What’s Behind the Crime Drop in the US?

Summary

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Amanpour (CNN Podcasts)

Episode: What’s Behind the Crime Drop in the US?
Date: August 10, 2026
Host: Paula Newton (in for Christiane Amanpour)

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Episode Overview

This episode of Amanpour explores critical issues facing the United States in the second half of 2026: the protracted conflict with Iran and its economic impact, the Trump administration’s policies on defense and the economy, and, centrally, the surprising drop in violent crime rates across large American cities. Democratic Congressman Steve Cohen joins to discuss both international and domestic policy—especially the historic decrease in homicide and other violent crimes. Later, Wall Street Journal reporter Hannah Critchfield details ICE's new digital surveillance efforts, and economist Brad Setser analyzes the real health of the U.S. economy under Trump.

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Key Discussion Points & Insights

1. The Iran War – Stalemate and Security Concerns

• Guest: Steve Cohen, Democratic Congressman, Judiciary and Intelligence Committee member
• The six-month war with Iran is dragging on, with stagnant frontlines and no reopening of the Strait of Hormuz ([02:49], [09:56]).
• U.S. munitions are dangerously low, raising questions about military readiness for simultaneous global threats ([04:58]).
• Concerns about political leadership and military appointments under the Trump administration are highlighted.
  • "We've got both of our hands tied behind our back because Hexif has no business being the secretary of defense." – Cohen ([05:28])
• Cohen expresses deep worry about possible election interference and a looming constitutional crisis in 2027 ([09:16]).

2. Declining Crime Rates – Why Is This Happening?

• Main Theme: National homicide rates and other violent crimes have dropped to their lowest levels since at least 1900 ([11:47]).
• The decline is widespread, with dramatic reductions (e.g., 26% drop in murders in Memphis in 2025) ([13:31]).
• Cohen and Newton both question the trustworthiness of the statistics and their sources:
  • “Mark Twain was known to say, there are liars. They're damn liars and they're statisticians.” – Cohen ([14:06])
• Neither credits federal policy; instead, factors include local policing and the ebbing of COVID's social disruptions, but Cohen admits:
  • “Nobody has a good answer.” ([12:37])
• Despite data, public sentiment on safety does not match the improved numbers ([14:06]).

3. Economic Pressures & Midterms Foresight

• Affordability emerges as the leading political issue over declining crime rates ([15:47]).
• Cohen underscores the daily financial struggles many constituents face:
  • “I just had a tooth extracted...$5,500 for an extraction and a bridge.” ([15:47])
• Discussion transitions to broader economic factors, setting up economist Brad Setser's segment.

4. Economic Reality Check: The "Boom" and Its Limits

• Guest: Brad Setser, Senior Fellow at the Council on Foreign Relations
• President Trump touts a "Golden Age," but Setser and Newton detail divides in economic experience ([18:52]–[19:22]).
• Most Americans remain squeezed by high prices and slow wage growth; AI investments drive select sectors but not the broader economy ([20:29], [21:59]).
• Fiscal deficits and high government spending are fueling inflation and keeping interest rates high ([24:43], [25:46]).
• Setser does not foresee an imminent financial crisis due to low household and banking leverage, but warns of "squeezed growth" and future risks as AI investments shift from cash to debt ([26:14], [28:44]).

5. ICE's Escalating Social Media Surveillance

• Guest: Hannah Critchfield, Wall Street Journal reporter
• ICE has dramatically ramped up surveillance of public social media posts, flagging criticism and alleged threats against agents ([39:13], [39:46]).
• Notable increase: $258 million spent in surveillance tech and contractors—a 57% year-over-year increase ([43:32]).
• ICE subpoenas target both activists and ordinary citizens; legal experts suggest the practices are often more about intimidation than prosecution ([47:38]).
• Platforms like Reddit and Meta push back on some requests but transparency is limited ([47:17]).
• Cases have resulted in convictions for actual threats, but the dragnet sweeps up a broader array of critical speech ([51:53]).

6. Aftermath in Lebanon: Human Cost of the Israel-Hezbollah Conflict

• Field Report: Nada Bashir in southern Lebanon ([33:07])
• Displaced families return to devastated homes; infrastructure and livelihoods destroyed.
• Some residents trust the Lebanese army for protection; others remain loyal to Hezbollah.

7. Reflection: Hiroshima Survivor Recounts Atomic Bombing

• Sokol Thurlow shares memories of surviving the Hiroshima bombing as a girl, bringing historical context and emotional resonance to the present ([54:14]).

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Notable Quotes & Timestamps

On the Iran War & Military Readiness

• “We've got both of our hands tied behind our back because Hexif has no business being the secretary of defense. He was a TV guy and he got hired...This guy just hires people based on how they look. And unfortunately, he doesn't take that same policy when it comes to himself."
  – Congressman Cohen ([05:28])

• “There's just pigeons are coming home to roost in America with a president who's not capable of being the president, United States.”
  – Cohen ([07:40])

On Crime Rates & Data Skepticism

• “Mark Twain was known to say, there are liars. They're damn liars and they're statisticians. And these reports are all coming from statisticians after their communities had gotten terrible ratings for high crime rates. So maybe they're just not reporting as well.”
  – Cohen ([14:06])

On Public Perception Versus Reality

• “Most of my constituents don't feel any safer, and I don't feel any safer.”
  – Cohen ([14:06])

On Affordability & Voter Priorities

• “I think affordability. I think people go to grocery store and they see the prices very, very high. I see them myself when I go to the store. It's absurd, the prices they have...Health care needs are unbelievably high. I just had a tooth extracted...$5,500 for an extraction and a bridge. $5,500.”
  – Cohen ([15:47])

On Economic Divides

• “There's a very strong divide between those parts of the economy that are benefiting from...AI...and the rest of the economy, which is not actually booming. And some people are clearly feeling squeezed with prices up more than their salaries are up.”
  – Brad Setser ([19:22])

On High Government Deficits’ Effects

• “You're heading back to a fiscal deficit of about 6% of GDP. That's very high for an economy that is not in real trouble...That's certainly putting pressure on longer term rates.”
  – Setser ([24:43])

