short is the highest profile witness known to have testified in the criminal investigation. also tonight, a make or break week for the u.s. economy. recession fears and an interest rate hike might and highly anticipated economic data is weighing on the white house right now. a newly signed deal to loosen the russian strangle hold on the u.s. grain supply is in jeopardy tonight after kremlins attacked a city on the black sea. i'll discuss with john kirby, a key national security official this hour. welcome to our viewers here in the united states and around the world. i'm wolf blitzer, you're "the situation room." ♪ ♪ we begin our coverage this hour with the criminal probe into the january 6th, it's apparently gaining steam right now big time with a federal grand jury interviewing a major

witness. our congressional correspondent ryan nobles is joining us from capitol hill. ryan, as far as we know, former pence chief of staff mark short is the highest profile witness to tv in the criminal investigation. what can you tell us? >> that's exactly right, wolf. mark short is among the people that has the most insight into what was happening on january 6th and in the time leading up to january 6th and specifically the pressure campaign on his former boss vice president mike pence and what this all shows is that that criminal investigation won by the department of justice is expanding at the same time the january 6th select committee's work is far from done. the january 6th select committee is far from done. >> the committee will be in order. >> reporter: planning hearings for september and promising their august will be spent expanding an already sprawling investigation. >> we anticipate talking to additional members of the president's cabinet. we anticipate talking to

additional members of his campaign. >> reporter: all this while tonight, revealing new information they've uncovered. >> was the implication that the president was in someways reluctant to give that speech? >> yeah. >> okay. what do you base that on? >> the fact that somebody has to tell me to nudge it along. >> reporter: the committee sharing a video montage of interviews they conducted to show how former president trmp c -- trump cut lines from a speech he delivered the day of the capitol riot. >> you can see through the documented there are lines crossed out and there are some words added in. do you recognize the handwriting? >> it looks like my father's handwriting. >> reporter: trump cutting criticism out rioters as pat sip lonely made clear they thought the president needed to send a clear message. >> in my view, he needed to express very clearly that the

people who commit a violent act went into the capitol, did what they did should be prosecuted and should be arrested. >> reporter: the committee is also trying to determine what members of the secret service were up to after the homeland security inspector general accused the agency of deleting text messages from january 5th and 6 th. >> we have information we're requesting and receiving from the secret service and there is a lot of questions still to be answered on that front. >> reporter: the committee still wrestling how to handle ginni thomas who was in touch with trump chief of staff mark meadows and john eastman encouraging them to continue efforts to overturn the election. >> it's very important for us to speak with her and as i said, i hope she'll agree to do so voluntarily but i'm sure we'll contemplate a subpoena if she won't. >> reporter: committee members making it clear they want the

department to act. >> i hope they have a criminal investigation into donald trump. >> reporter: meanwhile, an investigation in georgia is lurching forward. the district attorney dealt a blow today, a judge blocking her from investigating state senator burt jones who is running for lieutenant governor. while the d.a. can gather evidence about his role as a fake elector, she cannot make him a target of her probe because she hosted a fundraiser for his opponent. but another major witness, governor brian kemp did cooperate by submitting a video statement to the grand jury. kemp resisted pressure from trump to stand in the way of the certification of the election in georgia. kemp's office declined to comment on the message, the governor shared with the jurors. there is no time clock on the investigation that is greatly expanding by the department of justice. the same cannot be said for the january 6th select committee. conventional wisdom dictated they would wrap things up by the election but committee members are now saying they may continue

their work past election day, saying that the only thing the resolution says about concluding their work is they have to issue a final report, something they have complete control over of course, things can change in a big way if republicans win the majority this fall, wolf. >> good point. ryan nobles, thank you very much. let get analysis from the chief legal analyst jeffrey toobin and a constitutional law professor at harvard law school lawrence tribe. professor tribe, you tweeted this today. you said it's time to tell attorney general merrick garland he has no choice but to indict the former president. not indicting trump you say amounts to giving him an unearned pardon. garland was actually a student of yours at harvard law school. is it dangerous in your view for him not to indict the former president trump? >> i think there is no excuse at this point for not going ahead with a criminal prosecution of

