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STARTING POINT WITH SOLEDAD O'BRIEN

Secretary of State Hillary Clinton Hospitalized; Fiscal Cliff Negotiations Continue; Interview with Grover Norquist

Aired December 31, 2012 - 07:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


(COMMERCIAL BREAK)

DR. SANJAY GUPTA, CNN SENIOR MEDICAL CORRESPONDENT: Good morning, our starting point this morning, Secretary of State Hillary Clinton hospitalized for a blood clot. The latest on her condition, a live report, I'll explain what it all means.

ALI VELSHI, CNN ANCHOR: We're down to the final day, 17 hours to go until we go over the fiscal cliff. Can the closers, Vice President Biden and Senate Minority Leader Mitch McConnell reach a deal in time?

CHRISTINE ROMANS, CNN ANCHOR: And if we go over the cliff, you will feel it right away. What happens to your paycheck, and when. I'll explain that just ahead.

VELSHI: A packed two hours ahead. We're talking with Grover Norquist. He is the president of Americans for Tax Reform. Utah Congressman Jason Chaffetz, Maryland Congressman Chris Van Hollen, and Georgia Senator Johnny Isaacson.

I'm Ali Velshi.

ROMANS: I'm Christine Romans.

GUPTA: And I'm Dr. Sanjay Gupta. Soledad is official. It's Monday, December 31. STARTING POINT begins right now.

Our starting point, a health scare for Secretary of State Hillary Clinton. Doctors discovered a blood clot during a follow-up exam related to her concussion. The location of the clot has not yet been disclosed, but Clinton treated with anticoagulants, blood thinner, and will remain hospitalized for at least a couple of days, we're told, so doctors can monitor that medical.

CNN's Jill Dougherty is live in our Washington bureau. Jill, what are you hearing, if anything, from her doctors or folks around her?

JILL DOUGHERTY, CNN CORRESPONDENT: Not a lot, Sanjay, since that statement Sunday night. They are really saying -- as you said, they are monitoring, and here is the statement so you can listen to exactly what they said. That her doctors are going to continue to assess her condition, including other issues associated with her concussion, because after all this happened as a result they say of that concussion, and they will determine if any further action is required. So it's really, you know, watch, wait, observe, and see how she's doing.

This has kind of grown. Remember, you know, the flu, then that leads to a conclusion, and now this. So they want to be very, very careful.

And you as a doctor, Sanjay, know that when the secretary travels a lot. The blood clots can be very dangerous for anyone. We don't know where that blood clot is, that could be a very significant issue. In fact, her travel was on hold until the middle of the month.

And the other factor, Benghazi hearings, she was going to be coming back this week, she said looking forward to work and ready to testify up on Capitol Hill. So all of that will be on hold obviously until they figure out what's going on.

GUPTA: Keep us posted for certain. We expect the best. This is not the first time she's had a blood clot. Back in 98 she had a blood clot and she called it one of the scariest medical experiences of her life.

ROMANS: And that told is she had a higher risk of blood clots again if she's had them before?

GUPTA: If you had one before, you are at higher risk. If you travel a lot, like Jill said, the blood flow may be compressed because you're bending your legs like that. And with this concussion, one of the things she was told was to rest. Not easy for her to do, I can tell you for a fact. But that may be part of the inactivity.

VELSHI: So we don't know what the cause is. Back in 1998, it was deep vein thrombosis.

GUPTA: A DVT, a clot in one of the leg veins. In and of itself, not a problem, but it can break off and go to the lungs, called a pulmonary embolism. We don't know what it is. She is on blood thinners, and you treat the brain clot. This is within one of the blood vessels in her legs. They just haven't told us.

VELSHI: What do they do about this? Once you have had an episode of DVT, what's the treatment?

GUPTA: It's the blood thinners, you want to tip the balance a little bit so you are more likely to break up the clot. The downside, you are more likely to bleed if you injure yourself. It's a careful balance and that's the monitoring in the hospital right now.

VELSHI: I heard people say if you travel a lot you should take the low-dose aspirin is that true?

GUPTA: Baby aspirin. A lot of people take it for all sorts of reasons.

VELSHI: I like the flavor.

GUPTA: Orange.

VELSHI: Orange flavor. GUPTA: And it will keep you healthy.

VELSHI: Whatever works, right?

ROMANS: It's a toddler metaphor.

VELSHI: I am like a big baby. I even look like one.

Take a good hard look at your last paycheck of 2012, because it may shrink in about 17 hours, not literally, but the next one may be a little smaller. Two countdowns underway this morning, one to the New Year, the other is to the painful fall off the fiscal cliff. Democrats and Republicans went to the bull pen on Sunday, calling in their so-called closers. Here is one of them, here is the other, Vice President Joe Biden and Senate Minority Leader Mitch McConnell. You notice John Boehner is not in this, Nancy Pelosi is not in this, even the president isn't. The House and the Senate reconvened this morning bright and early, the House at 10:00, the Senate at 11:00. I'm being sarcastic, by the way. Neither of them showing particular signs of progress.

ROMANS: These two worked together in the Senate for 20 years. So you hope --

VELSHI: Right. So in fairness, the houses are not convening, but these guys are not working. I don't care if it doesn't play out in the media as long as it's playing out. The big stumbling block has been avoided. Republicans dropped their demand to reduce Social Security cost of living increases.