On ICE Surveillance Expansion

• “We found that ISIS deployed this round the clock digital dragnet to scour the public Internet, from Facebook to Instagram to X, for speech that could endanger the agency’s mission...Both US citizens and activist groups...have been flagged.”
  – Hannah Critchfield ([39:13])

• “ICE has issued hundreds of subpoenas related to online speech to try and unmask anonymous posters.”
  – Critchfield ([39:46])

On Social Media Platforms’ Response to ICE

• “Reddit and Meta...also provided specific examples of times that their attorneys push back on behalf of users when they felt the subpoenas were overly broad or targeting First Amendment speech...But it’s unclear in broad terms how often this happens.”
  – Critchfield ([47:38])

On Hiroshima Bombing (Historical Reflection)

• “I saw the bluish white flash and I still have the sensation floating up in the air. And when I regained consciousness, I found myself in total darkness and total silence. And I tried to move my body, but I couldn't. So I knew I was facing death...”
  – Sokol Thurlow ([54:14])

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Timeline of Key Segments

| Timestamp | Segment/Topic | |------------|--------------------------------------------------------| | 01:04 | Paula Newton introduces upcoming topics | | 02:49 | Iran war update, political/economic fallout | | 04:31 | Rep. Steve Cohen discusses defense/military shortages | | 11:47 | U.S. crime rate drop—deep dive with Cohen | | 15:47 | Midterm issues: affordability and health care costs | | 18:39 | Brad Setser on the economy: growth vs reality | | 24:43 | U.S. fiscal policy, deficits, and interest rates | | 26:14 | Crisis risk assessment in U.S. financial system | | 33:07 | Nada Bashir field report: Lebanon postwar recovery | | 39:13 | Hannah Critchfield: ICE's digital surveillance | | 54:14 | Hiroshima survivor Sokol Thurlow shares her story |

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Summary & Takeaways

This episode offers a multifaceted look at America mid-2026:

• Crime drop: Violent crime statistics have hit historic lows, but both reality and perception are complicated by skepticism, reporting practices, and unchanged public fear.
• Iran war: Prolonged conflict strains military readiness and exposes deep political rifts.
• Economic undercurrents: Despite political rhetoric of a “boom,” the economy is uneven and fraught with affordability crises for many Americans.
• Civil liberties: ICE’s expanded surveillance of online speech underscores growing concerns over privacy and government overreach.
• Global context: International conflicts in Iran and Lebanon highlight ongoing instability and humanitarian costs.
• Historical reflection: Firsthand testimony from a Hiroshima survivor contextualizes current global risks within a continuum of violence and survival.

The recurring theme: What’s measured on paper—a crime drop, robust GDP, strong dollar—often collides with lived experience, skepticism toward institutions, and deep national and global uncertainty.

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Transcript

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[Paula Newton]

Hello everyone, and welcome to Amanpour. Here's what's coming up.

[Kevin Hassett]

A lot of them are very angry at Republicans. To be honest with you. They're angry at Republicans. I don't know.

[Paula Newton]

From the Iran war to affordability to a drop in violent crime rates. And could these issues sway US Voters in the upcoming midterms? I speak with Democratic Congressman Steve Cohen.

[Congressman Steve Cohen]

Then look at the overall economy. Then things are really, really booming.

[Paula Newton]

The Trump administration touts a roaring economy, but are the warning signs starting to light up? Former treasury official Brad Setzer joins us.

[Nada Bashir]

Plus, Israeli bullets, he tells us. Walls completely blown out. Bullet holes above where his grandchildren once slept.

[Paula Newton]

More than 800,000 displaced Lebanese people are returning home amid the Israel Hezbollah war. Correspondent Nada Bashir has a report.

[Hannah Critchfield]

Also ahead, ISIS deployed this round the clock digital dragnet to scour the public Internet, from Facebook to Instagram to X for speech that could endanger the agency's mission.

[Paula Newton]

How ICE is weaponizing social media, Wall Street Journal reporter Hannah Critchfield tells Hari Srinivasan. And a warm welcome to the program, everyone. I'm Paula Newton in New York, sitting in for Krishna Mompour. Patience is wearing thin amongst American voters as President Trump's costly war with Iran drags on.

[Hannah Critchfield]

Yes.

[Paula Newton]

Now into its sixth month with little progress towards a solution. Oil prices climb and climb. And amid the economic strain of the conflict, there's growing frustration towards the Republican Party as Democrats appear to lead in voter support three months ahead of the November midterm elections. That's according to a Reuters IPSOS poll. Now, as the parties campaign hard, of course, across a range of issues, Americans can perhaps breathe a sigh of relief when it comes to one key domestic crime. A new report by the Council on Criminal justice shows a notable drop across large cities in the first half of the year, with homicides reaching their lowest level since at least 1900. This trend, of course, isn't due to the success or failure of one particular policy, but likely the result of a range of factors translating legislation. It's much more complicated than we first believe. Steve Cohen is a Democratic congressman and a longtime lawmaker who sits on both the Judiciary and Intelligence House committees. He's going to try and help us break all of this down. And I hear you, see you that this is in fact much more complicated than we have at first blush. I want to go first to the fact that you do sit, though, first on the Intelligence Committee. What are you seeing? What are you hearing right now when it comes to any kind of a resolution in Iran? I think what is most concerning for so many Americans is when they really see that perhaps America has one arm tied behind its back when it comes to ordnance and munitions. What have you learned that you can share?

[Congressman Steve Cohen]

Well, there's not that much that I've learned that I can share. If I told you

[Hari Srinivasan]

they have to

[Paula Newton]

shoot you, that's not exactly reassuring. That's not exactly reassuring. But listen, CNN and other great publications, we already have our own reporting, Right. And they show that even senior US Military commanders are warning that the Pentagon's munitions are dangerously low.

