there in Ontario and indeed the rest of Canada as we await this announcement later today?

DOUG FORD, ONTARIO PREMIER: Well, Wolf, thanks so much for having me on and I start every interview saying how Canadians love Americans. I love Americans, we love the U.S. And what this is going to do is going to hurt American families. And the folks you had on just previous is 100 percent banged on, the lumber that homes are built, majority of it is coming from Canada. It's going to increase the cost of a house, the autos as well. We ship as many autos as we buy, but the cost of a pickup truck or an automobile is going to go up. And then the pharmaceuticals too, that he's going to go after are going to hurt seniors on fixed incomes that get a lower cost on pharmaceuticals here in Canada.

So, these tariffs is nothing but attacks on Americans.

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And he, President Trump, calls it liberation day, I call it termination day, because a lot of people are going to be terminated from their jobs.

BLITZER: So, explain a little bit more why you call it termination day.

FORD: Well, we're the number one customer. We buy more goods off the U.S. than any country in the world, more than Japan, the U.K. and France combined. And if you go after Canada, we have no choice but retaliate. And I apologize to the American people. We shouldn't be doing this. And they were talking about cheese. Well, on the dairy products on the last deal that President Trump made, the U.S. hasn't even hit their quota. So, there's never been a tariff until after their quota, but they've never hit that quota. But let's sit down and negotiate a trade deal.

Again, President Trump ran on, you know, reducing inflation, creating more jobs. It's worked. It's the total opposite. Consumer confidence is down, investment is stalled, inflation is happening, the markets are tumbling and they're going to tumble today, and that those are people's pension funds that invested into the markets. So, this is not going to be good for the American people.

BLITZER: Premier, is Canada prepared for these tariffs? How will your country retaliate?

FORD: Well, right now, Wolf, there's 40 million people at a fever pitch. They're engaged and they're ready to sacrifice. And I don't think my great friends, and I have tremendous amount of friends in the U.S., they're kind of going on their merry way until they get hit, and if they're going to get hit hard based on President Trump continuing the tariff. But he's doing it on all fronts around the world.

You might have justification around the world. I would say China is the enemy, not Canada, but we're your closest allies and closest friends. We have a great trading relationship. Let's go back to that, create the Am-Can fortress, American-Canadian fortress, and we can take on the world. We'd be unstoppable. We would be the wealthiest, safest, most prosperous two countries in the world.

BLITZER: As you know, Premier, President Trump has threatened to impose tariffs in the past. Then all of a sudden, he backtracks, changes deadlines. Canada's Foreign Minister Melanie Joly says your country is not interested in going through this, quote, psychodrama every 30 days, that's a direct quote, adding, there's too much unpredictability and chaos coming out of the White House right now. Just yesterday, the White House said the President is open to negotiating these tariffs. Listen and watch this.

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KAROLINE LEAVITT, WHITE HOUSE PRESS SECRETARY: The president is always up to take a phone call, always up for a good negotiation. But he is very much focused on fixing the wrongs of the past and showing that American workers have a fair share.

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BLITZER: Premier, do you think the president might back off these massive new tariffs and possibly implement something much smaller?

FORD: Well, I really hope so. I'd like to just go back to the original deal. We had a great deal. He said it was the greatest deal ever. I guess it's not the greatest deal ever now. But, you know, let's work together. Let's sit down, two greatest countries in the world. I understand there might be issues around the world, but not with your closest neighbor and closest ally.

So, we need to sit down and do everything we can to have certainty. No one likes uncertainty. People don't like it. Businesses don't like it. The market doesn't like it. And that's what we're facing right now, because every single day, something changes and it's hard to keep up.

BLITZER: Canada's new prime minister, Mark Carney, has declared that the old relationship between the United States and Canada is now over. So, what does this new relationship look like to you?

FORD: Well, I just feel that we have to settle this and have some stability in both economies. Once we have the stability, we sit down and renegotiate the USCA deal or the USMCA deal and it will give people confidence and people will start investing into their companies and growing the market.

As I always say, you know, with the auto sector, you can't unscramble an egg that's been around since 1965. You have to make the omelet larger. And that's what we need to do to protect ourselves against countries that don't see eye-to-eye with us.

BLITZER: Yes. You say you love Americans and you have a lot of friends here in the United States. We love Canadians. We have a lot of friends in Canada as well. This is an unbelievable situation that has actually developed.

Premier Doug Ford of Ontario, thank you so much. Let's hope for the best.

FORD: Well, thank you, Wolf. God bless America. God bless Canada. We'll get through this together. Thank you.

BLITZER: Well said. Pamela?

BROWN: Great interview. We have two stories breaking this hour, a very busy Wednesday. First, Israel says it's expanding military operations in Gaza, and this time Israel plans to seize and control large areas in the enclave. Details on this breaking news just ahead.

BLITZER: And we've just learned that a federal judge has dismissed the entire corruption of case against the New York City mayor.

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Stay with us. You're in The Situation Room.

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BROWN: And breaking news, we are learning that a judge has dismissed New York City Mayor Eric Adams' criminal corruption case, and has ordered the charges that cannot be brought again.

So, let's go live now to CNN Correspondent Kara Scannell in New York. Kara, walk us through this decision. What happened?

