Authority to Fire: CDC’s Susan Monarez & Fed’s Lisa Cook 8/28/25

0:00Bring in show music, please. This is Squawk Pod and I'm CNBC producer Cameron Costa. On today's episode, the nation's health system in operational chaos. The CDC director ousted after refusing to resign. They accused Health and Human Services Secretary Robert F. Kennedy Jr. of, quote, weaponizing public health. All while our vaccine and public health policies are shifting. Former White House policy director Dr. Kavita Patel joins us. There's more confusion about everything from the top, because if you go to a government website, I'm not sure that you can trust the critical information they're recommending.

0:44And Facebook co-founder Chris Hughes now leads the Economic Security Project, and he's speaking out against the White House's push to influence the Fed, from the inside and from the outside. The reality is that this is the most aggressive assault on Fed independence that we have ever seen. Plus, Chinese EV maker BYD in the left lane. The company has overtaken Tesla in Europe. Maybe our cars, even though we like to think we've got great cars, will never catch up or be as good. It's Thursday, August 28th. Squawk Pod begins right now. Stand under by. Three, two, one. Up and under. Cue. Good morning and welcome to Squawk Box right here on CNBC.

1:30I'm Andrew Ross Sorkin along with Leslie Picker and Wilford Frost in for Becky and Joe. We've got a big show that we continues to be crazy in terms of just the amount of news coming at us, guys. The Trump administration firing the director of the CDC hours after she refused to resign in a statement. A White House spokesman said Susan Meniere is not aligned with the president's agenda of making America healthy again. Monero's lawyers said she would not resign and had been targeted for refusing to, quote, rubber stamp unscientific directives at the CDC and get rid of health experts. They accused Health and Human Services Secretary Robert F.

2:09Kennedy Jr. of, quote, weaponizing public health for political gain. At least four top government health officials announced their resignations after Health and Human Services posted on X late yesterday afternoon that Monero's was no longer CDC director. She'd been in that position less than a month. The Washington Post is reporting Moneris had faced pressure to change CDC vaccine policy. Earlier yesterday, the FDA approved the next round of COVID-19 shots for the fall, but only for a smaller, high-risk group of people. Obviously, this has implications for vaccine approvals. It has implications for insurance.

2:50Obviously, this is the latest string of firings we've seen over the last few weeks. I was going to say implications for pressure on various appointees and something we'll definitely be discussing throughout the day. Joining us right now is former Obama administration health policy director, Dr. Kavita Patel. She's a primary care physician, also an NBC News and MSNBC contributor. Good morning to you. You know, we keep having these scenarios where somebody is getting fired by the administration and then saying that they're being unjustly fired. I'm curious, as you're watching this out, because this is playing out in your world.

3:22What was your what's your initial impression? What do you think has to happen before we even get into the implications of all this? Yeah, I do think that, Andrew, there are a couple of things to keep in mind. This is actually a pretty historic CDC director because the first ever Senate confirmed CDC director previously didn't require Senate confirmations. It didn't have to go through that process. That means that she got support from Republican senators, had to do the testimonials in front of Congress, the whole nine yards, which is just an additional hurdle, but also creates It's a little bit, I think, of what came as a groundswell of support from both the public health community and bipartisan politics, which is not necessarily easy to do.

3:58So I do think that that's important for the context. That and keep in mind that we've got August 8th, a tragedy that struck the CDC on her watch, meaning not her fault, obviously, but certainly something she had to deal with just weeks into her tenure, a shooting at the Atlanta campus that's still resonating and reverberating for the staff. So I do think that backdrop, Andrew, is important because it's a unicorn event. these things that could only happen on top of what you just mentioned about other Trump officials. Dr. Patel, let's talk then about the implications as you see them from a health perspective.

4:29Obviously, we're walking into the fall. You know, lots of folks hopefully taking the flu vaccine. I know there's a question about taking the covid vaccine and everything else. Right. Yeah. So let's talk about the public health implications. Yesterday was also significant. And obviously, these are not coincidences. But yesterday, we saw the FDA change the label on the COVID vaccine to be pretty restrictive, to basically say that if you're not 65 or older, you must have a high-risk condition. How that gets enforced, what happens on the ground in my clinic and in pharmacies, that's, I think, left up to all of us.

5:04But the CDC is going to bring their advisory committee, which was, by the way, mostly 99 % replaced by RFK Jr., by the secretary. they're going to meet in September, which is actually unusual to be so late because guess what? We're already seeing a spike in COVID cases and we're seeing the season hitting us as we would expect a respiratory season that's hitting us right now. So implications are confusion, people not understanding what and exactly what they should receive. Meanwhile, you've got major and prominent medical organization, American Academy of Pediatrics, American College of Obstetrics and Gynecology, and others that I assume will follow quickly making different recommendations than what's come out from the FDA label and what stands as CDC language today.