[Congressman Steve Cohen]

Well, I think the common accepted perspective is that munitions are low and that we've used an abundance of materials in Iran and we don't have enough in America to cover what could be problems if we try to help Taiwan defend itself from communist China, if we try, like we should to help Ukraine and stopping the Russian attacks on the civilian population, it is a genocide in Ukraine. But these are war crimes that Russia's continuing to conduct and we're not helping Ukraine, which we should, with weapons. So, yeah, there's no question we don't have enough weapons. And there's no question that we've got problems. And we say we got a hand tied behind our back. We've got both of our hands tied behind our back because Hexif has no business being the secretary of defense. He was a TV guy and he got hired, just like Christine Om got hired and Paula whatever her name was from Florida got hired to be the second DA Attorney general. And that was after they wanted Matt Gaetz I mean, this guy just hires people based on how they look. And unfortunately, he doesn't take that same policy when it comes to himself, because if he'd have looked in the mirror, he wouldn't have run.

[Paula Newton]

So, Congressman, though, this remains a problem for Americans, including you, an elected official. Now, I want to point out that we have a lot of people that come on and, you know, illustrate the problem. But what is the solution here? Because America at war with Iran. I do want to say that Trump has privately complained that disclosures, the disclosures that you and I are discussing right now on those dwindling stockpiles make the US look weak in his opinion. And Trump wrote on Truth Social, the US has massive amounts of munitions, especially of certain types. Additionally, large amounts are being manufactured and shipped to the US as needed. Defense companies are building the largest number of plants and factories in our country's history. Is there anything in what the president says that is the solution here that, you know, reassures you that all is not lost?

[Congressman Steve Cohen]

Well, I don't think all is lost. I mean, we'll probably go into maximum speed in trying to ramp up the production of weapons, missiles, planes, et cetera that we need. And we'll catch up, but it'll be an additional expense and it'll just run up the deficit. And it's tremendous already in the trillions of dollars. And the country's in danger. There's just pigeons are coming home to roost in America with a president who's not capable of being the president, United States. I saw Beschloss post us up to today with Richard Nixon announcing his resignation as president. And they were showing early clips. And I looked at Nixon, I thought, you know, he was a crook in Watergate, and he had some nasty things to say about lots of people in America. But he knew policy and he knew national affairs and he knew foreign affairs. You can't say that about Trump.

[Paula Newton]

But he has been elected president. He will remain president till the end of his term. In 2028. This becomes very serious, right? As so many Americans say that once America goes to war, pretty much you got to be rooting for your team, Right? I mean, I guess I'm just a bit confused as your posture here. You're on the Intelligence Committee. You can't tell me what you hear. But when you do hear what you hear, what do you think the solution is? Now, how does America get out of this thing?

[Congressman Steve Cohen]

We have to be prepared. We have to have our defense stockpiles replenished, and we have to keep our good generals, which we're getting rid of many of our good generals. But that's unfortunate because of their, their attack on dei. And they fired a lot of women and a lot of African Americans who were the top leaders. And there was a man who was destined to be the head of the military Joint Chiefs of Staff, and they fired him for some reason and everybody loved him. So there's some crazy things going on in our government and they're not going to stop because Trump is, it doesn't. He doesn't do about faces.

[Paula Newton]

In terms of the Iran.

[Congressman Steve Cohen]

I'm concerned about the future.

[Paula Newton]

Go ahead.

[Congressman Steve Cohen]

I'm concerned about the future of the country. I think the next two years are very serious, not only internationally, which they are, but domestically. And I don't. And I'd be not be surprised if Trump tries to do something with the elections in November, with the throwing ice and federal agents at the polls to try to intimidate people and try to change the results and to claim on January 3, if the House is a Democrat, which I think it will be, that they're not going to have them seated and that our new U.S. attorney will Attorney General will do what Trump tells him to do and we'll have a real constitutional crisis on January 3rd of 2027.

[Paula Newton]

I do want to return to the issue at hand with the war. It's been almost six months since Iran started this war. Hormuz still isn't open. We're not exactly sure when it will be.

[Congressman Steve Cohen]

You say, since when did Iran start the war? I thought, well, this is the war we started.

[Paula Newton]

Pardon me, I might have misspoken. My point, though, is that the president continues to say that there was a reason that he started this war, and that's the fact to make sure that Iran does not have a nuclear weapon. So the strait still is not reopened. Do you think Iran has a strategic win here? And if it does, I'm going to repeat what I said to you before. You can't be hoping that's the case. Even if it is good for Democrats politically.

[Congressman Steve Cohen]

Oh, I'm not thinking of it in terms of Democrats. It's just the reality. And I do hope that we can extract ourselves without too much more. But we'll be lucky to get like a draw out of this right now. If we can get the Straits of Hormuz opened, it's going to be which they were open in the first place. It's like touchdown. We're not going to get the nuclear fission that they have. They probably moved it already. Deep underneath mountains. But they've moved it. I suspect they've got a worse leadership team than they had before the war started. We killed so many of the leaders. How can you expect a man whose father was murdered on day one to be a nice conciliatory guy? And I think he's nobody. I don't have any definite proof of any of this, but apparently he's disfigured and damaged greatly from that attack. He's not going to think well of Trump. The Iranians have always thought we were the Satan. And if you were Satan before you killed his father and disfigured him and killed a few other members of his family, you're even super Satan. Now we're going to have a problem with Iran the rest of the for a long time. The rest of my life. Probably the rest of your life, too.

[Paula Newton]

Definitely a sobering opinion you have there for Americans and anyone looking in on how this conflict is unfolding. I do want to pivot now, though, to the focus of another one of the committee assignments that you have, which is crime and federal government surveillance. Following the historic 30% increase in homicide, and that was from 2019 to 2020. The Council on Criminal justice last report estimated that in 2025, national homicide rate will likely be at its lowest level since 1900. Homicides, carjackings, residential burglaries, carjackings dropped by more than 50% compared to their peaks over the past nine years. From what you know of your work on committee, why do you think this is happening and do you believe it is something to celebrate?

