Inflation Report Beats Expectations, Dems Face Shutdown Pressure, Trump Warns Russia： AM Update 3⧸13
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Summary
The White House touts better than expected inflation numbers as markets shake in anticipation of further tariffs. President Trump signals he s ready to inflict economic pain on the Russians as Kremlin officials react coldly to calls for a ceasefire. All that and more coming up in just a moment on your AM Update.
Transcript
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Good morning, everyone. I'm Megan Kelly. It's Thursday, March 13th, 2025, and this is your AM
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Update. I think the markets are going to soar. There's tremendous optimism out there. The White
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House touting better than expected inflation numbers as markets shake in anticipation of
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further tariffs. And I think that's one of our core responsibilities in the Senate or in the
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government here to ever allow the government to shut down. Despite earlier tough talk, some Democrats
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balk at the prospect of a government shutdown. President Trump suggests he's ready to inflict
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economic pain on the Russians as Kremlin officials react coldly to calls for a ceasefire. All that
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and more coming up in just a moment on your AM Update. You don't go out and buy a light jacket
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Some good economic news for President Trump. The inflation rate declined more than expected in
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February, coming in at 2.8 percent, down from 3.0 in January. The core inflation rate, which excludes
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more volatile items like food and energy, also cooled to 3.1 percent, down from 3.2. Both figures coming in
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lower than analysts had predicted. The Federal Reserve's target rate for inflation is 2 percent.
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GasBuddy reporting the average price of gas dropping for the third straight week, now at $3.03
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per gallon. That's the lowest average price for gasoline in the month of March since 2021.
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President Trump reacting positively to the news from the White House.
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I think the markets are going to soar. There's tremendous optimism out there about our country
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in terms of regulations being cut, in terms of taxes being cut. Oil is down to $65 a barrel,
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and that's faster than I would have. We put on the gas, we stepped in the gas in order to get oil.
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A key piece of the Trump administration's economic plan, unlocking oil production. On his first day in
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office, Mr. Trump signing orders increasing oil and gas drilling on public lands and offshore areas,
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reversing previous restrictions. Some additional context, putting the new economic numbers in
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perspective. The only tariffs in place in February were the initial 10 percent duties on Chinese imports.
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Wednesday markets swinging wildly. The S&P 500 and Nasdaq ultimately rising as investors weigh a
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solid inflation report with anticipation of more expected tariff increases.
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President Trump, seated next to Irish Prime Minister Michal Martin in the Oval Office,
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again signaling his trade war is just getting started.
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The EU was set up in order to take advantage of the United States.
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Including Ireland? Is Ireland taking advantage of the U.S.?
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Of course they are. We had leaders that didn't have a clue. Or let's say they weren't business
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people, but they didn't have a clue what was happening. And all of a sudden, Ireland has,
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you know, our pharmaceutical companies. When the pharmaceutical companies started to go to
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Ireland, I would have said, that's okay if you want to go to Ireland. I think it's great. But
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if you want to sell anything into the United States, I'm going to put a 200 percent tariff on you.
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So you're never going to be able to sell anything into the United States. You know what they would
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have done? They would have stayed here. Next week, the Federal Reserve is set to announce a decision
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on interest rates. While President Trump has repeatedly called for the rates to be lowered,
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the Fed operates independently from the government. Last Friday, Fed Chair Jerome Powell saying they're
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in no hurry to make any adjustments, suggesting interest rates are likely to stay in their current
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range, 4.25 to 4.5 percent. A new CNN poll shows Americans may be souring on the tariff wars,
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61 percent of Americans disapproving of the use of tariffs compared to 39 percent who approve.
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Overall, on the economy, 56 percent say they disapprove versus 44 percent approving,
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worse than at any point during President Trump's first term in office.
