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Fiscal Cliff Face-Off; Interview with Senator Ron Johnson; Chemical Weapons Fears In Syria

Aired December 4, 2012 - 08:00   ET


SOLEDAD O'BRIEN, CNN ANCHOR: Good morning. Welcome, everybody. Ron Brownstein joins us this morning. He is the CNN senior political analyst, editorial director for "National Journal." Bob Shrum is with us. He is a Democratic strategist. Will Cain is with us. He is a CNN contributor and columnist for the

Zoraida is sticking around with us as well from "EARLY START." Our STARTING POINT this morning is really about the frustration and more finger pointing now about this fiscal cliff.

Twenty eight days remain before drastic tax hikes and spending cuts take effect. Republicans are offering a plan that calls for $2.2 trillion in deficit savings over the next decade, including $800 billion in tax reforms, $600 billion from Medicare reforms or health spending reforms, and $600 billion in spending cuts.

Brianna Keilar is live from Washington, D.C. for us this morning.

Brianna, within -- really I think just hours, the White House said no go to this. Why so fast?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: Yes, very quickly -- well, because they want Republicans to capitulate on increasing those tax rates for wealthier Americans. In fact, the logjam continuing as the White House is insistent that it won't talk to Republicans about details of entitlement reform, which Republicans want, until they cave on those income tax rates. And as of right now, Republicans aren't budging.

The White House, congressional Democrats -- they feel confident in their position because they point to polls that show the vast majority of Americans say he when talking about how to raise revenue, that they think increasing those rates should be part of that. But in the meantime, it's really just the blame game. Take a listen.


JAY CARNEY, WHITE HOUSE PRESS SECRETARY: Making vague promises about achieving revenue through capping deductions or closing loopholes simply doesn't add up to a serious proposal.

SEN. TOM COBURN (R), OKLAHOMA: I'm certain that if this is not good enough for the White House, we will go over the fiscal cliff. This is a compromise on taxes. (END VIDEO CLIP)

KEILAR: Now, as soon as Speaker Boehner's counteroffer came out, the White House communications director responded, saying this is nothing new, saying it lacks specifics.

But I will tell you, sort of behind the scenes, there was a Democratic leadership aid that told CNN that actually, Soledad -- this may surprise you -- that the offer passed the laugh test. It does have some of the things that were in the grand bargain, that failed grand bargain worked out between -- where President Obama and Speaker Boehner tried to work out last year.

And also -- while certainly both sides are saying that specifics are lacking, there is certainly, I think, a feeling from some Democrats that maybe it could have been worse. Maybe they were expecting something that in their estimation might have been even more towards what Republicans would want.

O'BRIEN: Brianna Keilar -- thank you, Brianna.

I guess we're supposed to be encouraged that everybody wasn't just giggling over the proposals. I know the Republicans said they laughed at the White House proposal.

Let's get right to Senator Ron Johnson. He's a Republican from Wisconsin. He's a member of the Budget Committee and the Appropriations Committee.

Nice to have you with us, sir. We appreciate your time this morning.

SEN. RON JOHNSON (R), WISCONSIN: Good morning, Soledad.

O'BRIEN: You heard Brianna's report a moment ago. She said the White House rejected it because they're like, listen, it has to have tax increase on the top 2 percent or it's a complete no go. Would you be willing, in fact, to raise taxes on the top 2 percent wealthiest Americans?

JOHNSON: Well, Soledad, where I'm on this morning is to make the case for growth and how it's 10 times more effective than just increasing tax rates. Quickly -- few numbers, you know, I like numbers.

O'BRIEN: Yes, you do, sir.

JOHNSON: Even in this meager economic recovery we've had since 2009, revenue has increased by $344 billion per year. If we've just return to a normal economy like we had in 2007, when we had the same tax rates we're talking about now that we're experiencing now, when federal revenue was 18.5 percent of our economy, that would add another $400 billion of revenue per year. So, total add it all up, it's about $750 billion of added revenue through economic growth.

Now, the President's proposal, let's just kind of round it up, because you hear different figures out there. Let's say about $75 billion per year. It's a tenth of what you get with economic growth. And the problem with that, Soledad, is by punishing success -- which is really what you're doing here -- you put at risk that economic growth that's ten times as more effective.