[Congressman Steve Cohen]

Well, indeed, it's something to celebrate. We've got a large high crime rate in Washington, D.C. and in Memphis, Tennessee, the two cities I live in mostly. And it's unfortunate. And the crime rates still are too high. They've gone down not because of any federal task force, but because of local policing. And the fact that we've gotten beyond. There was a real rise during COVID times, and Covid peaks have come down greatly. Why they come down to the 1900 levels was kind of hard for me to fathom. I saw some report where somebody said that because of what the police have done with and ICE have done, the people distrust the police more and so there's less crime. That doesn't make much sense. If they distrust the police, you'll have less crime. But so I don't think anybody has a good answer. And I don't think the public is just all of a sudden becoming much more Mr. Rogers and trying to be good and make the neighborhood clean and nice.

[Paula Newton]

I am curious as to what you're seeing there in Memphis. In fact, police there say that in 2025, there was a 26% decrease in murders, 22% drop in aggravated assault, 31% decrease in robberies, carjackings, down by almost half. Those are the stats. But crime, still, I'm sure you'll agree with me, remains a political issue. What are your constituents telling you? Because sometimes they look at these stats and they would tend to say that they are safer. And yet perhaps your constituents are telling you they don't feel any safer.

[Congressman Steve Cohen]

Most of my constituents don't feel any safer, and I don't feel any safer. I know that the local police department has had some improvements in some of the operations, and crime rates were going down before the task force came here. But Mark Twain was known to say, there are liars. They're damn liars and they're statisticians. And these reports are all coming from statisticians after their communities had gotten terrible ratings for high crime rates. So maybe they're just not reporting as well.

[Paula Newton]

That is, again, a fairly controversial and sobering assessment that you have of the police department in Memphis itself, because that's where we're getting the data from.

[Congressman Steve Cohen]

Well, they get it from the crime commission as well as their own data. And you can classify crimes in different manners or different ways to classify what's a violent crime and what's a crime. Again, you know, there's classifications therein that they can. They can use, but this is all over the country. So it's not just. It wouldn't just be the Memphis Police Department, but every night when you see the news, somebody else is getting murdered. It's hard to believe. I mean, Trump came here and I think it was in May or April, and he said in a month, Memphis will have no crime whatsoever. He said the same thing about Washington, D.C. about six months ago. Just ridiculous.

[Paula Newton]

Congressman, we only have about a minute left. I do want to note that you are not running again for office, given there are some highlights there in terms of what's going on with affordability, what's going on with crime. I mean, what do you think will be the most salient point in the midterms going forward from where you sit, even though I stress you're not running again.

[Congressman Steve Cohen]

I think affordability. I think people go to grocery store and they see the prices very, very high. I see them myself when I go to the store. It's absurd, the prices they have. It used to be to see get a steak. And the price would be what it was, a pound. Now it's for the steak and it's maybe a 12 ounce portion. So you get confused sometimes with not putting on the price per pound. But it's everything more expensive. And people are having difficulty putting food on the table, taking care of their housing needs and their health care needs. Health care needs are unbelievably high. I just had a tooth extracted on last Wednesday and it was $5,500 for an extraction and a bridge. $5,500.

[Paula Newton]

Again, it is what Americans. Yeah, it is Americans without health or dental benefits put up with every day. Steve Cohen, we have to leave it there. Thanks so much. Appreciate it, Paula.

[Congressman Steve Cohen]

Thank you. Have a good one

[Paula Newton]

and stay with cnn. We'll be right back with more news after a quick break.

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[Hannah Critchfield]

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[Paula Newton]

So the Trump administration wants you to believe that the US Economy is in a very good place. But there are some worrying indicators that warrant a closer look. Now, the Fed still cautious, still refusing to cut interest rates as the US President demands. Then there's the rare intervention in the Japanese yen, a move aimed at preventing a sell off of US treasury bonds. Does that show real fragility in the US Bond market, typically a safe haven for investors? And why should this matter to you and I? Well, we want to bring in Brad Setzer. He was a senior advisor to the US Trade representative and has worked in the US Treasury. He's now a senior fellow at the Council on Foreign Relations. Good to see you. Thanks for being with us.

[Brad Setser]

Well, thanks for inviting me on.

[Paula Newton]

I want to set the table here first with Kevin Hassett saying things are really booming in his words. But I do want to play as well. President Trump, Listen,

[Kevin Hassett]

our country right now is doing better than it's ever done. You know, when I see polls on the economy, I should have 150%, not 100%, because we have the greatest. This is the golden age of America. What's being built now in this country has never, ever been built. And we're really, we are literally in the golden age of America.

[Paula Newton]

All right, how about it, Brad? What's your take on this economy under Donald Trump?

[Brad Setser]

Look, I think most Americans would actually disagree with President Trump's statements. People are concerned about higher prices. It's not a new concern. And, you know, there's a very strong divide between those parts of the economy that are benefiting from an enormous wave of investment into data centers and all the kit needed to build out the AI supposed revolution and the rest of the economy, which is not actually booming. And some people are clearly feeling squeezed with prices up more than their salaries are up.

[Paula Newton]

We do want to have a look at the data about all of this. Now, Donald Trump and his team have promised 5, 6% GDP growth. I mean, let's take a look at that last reading. The economy grew 2.1% in the first quarter and 1.5% in the second quarter. We're looking at some of the data now going back to 2021. I mean, where do you believe this growth is headed? And again, there is the question of how much AI is contributing to all of this.

[Brad Setser]

I mean, I think 2% is a reasonable growth rate for the U.S. economy. Obviously, there isn't as much immigration as there used to be. There's not as much labor for. So that's. That is a reasonable growth rate. It is not a boom. And I think it is pretty clear that a meaningful portion of that growth is coming from AI and AI related investments. Though it should be noted that a lot of the AI investment is being spent on imported semiconductors. So it's spilling over to the rest of the world. It's all not just benefiting the U.S. without that, I think we would probably be in a period of actually subpar growth,

[Paula Newton]

but growth nonetheless. I think many Americans are feeling that because they just don't feel that the economy is as robust as the data. As you said, given the data, even at 2% and change, I do want to get to Trump's two major policies though on tariffs and the Iran war. And this gets to the affordability crisis. If we look at inflation here, I mean, look, inflation was very high after the pandemic, we can see that. And yet it came down. But it is stubbor sticky. It is at 3 and 4%. And what is crucial here is the fact that real wages, what people are earning, is not keeping up with an inflation. How much of a problem do you believe this is going forward? And how do you expect the Federal Reserve, Kevin Warsh, the new Fed chair there, to deal with it?