donald trump. as i said in that tweet, not prosecuting him based on everything we know about the pressure campaign aimed at his vice president and everything we know about his attempts to abinst obstruct the investigation not prosecuting him would be giving him an unearned pardon. if it was earned, if trump and this is unthinkable were to be contripe and to admit his guilt, the pardon power doesn't belong to the attorney general. it's not part of his job description. so all of this talk about he has to, you know, he has to worry about the harm to the country of indicting a former president is beside the point. those issues, the issues of whether it would bring harmony or division, those are above his pay grade, honestly and those

are questions for the pardon power. just like, you know, when gerald ford decided to pardon richard nixon to help heal the country. it necessarily didn't do all of that but it was within ford's mandate to consider it. it's not part of an attorney general's mandate. he's not healer in chief. he is prosecutor in chief and the evidence is now overwhelming to justify the prosecution of the former president. >> let me get reaction from jeffrey. not only was attorney general merrick garland a student of president tribe's -- professor tribe's i should say but you were, as well. do you agree with your professor on this? >> i'm always wary of disagreeing with larry about anything but i think his statement is a little premature. this is a very appropriate day to talk about this. there has been a lot of criticism of the garland justice department for only focussing on the people in the capitol and

not the higher level potential offenders. now we know that the former vice president's chief of staff was in the grand jury. these are the people that should be in the grand jury exploring president trump's role in the potential conspiracy to abinstruct congress and defraud the united states and i think it's a positive step that people at that level are now in the grand jury but whether there should be an indictment, i think we need to see more evidence but there is certainly plenty of evidence to justify an investigation and we'll see about that. >> let me get professor tribe to react to what his student just said. go ahead, professor. >> i think jeffrey was a better student frankly, a better student than he is observer of the current scene. what are we waiting for?

he says it's premature, i'd rather be ahead of the curve than letting the clock run out and waiting until the democracy is completely lost. i think in this case, we have more than enough evidence. we've seen it with our own eyes, we've heard it with our ears. come on, jeffrey, i think you're being a little slow on the uptake this time. >> go ahead, jeffrey. >> i just think it's important to draw a distinction between the january 6th committee and house of representatives and the justice department. the january 6th committee is likely to go out of business because the republicans are likely to retake the house. merrick garland and the justice department are not going anywhere for the full joseph biden's full term so i don't think there is the same urgency to proceed. i do think the justice department has been somewhat slow but they are now moving forward and i think, you know, if you look back to watergate, if you look back to other big

scandals, you know, it took over a year. it took in some cases two years to bring a big full conspiracy case and that may be the case here. i'd rather see the justice department move slowly and methodically but i'd like to see them move. >> all right. i'll give you one last chance professor to respond to jeffrey. >> you know, jeffrey, you may have forgotten something you learned in constitutional law, the power of the purse belongs to congress, yes, it's true the executive branch will still be in business but i wouldn't count on, you know, the house of representatives in the senate if they both happen to be in republican hands, i wouldn't count on them funding even the turning on of the lights at the department of justice, let alone hiring all the people they need to hire to pursue this extraordinarily complicated case. yes, the crack is ticking and i do not think we should be waiting. >> what does it say to you,

professor, that mark short, the former chief of staff to then vice president pence has now testified, he testified last week before a federal grand jury investigating january 6th? >> says to me that merrick garland has got the message, that he knows he cannot afford to be any more methodical than he has already been. he's been methodical. he's taken his time but now the evidence is incredibly clear. it's clear. we know now more than we knew even a couple weeks ago. we know that there was a mob that the president knew it was warmed, that he said no problem, they're not going after me. he tweeted that the vice president was a coward. he inflamed the mob against the vice president. we know all of these things and i'm sure merrick garland of the department of justice know them as well. seems to me now that mark short,

too, has testified that there is really no reason to wait. >> this is a criminal investigation, jeffrey. so how do you read this development? >> well, it shows that this investigation is a lot broader than just about the people who went inside the capitol. it's not just about the oath keepers. it's not just about, you know, the physical violence. this is also an investigation of whether there was corrupt pressure put on the vice president to try to betray his oath and interfere with the peaceful transfer of power. that is a very legitimate thing for this grand jury to be investigating. it is certainly -- the evidence that's been developed by the january 6th committee certainly suggests that this investigation should reach whether there was corrupt pressure put on the justice department. i'm just not ready to see an indictment just yet but maybe that time will come. >> we shall see.