5:45So that'll create confusion when you're walking into your retail pharmacist or into your doctor's office. And we'll have to kind of spend time to figure that out. Well, that's my question to you, which is what do you recommend to those who are watching right now as it relates to these issues? And also, you know, I was actually speaking to a doctor about this a couple of months ago when we were talking just about CDC language and everything else, about whether it creates any kind of liability for doctors who ultimately recommend against what the government recommends. Right. So let me handle the first one first.

6:17What's happening right now? So I am telling patients what we have today. Most of us in our clinics are waiting for the new shipment of the revised COVID vaccine. And we haven't gotten, Andrew, in the DMV, the Maryland area, we haven't gotten our updated flu shots yet. So we're waiting for those where we're on order and we should get them imminently. But you can walk into a retail pharmacy if they have the supply and get the older version of the COVID vaccine. I know that there are a lot of people, myself included, traveling, school starting. We just want to take that precaution. I think that's completely reasonable to go ahead and do.

6:50And then what I'll say is that because of this FDA and label changes at September CDC meeting, there could be an insurance change where you might not have coverage. Medicare and Medicaid usually follow immediately following that September meeting, but most private insurers will change coverage, if they do, in January 1st of 26th. So you do have these months to wait for the updated vaccine. So I've given people a couple of choices. Flu shots, I resoundingly recommend. And then we've got RSV season. I want to make sure that people are eligible for that. 50 it up. Also get the RSV shot if they can be eligible.

7:22And the pneumonia shot. So that's a lot of shots, Andrew, but we have to kind of walk through that for people. Second to your liability point, that's just blatantly not true. I've got malpractice coverage. This is something that their implication was that if we go off label from what the FDA has and that we recommend a vaccine, that somehow we will have this immediate trigger or potential trigger on liability. I think as long as you go through the informed consent, which is what all of us do for vaccines, should be doing, that we do not have to worry about that liability coverage. What does come up for liability, though, and it hasn't been spoken about, is a little bit of a different permutation.

7:55There's a vaccine injury coverage Protection Program put in by the federal government for vaccine injuries, there's a chance that may not cover you if you receive the vaccine outside or off-label from FDA, CDC guidance. So there are serious implications here, and I don't want to minimize them. But there's more confusion about everything from the top, because if you go to a government website, I'm not sure that you can trust the clinical information they're recommending. And I think yesterday's departure of not just the CDC director, but other staff confirmed that. So then how quickly do you think this void can be filled at the CDC?

8:32Senator Bill Cassidy, who is a Republican from Louisiana, said that CDC's high level departures will require oversight by the Senate Health Committee that he runs. What do you think he means by that? And, you know, how unprecedented is is that type of Senate oversight over the CDC? Yeah, Leslie. So, you know, I'm getting old. My job before I worked in the Obama administration was the staff director for that very committee under Ted Kennedy. So I know exactly what the senator is talking about. We had oversight staff. We conducted oversight hearings. We conducted investigations on an ongoing basis.

9:05That's what he's referencing. I think that is the bare minimum. Let me just say I can authoritatively tell you that that's the bare minimum of what a committee can do. a committee can actually advance. And because this is a Senate-confirmed position, a committee can actually advance, and the senator himself could advance a slate of nominees. We did that on a regular basis. The White House doesn't have to take them up, but putting out a daily call for replacements, giving names, asking for answers, not just through oversight hearings, but you can imagine having actual daily roundtables. It doesn't even need to be hearings.

9:38Roundtables. I just want to point out that R.K. Jr., the secretary, is due to testify in front of the Senate Finance Committee September 4th. We'll see if that happens. That might be the first chance that we get to kind of hear from the administration about this. Okay. Dr. Patel, I want to thank you. This is fascinating. Fascinating and lots of things to think about this morning. Cheese will be next. Next on Squawk Pod, Facebook co-founder Chris Hughes is now co-chair of the Economic Security Project, and he's giving a warning about threats to the Fed's independence. It seems pretty clear that this firing is illegal.

10:16And I think markets expect that there'll be a preliminary injunction at the district court level and that the Supreme Court will hold it up.

10:34This is Squawk Pod. You're watching Squawk Box right here on CNBC. I'm Andrew Ross Sorkin, along with Leslie Picker and Wilford Frost in for Becky and Joe on these final two days of August. Sales of Tesla vehicles in Europe plunging in July. The European Automobile Manufacturers Association saying the company's new car registrations totaled just 8 ,800 last month, down 40 percent year over year. It was Tesla's seventh consecutive month of European sales declines, even as the industry data showed overall sales of battery electric cars rose. China's BYD saw a 225 % surge in new European registrations in the same time period.