[Brad Setser]

Well, I do think it is for most Americans it's a problem when prices are up faster than their wages. People want wages to grow faster than their prices. That's a reasonable expectation. And when there's one sector that is booming and there isn't a broad based boom, the economy doesn't feel great to a lot of people. It's a challenge for the new chair because sticky high inflation actually suggests a case for rate hikes. It'll depend on how the data evolves and that's at odds with what the President wants. And it's a little bit at odds with how many people feel. I mean, if you're trying to buy a home, you don't necessarily want rates to go up. But right now the aggregate data, decent growth, not spectacular growth above target prices, tends to point towards rate hikes.

[Paula Newton]

And yet he doesn't seem to be moving in that direction. And this leads us quite frankly to the bond market. I want to bring up the mortgage rates, which is a 30 year fixed rate. And I'll tell you why I always look at this because I believe this is really what is keeping the United States from even growing more. And perhaps you might disagree with me, but when we're looking at interest rates that are stubbornly. A 30 year fixed mortgage is stubbornly above 6% and nearing 7%. And it's been that way for a while. How do you read that in the bond market? Because I do want to get then to the Japanese intervention because it is all linked. But if we just look at what's going on with mortgage rates right now,

[Brad Setser]

look, mortgage rates are a lot higher than they were during the low for long period after the global financial crisis that is clearly making it hard for many people to afford homes. Monetary policy is currently somewhat restrictive. That's why mortgages are high. That's part of the reason why 10 year treasury rates are high. Not the only reason, but it is indeed how, unfortunately how Monet policy works. Monetary policy works through interest rates, it works through long term interest rates, it works through mortgages. And that higher level of mortgages is indeed slowing parts of the economy.

[Paula Newton]

When we get to where it's going to go next, though. And you mentioned monetary policy, right? That's what the markets do. That's what the Fed does. But what about fiscal policy? How much is that a component right now? We've had the big beautiful bill in the United States, you know, arguable in terms of what Americans are seeing from that. But spending in government, government still remains quite high, continues to add to both the deficit and the debt.

[Brad Setser]

Look, we're heading back to a fiscal deficit of about 6% of GDP. That's very high for an economy that is not in real trouble. It's very high for an economy that's kind of growing more or less at potential and is very high, frankly, for an economy when big parts of the economy, all the hyperscalers, all the people investing in data centers are investing a lot of money too. So you have the government, government borrowing a lot. You have now some of the investment in artificial intelligence and data centers financed by corporate borrowing. And that's certainly putting pressure on longer term rates. It's also adding demand to the economy and making it hard for the Fed to achieve the rate cuts that the President wants. So there's a tension between the President's fiscal policy, which pushes demand up, pushes, creates a little bit of inflationary pressure, keeps pressure on the Fed to keep rates higher, and his desire for lower interest rates, unquestionably.

[Paula Newton]

So, Brad, I do want to get to the very financial foundations though, that all of us are pinning our hopes on and anybody in the world. It is the US Economy really that everyone has to look at. So I put to you, we've already had this century a global financial crisis, a global pandemic. Now we've got this war in Iran which seems to have no end. Where do you put the risk of another financial crisis in the next few years?

[Brad Setser]

Modest, I would say.

[Paula Newton]

And why is that? Because I would argue that if something happens that there isn't the resiliency that we've had in global economies in years past. So why is the risk modest? And are you confident that central bankers around the world, that governments around the world could handle it?

[Brad Setser]

Look, I don't have as much confidence that we have the most efficient system of crisis response anymore. I think we've seen a lot of friction and we've seen the US introduce a lot of friction into its relationship with key allies, particularly in Europe. And those are the people who you need to cooperate in at in a crisis. I think the reasons why I don't see an immediate risk of a financial crisis are twofold. One, there isn't recent evidence of large fiscal deficits causing a financial crisis in the government in G10 countries. It can put a lot of pressure on the rest of the economy. You can be forced to raise rates to high levels and that can slow down the economy. You may find it difficult to manage parts of the government bond market, may be pressured to do things you might not otherwise want to. But a crisis crisis like we experienced in 2008, that tend to come from leverage in the banking system, leverage in things like the housing market. And right now there isn't that leverage in the banking system, in the financial system. As we mentioned, households aren't borrowing that much. That gives the system a bit more resilience and frankly we're lucky that the companies are doing most of the investing in AI, are incredibly profitable. So for now they're starting to borrow, but they're mostly financing it out of their own cash flow. Wait a couple of years, have a lot of the AI investments financed by debt. That's when I would start to worry. But as of right now, I don't think we're facing the risk of a financial crisis. I think we're facing the risk of kind of a squeez growth. Higher interest rates than we would like, higher oil prices, higher prices than we would like. That is a different problem.

[Paula Newton]

Again, though not unrelated to what will be the disruption. And I hear you on that. They're not highly levered. Although if you look at what Google's done recently and. Or Alphabet, I should say, and Oracle, perhaps, we may be turning a corner even on that financing.

[Brad Setser]

Yeah, wait two, three years and I will change my assessment. I mean, it is, is. It is still. It is still. You know, we are just at that inflection point when free cash flow no longer is funding the investments. That is an important inflection point.

[Paula Newton]

Understood. I want to get to something that you do a lot of work on and that's currencies. Treasury Secretary Bessant said about his Japan intervention. I want you to listen to what he said to CNBC earlier this month. Listen.

[Congressman Steve Cohen]

Given the trade flows, given the size of the economy, given their contribution to the global savings market, very important to have a stable yen that the Japanese government understands that. And we are proud to stand with them in implementing their policies and help them stabilize the region.

[Paula Newton]

So I'm going to note that in June you actually called for more coordinated action to raise the value of these key Asian currencies. Why do you agree with this intervention and do you think it was done well by the Treasury?