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inflation is up, interest rates are up and this week, we'll be seeing a new set of numbers that will give us a clearer indication of where the u.s. economy is heading potentially including into a recession. here is cnn white house correspondent m.j. lee. >> we're not going to be in a recession in my view. >> reporter: a blockbuster week of u.s. economic data as the biden white house is on recession watch. administration closely monitoring several key indicators coming in the next few days, that could offer important clues on the direction of the economy. >> my hope is we go from this rapid growth to a steady growth and so we'll see some coming down but i don't think we're going to god willing, i don't think we're going to see a recession. >> reporter: on tuesday, the consumer confidence index, an important measure of the public's economic outlook.

on wednesday the federal reserve expected to announce yet another interest rate hike as the central bank tries to cool down the economy and on thursday, quarter two gdp numbers. >> the enplmployment rate is th lowest, 3.6 area. >> reporter: president biden and his top economic advisors attempting to highlight the strength of the u.s. labor market. including a low unemployment rate and robust pace of hiring. >> the spring and early summer, during the three-month period, the economy created 1.2 million jobs. about 400,000 jobs a month. >> reporter: record high inflation remaining a stubborn economic and political problem for president biden and last year incorrectly predicted that high prices would be a fleeting phenomenon. >> by the ware, inflation, the overwhelming consensus will pop

up and go back down. >> reporter: with the midterm election four months away, public polls showing the majority of americans unhappy with biden's overall performance including his handling of the economy and inflation. according to a new cnn poll, 64% of americans believe the u.s. is already in a recession. other top u.s. officials also insisting that that is not the case. >> certainly, in terms of the technical definition, it's not a recession. >> what a recession really means is a broad base contraction in the economy and even if that number is negative, we're not in a recession now. >> reporter: wolf, we did just get a health update from the president directly. he of course, has been isolating ever since he tested positive for covid. he told reporters that he got two full nights of good sleep, that his test, his vitals, everything is coming back normal, that what is left is his

voice a little raspy and a bit of a sore throat. today is day four of isolation. the cdc says to isolate for at least five days so the president telling reporters he hopes to be back at work in person by the end of the week. wolf? >> we wish him a speedy recovery. thank you very much. let's take a closer look at all of this joining us now cnn matt. if the u.s. does in fact go into a recession, how will that present itself in the everyday lives of americans? >> hopefully, the united states can avoid a recession. many americans are still recovering from the last downturn that began barely two years ago. we don't know for certain if a recession is coming but we do know it would be a painful for experience for millions. it would mean a surge in layoffs that lifts unemployment off historic lows, pay cuts for workers, bankruptcies for small, medium and large companies and market chaos that shrinks our

nest eggs. a recession could ease very high inflation, although there is no guarantee. the nightmare scenario would be a recession and high inflation, what is known as stagflation. americans are getting crushed by the cost of high living and this is forcing the federal reserve to take dramatic steps to get inflation back under control. >> as far as that is concerned, in terms of this expected rate hike, maybe this week from the federal reserve just how high should americans be bracing for rates to go? >> wolf, the fed is clearly been late to the scene of this inflation fire and so now they are trying to play catchup by aggressively raising interest rates, designed to cool inflation off. they have been steadily increasing their pace of rate hikes in recent months. last month, raising interest rates by three quarters of a percentage point, the biggest single move since 1994. it is a slam dunk that they're

going to raise interest rates again at this week's meeting and investors are betting a rate hike of the same amount. we haven't seen anything like that in back to back meetings in recent history. at least not since the fed introduced a target range in the late 1980s. for families, this means higher borrowing cost, credit cards, car loans and of course, mortgages. mortgage rates have basically doubled from a year ago and that means that for many families, they're going to be priced out of the housing market because people can't afford the borrowing costs. the problem here is that the more the fed does to try to cool off inflation, the greater the risk that it accidently slows the economy into a recession. this is not going to be easy, wolf. >> you're absolutely right. appreciate it very, very much. coming up, a key development on the war on ukraine as the country tries to resume critical grain experts. we're going live to the scene when we come back.