O'BRIEN: OK. You know, sir, if you go out and poll Americans, right, they'll say, yes, wealthier people should pay. Isn't that kind of tenuous, challenging position for a Republican to be in? To go against what has been shown consistently, polls in the 60 percent, 70 percent area when you ask people should you tax that top 2 percent, most people say, yes, you should. They should pay more money.

JOHNSON: Yes, Soledad, I would imagine 98 percent of the American public --

O'BRIEN: Yes, I believe that's --


JOHNSON: Because we haven't made the case for economic growth. The American people don't really understand that economic growth is 10 times more effective. I think those numbers we just talked about proved it.

You know, we shouldn't be playing brinksmanship and we wouldn't be if Democrats in the Senate had passed a budget over the last three years. I mean, that's really what we need to see is what is the President's plan?


JOHNSON: Let's talk about the $75 billion.

O'BRIEN: Let's talk about economic growth. Can we back up?

BOB SHRUM, DEMOCRATIC STRATEGIST: The economic growth thing is --

O'BRIEN: So, hold on a second, Senator.

SHRUM: Under Bill Clinton, we had taxes at 39.6 percent. We created 22 million new jobs. We cut them under George Bush. We had almost no net job creation. Why do you keep making the argument cut low taxes for the richest people in the country are the key to job creation when history refutes that?

O'BREIN: Go ahead, Senator.

JOHNSON: We could go do a history lesson, but I would argue that Clinton's economic recovery really dates back to Ronald Reagan, when he cut rates to -- listen, I started my business in the '80s. So did Apple. So did Microsoft. Those businesses came to fruition in the '90s and President Clinton, together with the peace dividend, also produce by Ronald Reagan, that's what created that economic engine.

But I'll tell you what? Let's take a look at just the Bush tax cuts. In 2003, federal revenue was a little under $1.8 trillion when those Bush tax cuts were enacted. Four years later, in 2007, revenue had risen to $2.5 trillion. That's a 44 percent increase through economic growth.

It actually works. And this president simply doesn't understand that. So, as a result, he's going to punish success. We're going to put at risk the economic growth that we really need to create the jobs, create taxpayers, to create the revenue we need to lower our deficit.

O'BRIEN: So, let me play a little chunk of what Congressman Becerra said to me just a few minutes ago.


REP. XAVIER BECERRA (D-CA), CHAIR, HOUSE DEMOCRATIC CAUCUS: Elections have consequences. And the President ran his campaign for two years, saying he was going to let the Bush tax cuts for the wealthiest 2 percent expire. He was very clear about that.

For Republicans to do everything possible, to shield the millionaires and billionaires from that tax increase is the reason we're still stuck. The moment they let go of that, we have a deal.


O'BRIEN: So, he says the moment you let go of that 2 percent, you have a deal. If that were the case, if the moment you let go, you have a deal, are you standing in the way of a deal? Are you potentially sending America over the fiscal cliff, 9.1 percent unemployment all the other bad things, millions of people lose their jobs, for protecting -- dogs and cats live together because of this 2 percent? If at the 2 percent, you have a deal, why not give him the 2 percent?

JOHNSON: What's the deal? I get the 2 percent. I realize that may raise $75 billion the first year, which is 7 percent of our thousand $1.090 trillion deficit.

What's the solution for the other 93 percent? That's what Republicans are talking about.

Listen, this president has put forward four budgets. He has yet to propose a solution to save either Social Security or Medicare. His last two budgets so unserious, in three votes in Congress, they've garnered zero votes from even members of his own party. Democrats haven't passed a budget in three years.

If you actually want to have a deal, put something on the table that the American people can actually evaluate. I am tired of these secret negotiations where the financial future of America is going to be determined by what, one or two individuals and their staffs? This should be --


JOHNSON: -- a very open process that is debated by elected officials, members of Congress, congresspersons and senators. That's how this process should work. But Democrats in the Senate have refused to follow the regular order, and actually putting even one vote to a budget. That's where we have to start.

CAIN: Senator Johnson, this is Will Cain. You said, OK, fine. I'll give you the 2 percent. How are you going to solve the 93 percent? What could they come back with, with spending cuts, that would satisfy you, to make you fulfill that promise you just said to give the 2 percent? What kind of spending cuts are you going to require? Give us a number.