[Brad Setser]

I do agree that the yen was incredibly undervalued. So too the Korean won, although the yuan has rallied a bit since June. So to the Taiwan dollar, so to the Chinese yuan, really undervalued currencies in a region that now has the world's largest trade surplus. That's a little bit strange. And it was, in a sense, making it harder for the global economy to find a new equilibrium. When you have weaker currencies in the countries that are generating the world's biggest trade surplus. The currency market is saying, invest in manufacturing in Asia, don't invest in manufacturing in the US it's saying run bigger trade surpluses in Asia, don't reduce the US Trade deficit. So I do think there were a set of risk associated with extremely weak currencies across Asia, not just in Japan. Japan, the yen, at 160 actually got weaker than 160. That's a very, very weak yen. Now, there are reasons for the yen's weakness. Japan has very low interest rates. And I don't think this will work over time unless the bank of Japan starts raising rates. And it will have a chance to do so in September. But as a bridge to rate hikes, as a way of helping a friend, and I think it's actually useful for the Trump administration, which generally doesn't help friends, which has sometimes poked friends in the eye a little bit. It's like it's helpful for the Trump administration to be willing to help Japan at a point when this has a plausible chance of working. Because the yen starts off from such an undervalued position, because Japan actually has a decent fiscal situation. It's got a lot of debt. Should look at net, net net debt, not just gross debt. But its fiscal deficit was down to 1% of GDP, may go up to 2. That's way below our fiscal deficit. Japan has a big current account surplus, 5% of GDP. We got about that much on the deficit side. Japan has a ton of foreign assets. And the government of Japan can sell assets reserves that it bought at 80 into the dollar now for 160. And in the process, because of the way Japan holds its reserves, are part of the Finance Ministry's balance sheet, not the central bank's balance sheet that reduces reported debt. All that's to say is this has a chance of working in order, though, for it to work. Japan will have to adjust its interest rates

[Paula Newton]

and that is key, right? As you said, it will work in the short term. In the long term, though, usually the bond market has a way of correcting in the long term for all that ails domestic economies. Brad Setser, thank you so much. We are smarter for having spoken to you as we do a bit of a deep dive there on economic data. Appreciate it.

[Brad Setser]

My pleasure.

[Paula Newton]

And next we do want to turn to Lebanon, where Israel continues to strike in the south despite a shaky ceasefire and talks between the two countries last week in Rome. Now locals are returning home to in fact rubble and destruction. That's after weeks of intense bombardment that had forced them to flee. Correspondent Nada Bashir hears from Lebanese families as they begin to rebuild their lives,

[Nada Bashir]

clearing the debris of a home now turned to rubble, the result of a months long Israeli military assault on southern Lebanon. When the shelling started, my family fled, abu Ali says, and when I returned, everything was destroyed. His family fled the village of Zoltar, which overlooks the Netani river, in February and have only now been able to return following the withdrawal of Israeli forces. Inside what remains of their home, the remnants of this war, lay scattered Israeli bullets, he tells us, walls completely blown out, bullet holes above where his grandchildren once slept. We want calm, we want security, we want a state, he says. We want to be protected by the military. We don't want to fight. But if Israel attacks us, we will attack them. Abu Ali is far from alone among the more than a million people displaced from their homes by the war in Lebanon. Issam Hashem says he and his family of four returned to their village as soon as the military gave them the all clear after months spent sheltering in a school in Beirut. Take a look at this scene, the destruction. The Israelis were sleeping here in this room, hisam says. They even left behind their food and water. Through shattered glass and concrete, Hisam takes us to what was his children's bedroom. Out in the distance, he says Israeli tanks are still positioned. You can see them right in front of me, just a few hundred meters away, he says. Across Zaatar, the scars of this deadly conflict remain. Homes left crumbling, neighborhoods deserted, this monastery now bullet ridden and desecrated. The scale of the destruction here is reflected across southern Lebanon, and the recovery process could take years. While members of this community work to rebuild homes and restore critical infrastructure, some wounds are more difficult to heal. Many have lost their livelihoods. Most of the residents here depend on agriculture. There was a harvest season right before the war started People fled and left it behind. Abd al Zeddin, the mayor of West Zaltar, says, I believe there is a big percentage of farms that are not fit for farming anymore due to shelling and airstrikes. For many, this is not the first time they have been forced to flee their homes, nor the first time they have returned to find utter destruction. Locals here know just how fragile a ceasefire can be and how quickly everything can change. And while some say they are putting their trust in the Lebanese army to protect them, others say they remain faithful in their support for another military force. Force Hezbollah. The Iran backed political and military group has long dominated in the south. I'm proud that my husband, a fighter who defended his land, was martyred in his village, Israel. A mother and now widow, tells us she and her children fled the border village of TAIR HARFA In October 2023, their community coming under intense Israeli bombardment after Hezbollah launched a series of attacks on Israel in solidarity with the people of Gaza. War with Israel, she says, has impacted generations of her family, no stranger to Israeli occupations of the past. They killed my grandfather. My father was a prisoner of war, she says. All my uncles were tortured. My entire village suffered. Now, ISRA says she is determined to carry on the struggle. Eventually we will return to our village. And if we don't, then our children will return. And if they don't, our grandchildren will.

[Sokol Thurlow]

Yeah.

[Paula Newton]

Our thanks to Nanda Bashir reporting there. The depths of the destruction are certainly startling, I'd like to say with cnn. We'll be right back with more news after a quick break.

[Dr. Sanjay Gupta]

I'm Dr. Sanjay Gupta, host of the Chasing Life podcast. For a lot of people, it's obvious the appeal of medical tourism is all about the cost. It's about the price tag. But cost isn't the only driver, as you're about to hear. My guest today is Harvard Law School Professor Glenn Cohen. He's an expert in bioethics and the law, and he has written a book about medical tourism.

[Hari Srinivasan]

So it varies a little bit by country, but I'll give you some examples of things that are sometimes discussed in the literature. So sex reassignment surgery is an interesting example. Thailand has long been, I think, ahead of us in sex reassignment surgery, and many people think that that's a great place to go for that. India has often been a leading center for cardiac, but the US Is very good at cardiac, too. But when someone's thinking about cardiac, that's a possibility.

[Dr. Sanjay Gupta]

Listen to Chasing Life Streaming now, wherever you get your podcasts.