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days, we will start delivering grain from our ports in odesa. >> reporter: russian missiles aren't the only obstacle creating uncertainty. russia's foreign minister asserting nothing in the deal prevents them from hitting military targets in odesa and misinformation, too, claiming rights for russian ships not in the agreement. >> see russia together with another participant which is to be determined to accompany the convey to the straights. >> our territorial waters and seaports on ukraine and ukrainian navy will be there. >> reporter: so no russian ships escorting the convoys anywhere along the convoy? >> no ships in this process. >> reporter: ukraine's plan b to export grain by train, truck and

river is still in play but like the u.n. deal, this, too, is beset by uncertainty. train cars full of grain have been shelled by russia and tracks blown up. >> we're again doing our best trying to export more with the help of our rail way, ukraine rail way company and by trucks. >> reporter: if the u.n. deal to export grain from the ports can hold, ukrainian officials estimate the value to their nation could be a much needed billion dollars a month. what we've heard from president zelenskyy this evening, he, too, like his officials absolutely committed to getting this deal done. in indeed, ukraine sent officials to istanbul to be part of the joint center that will monitor this deal. that's important that will have ukraini

ukrainians, russians, the u.n. and tourkish on board. how will russia play its hand? it can't predict or control. >> nick robertrobertson inyiv f. john, thanks for joining us. as you heard and as you know, russia struck odessa, the port city a day after signing this deal but the russian foreign minister sergei lavrov claims this didn't break russia's commitments. how do you respond to him? >> it's disconcerting to see the strikes less than 24 hours after signing this deal but then the russian sort of cavalier attitude about this. these strikes actually did hit the port of odesa and we have some indications that they certainly got close to some grain terminals, whether they damaged the grain terminals or not, we haven't seen exact battle damage assessment. it flies in the face of what they say is their commitment to

be good faith participants in this arrangement to get grain out so we're going to be watching this very, very closely. unfortunately, wolf, we seen this before. you can go back into the war in syria where they were hitting humanitarian aid shipments meant for syrian citizens and refugees this is just something unfortunately we seen out of their playbook and hopefully this won't happen again and they will actually participate in good fifth in istanbul. >> let's hope that happens. so many millions of people around the world need those grains in order to survive to eat. ukraine is about to get, john, four more high moebbility rocke systems from the united states but there are concerns russia is adopting ukraine wants more and wants missiles with a much greater range. is that on the table? >> well, we are in talks with the ukrainians literally every day, wolf, about their capabilities. i wouldn't at this point tell you what is on or off. i can tell you we're continuing

to explore with ukrainians near realtime what their capabilities are in trying to get them the capabilities as fast as we can. you're right, another four high mars. they are being used very, very effectively by the ukrainians in the field and give standoff range, a chance to hit deeper behind russian lines and we know it's having an effect on russian operations in the donbas and south which is why we'll continue to contribute the systems as much as we can. i would note other nations are also providing these high mobility advanced rocket systems, artillery rocket systems, the u.k. has, germany has, it's a got sign. >> while i have you, i want to ask about house speaker nancy pelosi's possibility trip to taijuan. the president thinks this isn't a good idea. will president biden tell her directly to call off this trip? >> i won't speak to private conversations between the president and the speaker of the house. the speaker makes her own travel

plans. she makes her own decisions. we respect that. our job inside the national security establishment is to make sure that as she goes through that decision making she has all the facts, all the content and information she needs from a perspective and geopolitical perspective. we're doing that. i'll leave it to her to decide whether she's going to make a trip or not. we're making sure she has all the information relevant to her. >> let me ask you yes or no, is it safe for the speaker nancy pelosi second in line to the presidential succession to travel to taijuan? >> i won't get into specific intelligence assessments here. wherever she goes, there obviously has to be an appropriate security footprint no matter where she goes overseas and that's part of advice and counsel that we provide her and her team. we will do -- if she travels, we'll do everything we can to make sure she does so safely and

securely. >> thanks for joining us. >> my pleasure. just ahead, former president trump returns to washington just as his rivalry with his former vice president is heating up big time.