JOHNSON: First of all, I didn't concede the 2 percent because growth would be better. Before I would even consider it, I would want to see their full plan.

You know, Republicans have full plans. Two House passed budgets that included a solution to save Medicare that was used against us in the election. Republicans have proven to be willing to be held accountable. Democrats have not.

I mean, can you explain why one Democratic senator hasn't put his vote to a budget proposal? That's key.


O'BRIEN: And I give you that. I want you to answer Will's question, which is a great question. List for me --

JOHNSON: Oh, sure.

O'BRIEN: We're low on specifics, really from both sides. Tick off for me the top three things that the Democrats should put on the table in terms of spending cuts that you would be cool with and would make you feel good about the 2 percent given?

JOHNSON: Let's acknowledge the primary driver of our debt and deficit is going to be health care costs.


JOHNSON: By the way, we've already got a trillion dollars of middle class -- middle income tax increases cooked in the books under Obamacare.

O'BRIEN: That's one, Obamacare. What's two?

JOHNSON: By the way, that is grossly underestimated in terms of cost. We have to address that.

We need structural reform for both Medicare and Social Security, structure reform, things that can't be taken away as soon as they're enacted, like the budget control. I mean, let's take a look at this. We actually -- we actually put some spending restraint in the Budget Control Act. And everybody is trying to get out from underneath that deal.

O'BRIEN: OK. So that's --


JOHNSON: We need structure reform.

O'BRIEN: And number three would be what? What would you cut?

JOHNSON: I'm not cutting anything. We are talking about restraining the growth of spending in these areas.

And then I would start looking at agencies. The other problem that is holding our economy back is the explosion of regulations. And I don't see we're going to reform these agencies. The way you reform them, you actually cut their budgets. That will force them to focus on the most important parts of the economy to have effective regulations.

So, I'd go after the agencies, put structure reform to save -- that's the important point, to save Social Security and Medicare. We've got to address this health care law, because it is a disaster.

Medical device manufacturers because of that 2.3 percent tax, they are moving overseas. We are going to crush innovation in this economy.

I'll tell you, another point I've got to make.

O'BRIEN: That's four.

JOHNSON: You want more?


JOHNSON: Listen --

O'BRIEN: I asked for three but I'll take four.

SHRUM: This is fantasy land like saying Ronald Reagan invented the Apple iPad. It's crazy. Obamacare will not be on the table.

O'BRIEN: I also imagine that cutting the budgets for some of those agencies will give you massive amounts of money? It contributes a lot to the budget, right?

JOHNSON: True, because discretionary spending is about $1 trillion. Our deficit is $1 trillion. And, Soledad, that's the problem.

Republicans have put forward budgets, voted for them, willing to be held accountable. Democrats have not. President Obama has not put forward a serious budget.

SHRUM: You won't vote for them.

JOHNSON: Nor have any Democrats.

SHRUM: Democrats have voted for those budgets and supported those budgets.

JOHNSON: Zero to 610 is the vote total of the last three votes on his last three budgets, 0-610. Do you think that's a serious proposal?

President Obama, show us your plan.

SHRUM: He can't show you a plan he gave you a plan. His plan is not to repeal Obamacare. Not going to happen. You lost the election, buddy.

O'BRIEN: We are out of time.

Senator Johnson --


O'BRIEN: We need to take Bob Shrum's coffee away, bring everybody back down.

We appreciate your time, Senator. I love you hashing the numbers with him. It's so interesting. He always comes ready to lay it out.


O'BRIEN: Well, I do think --

BROWNSTEIN: -- it is a very different world than he is laying out. Republicans won't consider raising the top rates, with all due respect, it's not your choice anymore. They are going up unless you make a deal that the President will accept. It is going to happen.

O'BRIEN: Believe it or not, there are some other stories in the world today that don't involve the fiscal cliff. That sounds like a shocker, but Zoraida has those for us.

ZORAIDA SAMBOLIN, CNN ANCHOR, "EARLY START": Yes, I'm going to bring that for you.

All right. Thank you, Soledad.