KARA SCANNELL, CNN CORRESPONDENT: Yes, Pam, so the judge, Dale Ho, has dismissed the case permanently, saying it cannot be brought again. That is not what the Department of Justice wanted. They wanted this case dismissed without prejudice, meaning that they could revive it in the future. And what the judge does in the 78 opinion is really tear apart the Department of Justice's his reasonings for doing it that way. I mean, he says that his -- the judge says his hands are tied. There's very little he can do. He can't force a prosecution to continue.

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But he also says that the Justice Department's rationale for why the case should be dismissed, that there was prosecutorial misconduct, essentially, that saying the case was politically motivated, saying that was interfering with the mayor's ability to enforce Trump's immigration agenda. The judge shoots that down. He says that there is no evidence, zero, that they had any improper motives. He has said that everything here smacks of a bargain dismissal of the indictment in exchange for immigration policy concessions. This suggestion, he says, is fundamentally incompatible with the basic promise of equal justice under the law.

And while the judge says that there's little that he can do other than dismissing this case with prejudice, he says bringing the rationale, the Department of Justice's reasonings to the forefront so the public knows is something that he says is in the public interest and that they would potentially influence their future decisions on this through Democratic channels. Pam?

BROWN: Very interesting. Kara Scannell, thank you.

BLITZER: That's a major development indeed.

Up next we're only hours away from President Trump's global tariffs announcement and all of America's allies, can do right now is wait and watch and see what he actually says, and that includes one of our biggest trading partners in Mexico. How might it respond? We'll talk to a former Mexican official about that and more when we come back.

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BROWN: President Trump's liberation day announcement is just hours away. That is what he is calling it, liberation day. A lot of uncertainty, though, and we're waiting to see how key trading partners will respond, and that includes Mexico and President Claudia Sheinbaum, who has yet to announce any retaliatory measures.

For more on this, we're joined now by Julian Ventura, the former Mexican deputy secretary of Foreign Affairs. He also served as Mexico's ambassador to China and the U.K. Hi, Ambassador.

So, President Sheinbaum has largely adopted this weight-and-see approach to this trade war. Is this a winning strategy?

JULIAN VENTURA, FORMER MEXICAN AMBASSADOR TO U.S. AND CHINA: Well, I think it's a smart strategy. President Shaba must played smart with a difficult hand. She's bet on dialogue, and as you mentioned, holding off on targeted countermeasures, which are ready until the full picture is known. She's built a solid coalition of private sector stakeholders and developed a plan to increase domestic content and products manufactured in Mexico. But dialogue is ongoing.

As we speak, Mexico's trade secretary is in Washington for the sixth or seventh week in a row to talk to Commerce Secretary Lutnik and the U.S. trade representative to try to come to an understanding, which at least preserves, you know, tariff free trade for USMCA compliant goods, and establishes a roadmap to stabilize that relationship.

As you mentioned, uncertainty and shifting goals, our kryptonite for markets, investors and consumers in the United States, but also in Mexico. And this relationship is huge.

BROWN: Yes. How do you think Americans will be impacted by this in terms of its relationship with Mexico and what could happen as a result of these tariffs?

VENTURA: Well, Mexico is the U.S.'s top trading partner. We're one of your biggest customers. The top customer of American goods for many states all the way up from Oregon and Colorado, down to Arizona, Texas, and California. A lot of jobs depend on North American and U.S. Mexico trade, 14 million jobs in the region as a whole.

We know that crypto, that that tariffs have an impact on consumer state of mind on, on markets, on investors. So, there's definitely going to be a hit if and depending on the scope of the tariffs that are announced in by President Trump this afternoon. There's a lot of noise going around as to what the scope of those tariffs will be. But, ultimately, the buck stops at President Trump's desk and we'll find that out this afternoon.

BROWN: And we sure will. The White House right now, stay numb on it.

I want to play some of what President Sceinbaum said about all of this yesterday.

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CLAUDIA SHEINBAUM, MEXICAN PRESIDENT: We do not believe in an eye- for-an eye, a tooth-for a-tooth, because that always leads to a bad situation. Of course, measures are taken because measures are taken on the other side, but the dialogue must continue. It's not about tit- for-tat, but about what is best for Mexico and how to face the situation.

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BROWN: So, does that give you any indication of what her response could look like?

VENTURA: Yes, she's absolutely right. How one retaliates is difficult to calibrate with what's coming out of Washington because there's always a risk of escalation. An eye-for-an-eye approach is not the most effective in an asymmetrical relationship like that of Mexico with the United States.

So, a measured but firm response is always advisable when so many jobs and prosperity are on the line. We'll see what the specifics are this afternoon, but I would expect President Sheinbaum to continue along those lines, if those tariffs are definite and there's no path toward drawing them, Dan.

I would expect to see some targeted tariff responses, tariff and non tariff responses that try to minimize the impact on the Mexican economy. But, again, this all depends on what happens in the next few hours. In Washington, no one really knows exactly what the president will decide.

BROWN: All right. Julian Ventura, thank you so much. Wolf?

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Pamela, as we said the president, President Trump, will be in the White House Rose Garden just a few hours from now to announce his global trade plan.