11:18So BYD clearly picking up a lot of share and then some, it seems like, from Tesla. You're on the ground in the region, so you see these things firsthand. Yeah, and you're really suddenly seeing more of them, particularly for like Ubers as well. And I think you get much lower tax in London if you're an electric vehicle as well. So you're seeing a lot of increase in that sense. And the price point for BYD relative to Tesla in Europe is like tens of thousands of dollars. Yeah, Tesla's like comparable to, you know, buying a top-end Mercedes or a top-end, you know, other electric vehicle car. So, yeah, the prices are wildly different.

11:58I actually think the EU has a higher tariff than the UK does on BYD cars, on Chinese automakers. But it's not as high as the US automakers is on those cars. And guys, I'll just bring it back. Is your sense, though, that these vehicles are so good? I mean, the thing that everybody talks about in the US is that maybe our cars, even though we like to think we've got great cars, will never catch up or be as good as the vehicles coming out of China. Definitely. I mean, I've never driven one, but I've sat in the back of them. And, you know, in terms of a functional car for the price, it's off the scale.

12:32And I think, you know, that's the other point. We touched on this a little bit yesterday about does the policy of containment, whether it's on chips or autos work. And we're in a crucial different position now when when these European countries, UK or EU, are facing a combative U.S. administration. Again, you can say this is right or wrong. You know, they are more likely today, as much as the U.S. is amping up its clashes with China, more likely to allow these Chinese made products in because they're questioning whether they can rely on the U.S. in that sense. And again, just the quality of the price is really quite impressive.

13:11The UK is in a slightly different position to the rest of the EU because, alas, our auto industry is much diminished from where it was decades ago. And it's much more focused on the very high end. So that's Jaguar Land Rover. It's Aston Martin. Even though Bentley and Rolls-Royce are now owned by German automakers, they're made in the UK. So letting in cheap foreign EVs isn't as much of a political threat as it is certainly in the U.S. or in Europe, where you've got a lot more Peugeot, Citroën and all the German automakers. Yeah, you're not taking an Aston Martin Uber in Europe. Although I think they should introduce that, the 007 Uber.

13:54Ooh. Be quite nice. Five stars. Yeah, five star review. What kind of premium would you pay for that? I mean, if it's James Bond branded, you could have me pretty easily.

14:07Our next guest, sounding the alarm, this is now months ago, on the dangers of the Trump administration, attacks on the Fed. Joining us right now is Facebook co-founder Chris Hughes. He is co-chair of the Economic Security Project and author of the book Market Crafters. It was published in April, which covers how the Fed has shaped markets over the last century. His April New York Times op-ed warned that the president's attack on the central Bank undermined Fed independence. And we want to get into all of it. Crystal, I want to start with this. You know, I think that when I last saw you and I, you know, I read the book and was reading these op-eds, there was a feeling that if the if the independence of the Fed was genuinely challenged, that the markets would react, that the bond market would react, perhaps the equity market would react, that that would be the governor to some extent on any challenge to the Fed's independence.

14:57And yet, for whatever reason, and this is I'm curious what you think the reason is, We have not seen that. That was the hope. But I think it's true that the markets reflect the conventional wisdom. And right now, I think the conventional wisdom is that Trump's team is a lot of talk and not a lot of substance, first off. And then secondly, it seems pretty clear that this firing is illegal. And I think markets expect that there'll be a preliminary injunction at the district court level and that the Supreme Court will hold it up. And perhaps there's even one more reason for market optimism, which I don't necessarily share, but that's the idea that the administration is recognizing that they can only fire a governor for cause.

15:37I mean, back in April, we were all worried that they could just fire governors just like they'd done at the FTC and elsewhere. Now, I think that the reality is that this is the most aggressive assault on Fed independence that we have ever seen. I'm a historian of the institution, and there's been all kinds of jawboning, all kinds of threats, even leaks from the president to smear the chair. This is in a totally different league, and I think that we should all be significantly more concerned than the markets seem to be. Chris, here's the question, though. If, in fact, Lisa Cook did something that was illegal or even immoral, does she have an obligation to step down on her own?

16:15Putting aside whatever you think the president is doing, could we hold both ideas in our head, which is to say you could argue that this is a weaponization and a challenge against the independence of the Fed in terms of how this is being orchestrated. At the same time, there have been members of the Fed board that have stepped down for doing things that may not have even been illegal, but raised questions and eyebrows. and for the credibility of the Fed, there was an argument to be made that they needed to step away. Not for a paperwork error that was made five years ago that has nothing to do with how she's executed her time on the job.