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The government shutdown deadline ticking even closer now as the Senate weighs this six-month
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funding extension. The bill requires 60 votes to pass in the Senate, meaning some Democrat support
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is required. In the lead-up to the House vote on Tuesday, Senate Dems talking tough, calling the
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bill horrible, and a power grab by President Trump and Elon Musk. Now, with the possibility of forcing
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a shutdown in their hands, some Dems are balking. We don't agree with what's been sent to us,
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but, you know, if we withhold our votes, that is going to shut the government down. And I think that's
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one of our core responsibilities in the Senate or in the government here to ever allow the government
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to shut down. We could wind up in a situation where maybe this administration decides to leave
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parts of the government that provide valuable services to the American people closed permanently.
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Pennsylvania Senator John Fetterman telling reporters he will vote yes. The Hill reporting
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one unnamed Senate Democrat saying, quote, I can't say we have a strategy. There are a lot of people
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who haven't made a decision. Independent Senator from Maine, Angus King, who typically votes with
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the Democrats, telling the Washington Post, quote, it's a choice between two terrible alternatives.
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Some Dems are worried a shutdown will backfire on them, allowing the Doge team to permanently shutter
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even more of the government. In a shutdown, non-essential employees are furloughed and essential
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employees continue working. The Post reporting some Dems argue a shutdown could allow Doge to more
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easily cut the employees deemed non-essential. Democrat Senator from Virginia, Tim Kaine,
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leaving his options open, telling Politico he would like some amendments added to this bill.
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However, any additional amendments would need to be approved by the House, which is not likely to
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agree on anything that increases government spending. The deadline is 11.59 p.m. on Friday.
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Senate Majority Leader Chuck Schumer saying his party is united, which is not true,
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and that right now the GOP does not have the votes to avoid a shutdown.
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Coming up, U.S. diplomats bringing an offer of peace to the Kremlin as President Trump suggests
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a willingness to ratchet up pressure on the Russians and the Department of Education slashed
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by a whopping 50 percent. Which programs stay and which ones go? All that and more in just a moment.
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Russia's military advances in Ukraine as the U.S. sends an envoy to the Kremlin to pursue
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a ceasefire. The Russian army is close to surrounding 10,000 Ukrainian troops in the Kursk
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region of Russia. Ukraine captured this bit of Russian territory last August, once floating the
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idea of exchanging it back for captured Ukrainian territory. Most of it, however, has been regained
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by Russia, but not all. In recent days, the Ukrainian hold on the area falling into serious jeopardy,
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with Russian President Vladimir Putin on Wednesday telling his forces any captured Ukrainian soldiers
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in Kursk will be treated as terrorists. As the battlefield erupts in chaos, peace negotiators
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diligently strive to broker a ceasefire. President Trump and Vice President J.D. Vance expressing
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cautious optimism on the next stages of ending the war.
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We've got some conversations that are happening on the phone and in person with some of our
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representatives over the next couple of days. As the president said, we think that we're in a very
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good place where the Ukrainians have agreed to a ceasefire, and we're now going to see whether we
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can get the Russians to agree to a ceasefire too. We haven't spoken to him yet with substance because
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we just found out and we just were able to get Ukraine to agree, so we're going to know very soon.
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I've gotten some positive messages, but a positive message means nothing. This is a very serious
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situation. Secretary of State Marco Rubio plainly laying out the stakes for both sides.
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There is no military solution to this conflict. Neither side can militarily achieve their maximalist
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gains, their maximalist goals. Neither side can achieve them through the military side.
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The only way this conflict can end is through negotiation. That's the only way you're going
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to have peace. Special Envoy Steve Witkoff is traveling to Russia for in-person negotiations.
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In advance of his arrival, Kremlin officials responding coldly to the Ukrainian acceptance of a
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ceasefire. The Guardian reporting a Russian foreign ministry spokesperson as saying, quote,
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Moscow will make its own decisions about the war and not follow the lead set by Washington and Kyiv.
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Mr. Lavrov adding, quote, it is impossible to rely on the goodwill of opponents who have declared the
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goal of inflicting strategic defeat on Russia. Despite earlier Western criticism that President Trump was
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too lenient on Russia in negotiations, Mr. Trump now signaling a willingness to apply plenty of pressure,
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There are things you could do that wouldn't be pleasant in a financial sense. I can do things
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financially that would be very bad for Russia. I don't want to do that because I want to get peace.