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senior advisor. the former president will return to the nation's capitol tomorrow. this will be the first time since leaving office to come to washington supposedly he wants to give -- wants to come to give a major policy speech. that's what he's calling it. are we seeing what could potentially be the beginnings of his 2024 presidential run? >> yeah, i think it is, wolf and look, he's going to have targets. he's going to fire at. he's going to talk about the economy and talk about the border, he's going to talk about gas prices, he's going to talk about afghanistan. these are all target rich for him. the problem he's going to have, i think, is he doesn't have any solutions. he's going to just lay this out. i think it will be much of it is going to be based on attacks on joe biden but i don't think you're going to hear a lot of new ideas out of donald trump. i mean, he may say we need to drill more, we need to build more walls but that's hardly a

significant policy but the whole purpose of it, i think, is to come in here and really try to compare what his record was with joe biden's and he's going to pick the things that allows him to have the most effective hits on biden. that's what i think we're going to see. >> david, we were supposed to hear from former vice president pence earlier today, as well. he was supposed to be in washington but his speech was cancelled due to the weather. it seems like these two men are on a bit of collision course right now. pence was expected to take vail swipes out trump in his speech here in washington. >> well, in fact, wolf, i think the two speeches are somewhat related because the swipe that pence was going to take as some people want to talk about the past, i think we as a party need to talk about the future and the reference of course was to president trump's obsession with the 2020 election and disputing the outcome of the 2020 election, which is really --

these are the domination of the public appearances and his statements. i think his people are hoping that the speech that he gives tomorrow will be forward looking in the sense that it projects into the race with president biden. the scenario that governor kasich laid and that he doesn't sort of drift off script and make more references to 2020. as you said, john kasich talks to more republicans than any of us but what you're hearing is what we hear in focus groups. a lot of voters like what trump did and don't particularly like what happened on january 6th and more than anything, they don't want to hear about it anymore and that is what has really contributed i think to a lessoning of support, at least support for him to run again. so i think what his folks are hoping, he can pump up his

support for a 2024 campaign by making a future oriented speech. >> at this point, governor kasich, could anybody, even pence let's say give trump a significant primary challenge? >> first of all, i don't know what pence is doing. it's like what are people going to go for pence because he's trump light? i don't know why he's tiptoeing around and being careful what he says. he doesn't want to make trump supporters angry or something. i think, wolf, you may have a candidate or two who will have money, david knows this as well as i do in politics, you know, money is the mother's milk. if you have significant sums of money, you can then organize, you can get organized in the states and do advertising and become better known and that's what you have to keep your eye on. there are billionaires now looking around and looking at other candidates. they're funding some of them. i don't know where they're going to come when this is all over but that's really the question is what is the money game and we'll be talking about that for

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we're back with a cnn exclusive into potential chinese espionage on u.s. social. chinese made tech equipment installed across the country

could disrupt sensitive american military communications including information about the u.s. nuclear arsenal. brian todd is working this story for us. what exactly is this equipment capable of doing? >> one cybersecurity expert says they could use this to block or scramble important phone calls by u.s. military officials rae gu -- regarding the u.s. readiness of the weapons this is a part of a chinese spying operation inside the u.s. >> three, two, one, turn, turn. >> reporter: america's arsenal of nuclear armed ballistic missiles at the ready and underground silos in rural remote areas of the u.s. could threatened with vulnerabilities tonight. officials have long raised alarms about chinese made equipment manufactured by the firm waway sitting on top of cell towers, near u.s. military bases in the rooural midwest. multiple sources tell cnn the

fbi termed that equipment was capable of capturing or even disrupting restricted u.s. military communications including communications from u.s. strategic command, which oversees america's nuclear weapons. >> so it could allow china to for example collect the communications of military officials moving around and in between these various different instillations. >> reporter: katy willis has a new report on a multi year investigation by u.s. officials into china's ramped up espionage operations inside the u.s. she says it's not clear if the u.s. intelligence community has found whether any sensitive dat sent back to china where equipment is used. even though american bases use encrypted communications. >> it's pretty hard, that might not be easy to do but doesn't mean our opponents won't try to figure out how to do it. >> reporter: it doesn't end

there, according to multiple sources fa mi sources familiar with the matter in 2017 china offered to spend included temples, pavilions and a pagoda, but when counterintelligence officials began digging, they found that pagoda would have been strategingic placed inside the grounds on one of the highest points in the city, just two miles from the u.s. capital. >> the concern for counterintelligence officials was china was going to be able to use this friendship garden, this pagoda as a prime platform for signals intelligence. >> u.s. officials quietly killed that chinese project before it got started. as for the chinese equipment sitting on the cell towers, they report that in 2019, after the fbi briefed the white house on their existence, the federal communications commission orded the american companies using that equipment to remove it from the cell towers, but bonot enou