[Paula Newton]

So with The Trump administration's immigration crackdown under intense scrutiny. People have been training their cameras on ICE agents as they make arrests. Now the agency is apparently trying to turn the tables with a digital surveillance operation. It's left many thinking twice about what they post on social media after a number of individuals were approached by ICE agents asking about their activity online. Hannah Critchfield is a reporter at the Wall Street Journal who has been investigating these cases. And she joins Hari Srinivasan to discuss what she found.

[Interviewer with Hannah Critchfield]

Paulo, thanks. Hannah Critchfield, thanks so much for joining us. You wrote a piece recently in the Wall Street Journal titled How ICE is weaponizing Social Media against its critics. What did your investigation find? Walk us through it.

[Hannah Critchfield]

Yeah, thanks so much for having me. So I and a colleague found that in recent months, ISIS deployed this round the clock digital dragnet to scour the public Internet, from Facebook to Instagram to X for speech that could endanger the agency's mission. And we found that the government has paid millions to private contractors to help carry out this work. Both US citizens and activist groups that alert community members about ITIs activity in their area have been flagged under this monitoring.

[Interviewer with Hannah Critchfield]

Okay, give me an example of people that were caught up in this dragnet.

[Hannah Critchfield]

Sure. So we found that the agency has issued hundreds of subpoenas related to online speech to try and unmask anonymous posters. One of the people that the agency is currently trying to unmask is an anonymous Reddit user. They go by the name Tired Thumb on Reddit. And the agency initially filed a subpoena requesting this person's identity and details about them related to about a month and a half of online speech. One of the things that has come up in our reporting is that oftentimes when the agency issues these subpoenas, there's not a lot of detail about why or what the speech was that brought this person under the government's eye. But we identified that, you know, between January to mid February of this year, this anonymous user posted about the agency three times. Each time, it was criticizing immigration agents after a US Citizen had been killed by an immigration officer. One was after Renee Goode, and two were after Alex Preddy was fatally shot. And it is a really interesting thing because we find that there are a lot of investigations going on, but oftentimes the people who are being investig don't know what exactly it is that they did. But their defense attorneys have repeatedly said that they were posting First Amendment speech that was critical of the agency.

[Interviewer with Hannah Critchfield]

There was a chief legal officer at Reddit who put out the statement privacy is central to how Reddit operates. He said the company routinely objects to government requests that are quote overboard or threaten users privacy or civil rights, including their First Amendment rights. He added that we also notify impacted users whenever possible so they have the opportunity to seek counsel and defend their interests. Interests. In any of these statements that ISIS going after these people for, was there specific kind of intelligence that they were sharing or was it just that they didn't like what was going on?

[Hannah Critchfield]

The agency says that they are experiencing an 8,000% increase in death threats against their officers and their officers families. And they say that the things that they're investigating are all credible threats. We also know that during this administration the agency has embraced a broader definition of what constitutes as doxxing. This is traditionally thought of as sharing someone's personal information. Under this administration, DHS has said that posting footage of an officer on the job online is doxing. It has heavily implied that news outlets who publish the name of the the officer who fatally shot Renee Goode were engaged in reckless, harmful behavior that endangered the life of their agents. We know that the agency has taken a really hard line stance on doxxing. They have asserted that it is a crime itself. Legal experts we spoke to said the reality is a little bit more nuanced. In order to break the law to commit a crime, you have to share this personal information with some sort of criminal intent. That's actually really hard to prove in a court. And some of the civil rights and defense attorneys we spoke to about these investigations that ISIS opened have theorized that that's partially why you're seeing so few charges being filed. You are seeing a lot of people be investigated for their online speech, but fewer actual charges. So they have posited it may be an intimidation tactic. ICE says that they are doing their job to investigate credible threats.

[Interviewer with Hannah Critchfield]

You said that the spending on surveillance technology and consultants reached $258 million in the president's first full year back in office, which is a 57% increase from the year before. You also point out that they've paid out nearly $50 million since 2020 on these around the clock operations, at least in six different contracts. Give me an idea of the kind of dossier that they are able to compile during the surveillance. What kind of information about people they're concerned about? Can they gather? Do they gather?

[Hannah Critchfield]

The government has paid millions to these private contractors and they are tasked with surfacing two types of online activity. Potential threats to agents, to ICE employees, to their families. And speech that could potentially disrupt ICE's operations. They use these powerful open source investigative tools to allow for constant monitoring in the background. And then they prepare daily reports for ICE about speech that they found online, as well as ad hoc emergency alerts to the agency. For instance, you know, contractors might notify ICE if they're seeing a lot of chatter from a rapid response group in a particular area. So agents in the field can have this situational awareness about, about possible attempts to impede their work. But they're also asked to prepare dossiers on people who have posted speech that's deemed potentially threatening if they're able to. These reports include the person's name, their location, right down to their home address, their date of birth, Social Security number, vehicle registration, and criminal history. They hand these over to ices staff who can develop it further. One way this might happen is through the subpoenas that we've spoken about before. If a threat actor can't be identified, agents might issue a subpoena to a social media company for their identity.

[Interviewer with Hannah Critchfield]

You report out that there have been all these different subpoenas. Who are they going to? What are the platforms that their ICE is surveilling, and what do the platforms do in response?

[Hannah Critchfield]

So the notice for this specific contract calls for the monitoring of the public Internet, which means both the dark web aspects that, you know, you and I and perhaps many viewers have never thought about accessing, but also really commonly used social media. The notice for this particular program calls for the monitoring of more than 20 media social media sites. That's LinkedIn, Reddit, Discord, Snapchat, though it may be monitoring even more than that. When I say the public web, I mean that law enforcement often has approached social media as an investigative tool only using things that are available in the public eye. It's sort of like they can, without a search warrant, observe someone perhaps exchanging drugs in a transaction in the public eye. If my Instagram is private, they're not looking at me. But if my Instagram is public or I'm posting on a public Facebook group, that is something that's coming under this kind of monitoring. And for sites like Reddit, where a lot of it is just open and publicly available, that's all subject to monitoring at any time. In terms of subpoenas, DHS has issued subpoenas to Meta for Facebook and Instagram accounts. They've issued subpoenas to Reddit, to Google, including for emails that individual users have written to agency staff. So it's a really wide variety of social media Companies that we know have been asked to turn over this information about users.