Iran has reported that it's captured a U.S. drone. But a defense official tells our Barbara Starr, quote, "The U.S. Navy has fully accounted for all unmanned air vehicles that are operating in the Middle East region." You are looking at video from state TV in Tehran released earlier this morning and it shows two Iranian revolutionary guard commanders examining what appears to be an intact ScanEagle drone.

The rain and flooding are relentless in northern California, four storms in less than a week. At least one death now attributed to those storms. The National Weather Service is forecasting showers in the area through tomorrow afternoon. But it's tapering off through the rest of the week.

So, there's a little good news for you folks out there.

And the head of the CDC warns all the signs are pointing to a bad flu season this year. CDC director, Dr. Thomas Frieden, is advising all Americans over the age of six months to get vaccinated. He said the flu arrived early this year but the vaccine is an excellent tool to fight it.

Soledad agrees with that.

O'BRIEN: Do you get the flu shot?


O'BRIEN: Do you get the flu shot?

SHRUM: Of course. It's irrational not to get a flu shot.

SAMBOLIN: All right. I may have to get one. It's irrational if I don't.

All right. Britain's Prince William is back with his wife in a London hospital this morning. Catherine, the duchess of Cambridge, is being treated for severe symptoms of morning sickness. Buckingham Palace announced yesterday that she is, indeed, pregnant. It is the announcement Britain has been waiting for, since Prince William married Kate Middleton last year.

CAIN: Odds on what baby's name will be, top name for a girl, Frances. Top name for a boy, John.


O'BRIEN: That's exciting. Exciting names there.

SHRUM: Do you know what happens if it's twins? The first one that comes out is the heir, the second one that comes out is the spare -- unless the first one that comes out is a girl and the second one that comes out is a boy, because the British have refused to change the rule that gives males precedence.

SAMBOLIN: They're working on that rule.

SHRUM: They're working on it, but --

SAMBOLIN: It may change.

SHRUM: I don't think the queen is going to let them move that fast.


O'BRIEN: They could grandfather it in. It would be interesting to see.

BROWNSTEIN: Grandbaby it in.

SHRUM: Grandbaby it in.


O'BRIEN: Still ahead on STARTING POINT, a red line on Syria. President Obama has got a stern warning for President Assad about using chemical weapons on his own people.

Pictures surface of this, George Zimmerman bloodied in the nose and mouth the night that Trayvon Martin was shot dead. Is it going to help his case?

You're watching STARTING POINT. We're back in just a moment.


O'BRIEN: New this morning, the head of NATO saying that if Syrian president, Bashar al Assad, were to use chemical weapons on his own people, it would provoke an immediate international response. President Obama also warning that there would be consequences. This is what the former British prime minister, Tony Blair, told me a little bit earlier on the show.


TONY BLAIR, FMR. BRITISH PRIME MINISTER: If there was any sense at all that Assad was going to use chemical weapons or did use chemical weapons against his own people, I would expect a very tough response that would be military.


O'BRIEN: Barbara Starr is with us. Not usually at the Pentagon, but today, here in person. If it seems that there is evidence that chemicals are being moved along with the war heads, is this an indication of new phase in Syria in some way?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, you know, it's interesting. The intelligence assessment back in Washington is just that that Assad is feeling the pressure. The fighting is intensifying around Damascus and that his own military commanders are giving him this option to try and achieve some rollback against rebel advances.

O'BRIEN: So, you know him and have studied him a lot. Would he do it? Would he put chemicals on --

STARR: Well, there's -- he would have to be convinced. The thinking is he's not yet convinced, that he knows he will face international outrage. And I think that's why you're seeing all these statements in the last 48 hours, don't do it, to push him to understand he cannot go down this route.

O'BRIEN: Barbara Starr for us. Thanks, Barbara. Appreciate it.

Still ahead this morning on STARTING POINT, could fashion icon and kind of notorious boss, Anna Wintour, be taking a job with the Obama administration? And what gig would it be? We've got details coming up.


O'BRIEN: Welcome back. Our "Tough Call" this morning, there's no evidence coming to light in the Trayvon Martin investigation. There's a picture, new in-color picture of second-degree murder suspect, George Zimmerman. It's been released by his attorney. It was reportedly taken by a police officer the night that Zimmerman shot and killed Trayvon Martin.