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But in a financial sense, yeah, we could do things very bad for Russia. It would be devastating for
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President Trump taking the most dramatic action yet to put an end to the Department of Education,
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slashing its workforce by 50 percent. The move marking a significant escalation in his longstanding
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push to reduce the federal government's size and specifically its role in education. The department
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enshrined in a law by Congress would require an act of Congress to be fully abolished. But with a divided
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legislature, that battle could take years. In the meantime, Education Secretary Linda McMahon telling Fox
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exactly what was cut and what stays, at least for now.
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We wanted to make sure that we kept all of the right people, the good people, to make sure that the
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outward-facing programs, the grants, the appropriations that come from Congress, all of that are being met.
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And none of that's going to fall through the cracks.
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Congress appropriates the money that is going through Title I, through IDEA programs.
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Well, do you know what? I'm not sure I can tell you exactly what it stands for,
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except that it's the programs for disabled and needs.
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The administration insisting essential, congressionally mandated funding remains intact.
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Heads of the teachers' unions arguing the cuts are an attack on public education.
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It's a disaster symbolically as much as it's a disaster in reality.
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Think about a country whose president basically says, as their first acts, I'm getting rid of education.
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This administration is focused on destroying public education.
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Since the inception of the Department of Education in 1979, spending on public education has skyrocketed.
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U.S. public schools spend an average of more than $16,000 per student each year,
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In that same time, overall, test scores have shown little to zero improvement.
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President Trump telling reporters the education department is the easiest to make cuts from.
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But now the Department of Education, maybe more so than any other place, has a lot of people that can be cut.
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And if you look at the charts, because they have numerous charts where they do the top 40,
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And recently they hit, during Biden's last few days, they hit last.
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So they were number 40, and yet we're number one in cost per pupil.
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We're going to move the Department of Education, we're going to move education into the states,
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so that the states, instead of bureaucrats working in Washington,
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The Trump administration aims to restructure education funding,
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focusing on block grants that would allow states more freedom to choose how to educate their students.
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Former Columbia University student agitator Mahmoud Khalil remains in a Louisiana ICE detention facility today.
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Mr. Khalil did not attend Wednesday's packed courthouse hearing,
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the first step in his court battle to prevent deportation.
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Khalil filed his challenge in the Southern District of New York.
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Government officials requesting a change of venue,
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arguing that the SDNY is not the appropriate jurisdiction.
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Federal prosecutors urging the judge to move the trial to New Jersey,
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or to Louisiana, where he is currently being held.
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Khalil was a prominent organizer of the Columbia University protests last year,
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that led to clashes with police and more than 100 arrests.
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Students established a Gaza solidarity encampment on campus,
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often chanting anti-Israel, anti-Semitic slogans,
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and blocking Jewish students' access to campus spaces.
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The group Mr. Khalil represented as a master's degree candidate,
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reportedly sympathizes with terrorist groups Hamas and Hezbollah,
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and seeks the, quote, end of Western civilization.
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Mr. Khalil's attorney saying in a statement their client was, quote,
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chosen as an example to stifle entirely lawful dissent in violation of the First Amendment.
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Secretary of State Marco Rubio, who oversees green card allocation, responding on Wednesday.
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No one has a right to a green card, by the way.
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So when you apply for a student visa, or any visa to enter the United States,
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we have a right to deny you for virtually any reason.
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But I think being a supporter of Hamas, and coming into our universities,
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and turning them upside down, and being complicit,
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complicit in shutting down learning institutions.
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There are kids at these schools that can't go to class.
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You're afraid to go to class, because these lunatics are running around
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with covers on their face, screaming terrifying things.
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If you told us that's what you intended to do when you came to America,
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Mr. Khalil's lawyers are expected to file an updated version of their petition later today.
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Join me back here all week for our special series,
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It will air on SiriusXM Triumph Channel 111 at noon east,
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and all podcast platforms on the Megan Kelly Show feed.