[Interviewer with Hannah Critchfield]

And I wonder again, what is that level of cooperation, whether it's Meta or whether it's Google? And if they're barraged with 100 of these, do they have kind of a systematic review of every single request the government is making, or did they just say, you know what, we're just going to trust the government is good for it, and we're going to hand over this data?

[Hannah Critchfield]

This is one of the things that came up again and again in our reporting. These subpoenas that are sent on behalf of ice, they request that the social media company not reveal their existence to anyone. So it's up to the platform to decide whether or not to comply with that or alert the user in question. It's possible people have had their identities turned over to DHS without. Without ever knowing they're the subject of an investigation. That said, companies we spoke to do, they said that they do alert users about these subpoenas when possible, like you mentioned, so users can then find legal representation and push back. Both Reddit and Meta, which owns Facebook and Instagram, also provided specific examples of times that their attorneys push back on behalf of users when they felt the subpoenas were overly broad or targeting First Amendment speech. But it's unclear in broad terms how often this happens. I think your question gets to the heart of this. We don't know how often this is happening to users on a given platform, how often a social media company is notifying users, how often that platform is pushing back versus expecting the user to find their own legal representation, or even how often it receives requests from DHS related to speech about immigration or officers. Overall, unless a company chooses to disclose it, it's entirely optional for them to share this with the public.

[Interviewer with Hannah Critchfield]

So DHS has said in a statement that any allegation that DHS and ICE are attempting to squash free speech is categorically false and that ICE investigates all credible threats towards its employees, officers, and families. Tell me a little bit about the poll worker. I think it's Paige. Lyn Gagne.

[Hari Srinivasan]

Right.

[Interviewer with Hannah Critchfield]

What happened to her?

[Hannah Critchfield]

Yeah. So Pagelyn is working as a poll worker during New York's primaries in June and sees that there is a voicemail from an unknown number, and she listens to it, and it says that the person who's calling is an agent with the Department of Homeland Security. They just stopped by her house and someone passed along her number and. And that they were looking for her to speak to her about an Instagram post. Where she doxed an agent in January. Then they deliver this letter to her at the polling site. They ask her to sign it. She says, I'm not comfortable signing. I want to talk to my lawyer. But she keeps the letter. And it's actually why initially anyone knows about these letters in the first place. She posted on her public social media. She has continued to post publicly, but said as a result of this incident that people online have dug up her information where she lives, things about her past. Pagelyn has said she has no recollection of ever doxxing an agent and that the only social media post she could find about an agent from January was one where she said that Jonathan Ross should be indicted. And she shared the original Minnesota Star Tribune article that revealed his name and that he was the agent who shot Renee Good. Dhs, I should say, provided they showed me a screenshot of a different post that appeared to be from Page Lynn's account that was redacted. It said the killer's name is Jonathan Ross of and the rest of it was redacted. And they said she shared his address in this post. We attempted to contact Meta to try and understand, to see if they would verify the existence of this post or not. It's not currently on Page Lynn's Instagram. It didn't appear in her deleted folder. It didn't appear in her metadata. I should say sometimes deleted posts do not appear in any of those places after. And that's part of the challenge of the agency investigating her more than five months after she allegedly exhibited this behavior.

[Interviewer with Hannah Critchfield]

So has the government made successful convictions, indictments against people who they have found through this dragnet?

[Hannah Critchfield]

Definitely. And one thing that I don't think anyone disagrees about is that vitriol towards ICE and immigration officers online, it's high right now there is a lot of online vitriol and there have been some instances in the last year of people being prosecuted and convicted for related to speech that they made online. There was a man in Oklahoma who was convicted of threatening to kill federal agents because of some of the things that he wrote on X. There's another instance where two women were convicted in a Los Angeles court of stalking because they were live streaming from an ICE Watch account on Instagram that were live streaming as they followed an agent in his vehicle. Both. Both of the defendants have said that they thought that they were following this agent to an immigration raid. Ultimately, though, the agent was driving to his home and they ended up at his streets and it didn't reveal his address, but it did reveal where he lived. And so they were they were ultimately convicted of stalking for that. So there have been prosecutions and convictions for online speech, specifically for endangering or intimidating or stalking immigration agents.

[Interviewer with Hannah Critchfield]

Hannah Critchfield, reporter at the Wall Street Journal, thanks so much.

[Hannah Critchfield]

Thanks for having me.

[Paula Newton]

And finally for us, a moment of reflection marking the 81st anniversary of the atomic bomb in Nagasaki. The bells in Nagasaki rang on Sunday at 11:02am local time time, the exact moment the bomb hit the city in 1945, only days after the US dropped the first atomic bomb in Hiroshima. Christian spoke with one of the survivors of the Hiroshima bombing on the 75th anniversary back in 2020, announced that Sokol Thurlow was only 13 when the bomb hit. And she has been sharing her story ever since. Here's what she she saw on that day.

[Sokol Thurlow]

I saw the bluish white flash and I still have the sensation floating up in the air. And when I regained the consciousness, I found myself in total darkness and total silence. And I tried to move my body, but I couldn't. So I knew I was facing death. Then I started hearing faint voices of my girlfriends around and they were asking for help from their mothers, from their God. And then somebody strong male voice said, don't give up, don't give up. Keep pushing, keep kicking. I'm trying to free you. So with this man in the dark, I was risking

[Paula Newton]

incredible stories of survival.

[Ancestry Narrator]

There.

[Paula Newton]

That is it for us. If you ever miss our show, you can find the latest episode shortly after it airs on our podcast. And remember, you can always catch us online, on our website and all over social media. Thanks for watching and goodbye from New York.

[Congressman Steve Cohen]

Go inside the sports moments that brought us together and made history. From the underdogs to the rivalries and

[Brad Setser]

the miracles, it sends chills down your spine. It's what sport was all about.

[Congressman Steve Cohen]

The new CNN original series, Decades in Sports, now streaming on the CNN app.