16:53Listen, we know exactly what happened here. The president made threats for the chair. They didn't really work. So then it seems that he asked folks in his administration to go find some dirt on governors. They found a paperwork error, which seems important and something that needs to be rectified. However, it does not go in any way to Lisa Cook's ability to be a governor of the Federal Reserve and to execute her responsibilities effectively. You've got to tell me that people like Scott Besson, Howard Lutnick, these are very wealthy folks who have reams of complicated tax returns and mortgages.

17:28These guys have never made any error in any of that paperwork ever. This is an attempt to find some dirt and then to aggressively prosecute a case. and Lisa Cook should say, no, this is not for cause and I won't step down. A paperwork error, if that's what it is, is different from intentionally misleading something, though. I mean, I guess if that is indeed what happened, do you think she'll come out and publicly clarify that before too long? And if she does, do you think this will go away or not? She should. I mean, for this to actually be mortgage fraud, which is the term that the administration is using.

18:03You have to have the intent to defraud. And I suppose it's theoretically possible that that's true, but it seems very unlikely. I've talked to a lot of folks in Democratic and some Republican administrations who have made similar errors, you know, even marking a residence as a principal residence, moving to D.C. to work, renting it out, and not changing the designation on the form. So, you know, the idea that she was, you know, trying to falsify documentation seems to me to be fabricated. And it's part of this pattern of finding these errors in order to prosecute a case that is really quite thin.

18:42And I think the courts will see that. Chris, I want to ask you this then. Go ahead, Andrew. Go ahead, Will. No, go ahead, Will. It's not on the Fed. I just wanted to move on the debate a little bit. So maybe we'll finish back up there with Andrew. But a topic we were discussing yesterday, Chris, I'm interested in your take on this stems from this very sad case. But the question at hand is whether or not the next decade will see the big tech players that dominate the AI names be classed as publishers in legal frameworks or indeed just common discourse in a way that obviously Facebook and other social media platforms weren't.

19:18Because a machine that they own and developed are telling you things, are the owners of that machine responsible for the content? They are. And they seem to know that. So there's the law Section 230, which many of your viewers, I'm sure, have heard of, passed back 25-plus years ago in the late 90s, which says that if you are a platform, you're not responsible for the stuff that people post on your platform. In other words, that's not original content that you are responsible for. That's something that those folks posting it post for. And that gives blanket immunity. Unprecedented. It doesn't exist in any other industry to companies like Facebook and Google.

19:54Now, it's been questioned in the courts in recent years, but so far that still holds. However, for the AI models, because it is original content, each time that they give you an answer, they are formulating an original novel one. That's the whole idea, that they're not giving you the same web page that they would give to anyone else. They are liable for that information. And it seems so far that the models are being trained because the companies realize that they have that liability and don't want to tell people how to build a bomb, let alone, you know, create photos of a teenager that could be circulated for, you know, cyber harassment and bullying.

20:30And so I think it goes to attestment to the fact that Section 230 should no longer be the law of the land, even for the social media companies, and, you know, should be repealed in general overall. I just wanted to ask you one more time, and I'm sorry for the ping pong on the different topics. But on the Fed, there's one topic that people are talking about. The idea of and you know the history of the Fed, the idea that if you could get a quote unquote majority of the Fed in almost a political way, the way the president has described that come February, all of the Fed presidents need to be quote unquote re-nominated.

21:05And whether you think that that entire process could get upended. The short answer is it depends on the level of integrity of Governor Waller and Governor Bowman. So Waller speaking today. So I think we'll all be watching those remarks. But in theory, it is true. On years that end with a one or a six, all of the Reserve Bank presidents have to be their terms expire and they need to be reappointed as, you know, the monetary policy body at the Fed is the FOMC, 12 different votes, five of whom are Reserve Bank presidents. So in theory, if the president got control of the core group of seven, got a majority there, it could decide not to reappoint all reserve bank presidents and effectively say to the reserve bank boards, only bring us candidates who are going to be deferential to the administration.

21:52That could happen. Now, to get to four of seven, you'd have to have Chris Waller and Michelle Bowman, the two current governors who tilt towards a looser monetary policy, agree with that. And I think that these folks have spent much of their lives dedicated to this institution. So I think that's unlikely, but it is possible. Chris Hughes, we could talk to you, as I said, for a very long time about so many different topics. We appreciate you joining us this morning. Thank you. Thanks for having me. We'll be right back.

22:25That's the podcast for today. Thank you for tuning in. Squawk Box is hosted by Joe Kernan, Becky Quick, and Andrew Ross Sorkin. weekday mornings on CNBC from 6 a.m. to 9 Eastern. To get the smartest takes from that TV show right into your ear, you can follow us here on Squawk Pod wherever you're listening now. We'll meet you right back here tomorrow. Have a great day. We are clear. Thanks, guys.