The picture, itself, is not new, but the fact that it's a high resolution color photo is. We've seen black and white versions. Big question, of course, is to what degree does this help George Zimmerman's case? Does it change the case?

BROWNSTEIN: You know, I mean, obviously, we're not -- you know, we're not in the legal process, so we don't know all the details. But, you know, I don't think it really tells you that much. It doesn't tell you at what point any injuries were sustained and what was going on when they were. So, clearly, there was an altercation. We all know that. I'm not sure where this heads be on that.

SHRUM: I'm a non-practicing lawyer. I can't tell you whether or not this helps or hurts.

O'BRIEN: I love the way lawyers, all of you, guys, the two of you who are lawyers, always do the denials first. I just want to say, this is not my client. Then you launch into - but if you see a guy's bloody face, that will help his case, right?

SHRUM: But it's absolutely right. There was some altercation. We know that. And the fact that he has a bloody lip probably doesn't justify killing somebody.

CAIN: But the question has always been that George Zimmerman reasonably act in self-defense or did he hunt down Trayvon Martin. And as you said, this does prove there was an altercation. It might shed light or might give evidence to some story of who was the aggressor at the time the killing took place.

O'BRIEN: And I would think, if you're the member of a jury, right, and you're looking at a now clean cut and cleaned up George Zimmerman and someone shows you a picture -- I don't think the wounds are devastating, but he certainly has been struck in around the mouth and nose.

SHRUM: We can't pre-guess what's going to happen in this trial. It doesn't necessarily prove he's the aggressor, that the other guy is the aggressor. He could have been the aggressor.

O'BRIEN: No, but I think there's going to be an impact on a juror.

BROWNSTEIN: Yes, we'll see.

O'BRIEN: Right? A color picture --

BROWNSTEIN: Like I said, we know there was an altercation, and this shows us that again.

O'BRIEN: You guys are never going to be good celebrity lawyers if you're not going to go out on a limb for me and make some good guesses on things. Still ahead on STARTING POINT this morning, young cancer patient missing from the hospital now, and her life depends on the police finding her. We'll tell you what happened, and the cops actually talked to her dad. That's coming up.

Plus, a fallen star from the baseball diamond manages to go even further. We'll tell you about Lenny Dystra. That's ahead. You're watching STARTING POINT. We're back in a moment.


O'BRIEN: Welcome back. You're watching STARTING POINT. Dozens of students were poisoned by carbon monoxide at their Atlanta Elementary School. There was no carbon monoxide detector even required at the school. In just a few moments, we're going to talk to a student, a parent, and Steve Smith, who's the deputy superintendent of the Atlanta schools.

First, though, Zoraida Sambolin has a look at some of the other stories that are making news today. Good morning, Z.

SAMBOLIN: Good morning to you, Soledad.


SAMBOLIN (voice-over): A desperate search by New York City police today for a man who allegedly pushed another man to his death right in front of a subway train. It happened in midtown. The two men apparently had some kind of argument on the subway platform yesterday prior to that fatal assault.

And the judge overseeing the court-martial of accused Ft. Hood shooter, Nidal Hasan, has been removed. A military appeal's court ruled the judge was a bias, and that move invalidates the judge's order that Hasan's beard be shaved. Hasan objected to that order with a number of appeals. He was citing religious freedom.

And the search for an 11-year-old leukemia patient who was mysteriously removed from a Phoenix hospital last week by her mother is intensifying this morning. Police have located Emily's father. He denies knowing anything about his daughter's whereabouts. Doctors say the young girl could die within days, they say. She has been receiving chemotherapy at Phoenix Children's Hospital for about a month and has a catheter in her heart that could become infected.

And a powerful typhoon has struck the Southern Philippines this morning, killing at least 27 people. That storm packed winds of 110 miles per hour. It destroyed homes and it triggered landslides. Officials say that millions of people could still be affected there.

And former New York Mets star, Lenny Dystra, sentenced to 6 1/2 months in federal custody. He pleaded guilty to three felony counts, bankruptcy fraud, concealment of assets, and money laundering. The former outfielder is already serving a three-year prison sentence in a separate case for grand theft auto. And Soledad says that's really sad.