money was allocated to reimburse companies for that. >> that equipment is still sitting there and still in use. >> the chinese government denies any efforts to spy inside the u.s. huawei said all of its products imported to the u.s. have been tested and certified by the ftc before being deployed. and the company says it's never been involved in any malicious cybersecurity incidents. wolf. >> brian todd reporting for us. thank you very much. let's discuss all of this with cnn counterterrorism analyst phil mudd who is with me now. you served in the fbi. how damaging potentially would it be if china could use this equipment to spy on the u.s. military community, including on the nuclear arsenal? >> i think it's hugely significant. you're not just talking about spying on the nuclear arsenal in the midwest. you're talking about countries like iran and china and russia

looking at military infrastructure, but think about things like u.s. water, u.s. electrical grids. in the event of a conflict, countries like china are absorbing so much information, you have to ask the question, how would they use that information, not with bombs but by shutting down america, in this case, potentially america's control of nuclear weapons in the midwest. >> so far we'll told none of this chinese equipment brought over here has been removed. just how vulnerable is the u.s. right now? >> i think if you step back and say we don't see any information they're intercepting direct communications, if you're an intelligence professional, you want to know, if there's a training exercise in the midwest in these facilities, does incommunication change? you don't have to actually intercept a phone call. you can see patterns changing. as long as this stuff stays up and the chinese government can tell huawei what to do, they can learn a lot, wolf. >> they certainly can.

thanks very much, phil mudd. >> we'll have more news just ahead. firefighters are battling an aggressive blaze outside yosemite national park. we'll go there live when we come back.

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is it on the green? [goose squawks] i was just looking for my ball. 19th hole, sam adams summer ale. [goose squawks] (here you go.) (cheers guys!) americans are under heat alerts after high temperatures smashed records over the weekend. the northeast could get some relief later this week, but the heat in the pacific northwest is expected to grow even more intense in california, ferocious wildfire is raging outside yosemite national park, and forcing thousands and thousands of people to evacuate their homes. officials say this mega fire is moving extremely fast and displaying unprecedented, their word, unprecedented behavior. adrian broaddus is joining us from out in california. have emergency personnel been able to contain this fire at

all? >> wolf, they finally have been able to contain the fire. it's now at 10%. and that is up from, of course, zero percent containment over the course of nearly two days. at least or i should say more than 16,000 acres have burned here behind me. i want you to take a look, i'm going to step out of the frame so our viewers at home and around the world can better see. you'll notice this orange linear line at the foot of the sierras. that is flame retardant. fire officials were here using aircraft to drop this retardant on the area here. their goal was to protect the homes that are just under that orange linear line. they succeeded, when it comes to protecting the homes there, but in other neighboring -- neighborhoods, there has been some destruction. fire officials say this oak fire, as they have described it,

is moving rapidly and quickly. our next update will come from fire officials soon after i speak with you, wolf, i just spoke with a spokesperson with the fire department a short time ago, and he says one of the challenges firefighters are facing is the topography. if you look around, we're in a rural area. there's a home on the other side of this camera, and the homeowners here have allowed us to stage in this area. one of the homeowners has remained here, but they were worried that their home and their neighbors' houses would be threatened as well. and if you're wondering what the topography is like here, it's rugged and as i mentioned rural, and there are a lot of steep canyons. >> very quickly, why are officials describing this fire as unprecedented? >> in part because it's moving so rapidly. for example, we heard from a fire official earlier who said it moved so quickly, they had

very little time to tell folks in the community to evacuate. many of them leaving with the shirts on their backs. >> adrienne broaddus on the scene for us, be careful out there. thank you very, very much. to our viewers, thanks very much for watching. i'm wolf blitzer in "the situation room." erin burnett "outfront" starts right now. "outfront" next, pence's former chief of staff testifies. marc short now believed the highest ranking official from trump's white house to cooperate with the federal investigation into january 6th. he will be "outfront." >> plus, quote, medieval hell, dripping in blood, surrounded by carnage. those are the words of president biden, words we have never heard him say in this context before. he's talking about president trump's refusal to act during the insurrection. >> and air raid sirens tonight in taiwan. chilling sound as china threatens the u.s. if speaker nancy pelosi goes to taiwan. will china really act or is it all bluster? let's go