(BEGIN VIDEO CLIP)

SEN. HARRY REID, (D-NV) MAJORITY LEADER: I was really gratified to hear Republicans had taken the demand for Social Security benefits off the table. Truth is, it never should have been on the table to begin with. There is still significant distance between the two sides, but negotiations continue.

SEN. MITCH MCCONNELL, (R-KY) MINORITY LEADER: The consequences of this are too high for the American people to be engaged in a political messaging campaign. I'm interested in getting a result here.

(END VIDEO CLIP)

VELSHI: They have all been politically messaging. I'm not sure why they are being critical of it now. Thousands of dollars of your take home pay and the U.S. economy are on the line. White House correspondent Brianna Keilar is live from Washington this morning. Brianna, this is a key point that the speaker was just making. McConnell and Joe Biden are talking. When things between McConnell and Reid stopped working, McConnell the highest ranking Republican in the Senate, Reid the highest ranking Democrat in the Senate, Joe Biden was there as a go to guy. We can probably believe that sometime between last night and 11:00 this morning some work is being done somewhere. BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: That's right. And some of it has already being done, Ali. Talking to an aide to Senator McConnell, we understand that discussions between Biden and McConnell went into the night. So this is something that they are working on, although certainly, yes, it's being left to the last minute and unclear if we'll avert the fiscal cliff.

You talk to some senators, and they say we are going over the cliff. Some way they think there will be a deal by tonight and a vote by tonight, but the fact is it's very iffy.

Here is what's not iffy. There will still be an incentive if we go over the cliff to get this done, because it is -- both sides have been preparing themselves for the blame game. It is in full swing now. Listen to what President Obama said, basically saying if we go over the cliff, he is really going to take aim at Republicans even more than he already has.

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BARACK OBAMA, (D) PRESIDENT OF THE UNITED STATES: They say that their biggest priority is making sure that we deal with the deficit in a serious way. But the way they are behaving is that their only priority is making sure tax breaks for the wealthiest Americans are protected. That seems to be their only overriding, unifying theme.

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KEILAR: Now, Ali, polls show Republicans will bear more of the blame in this if we do go over the cliff. But the incentive to do something continues even if we go over the cliff. So the expectation is come midnight tonight, this is not resolved, even if there isn't some sort of deal, just a framework, there is still going to be work done and there will still be members of Congress and the White House trying to wrap this up here in the next few days.

VELSHI: Polls show not only Republicans will get the blame, polls show that the country supports the president by two-thirds in raising the taxes on the rich. But people do bring up that in 20 years if we go over the cliff, you won't actually remember the name of the speaker of the House or the Senate majority leader who was responsible for it. You will remember the name of the president under whom it happened. Brianna, we'll check in with you.

It's probably important to remind our viewers, Christine, that there are people in America, elected people who feel we should go over the cliff.

ROMANS: And some, for example, Howard Dean, who says how else will you cut a defense budget that has been going up for 30 years? And in the end it does give you a little pay down on the debt and deficit and gives the president some leverage for the first time. People in the middle class hurting, it gives the president leverage --

VELSHI: Not everyone is moving toward a solution. ROMANS: But most are. I want to bring in Chris Frates, a reporter from "The National Journal" he has been working the story all night, and a very slim minority of people think it would be a good thing to go over the fiscal cliff. There are hundreds of billions of dollars of economic activity from early tax refunds that you might not get in the economy in the early part of the first quarter, because people won't get the early refunds because it's just such a mess there. What are you hearing about how close we are or how far away from a deal we are right now?

CHRIS FRATES, REPORTER, "NATIONAL JOURNAL": Certainly the negotiations that have happened through the night continue to the morning. Before I came on with you, I conversed with an aide to Senator McConnell who said we won't know anything until Senate Republicans get to talk around 11:00 a.m. We are still hours away from that.

But Washington woke up this morning with no deal. We're only 17 hours away, and like a bunch of kids in college cramming for their exams, we have a situation where this all-nighter is going to come to an end midnight here, one way or another. And we're waiting to see if the closers, Biden and McConnell, can bring something to the floor that could pass sometime today.

ROMANS: Cramming for the exam, and yet this exam has questions that are impossible to answer and they wrote the exam in the first place. John Avlon described it like this. A time bomb they set that they are now trying to defuse. We should remind people, Congress made this mess. And now they are arguing about whether they have a one-week leeway or maybe we have a -- it's pathetic.

FRATES: Well, I think that time bomb analogy is a very good one. I've likened it often to a slow-moving car wreck where you are watching it happen, waiting for someone to take the wheel to avert the cliff. And the Democrats and Republicans are still far apart on the threshold for who taxes should go up on. Democrats have been at $250,000, but there are reports yesterday as I was talking to my sources that Democrats have moved on that in negotiations with Republicans and somewhere to the $350,000 $360,000 range and Republicans are looking for more around the half million range.

So there is still a ways to go here. We walk into the final hours. And there is a question about whether we go over the cliff and we come back after New Year's Day with the same story being told and the same problem to address.

ROMANS: We talked to a House congressman who says he's not going to -- he won't vote for a $450,000 or $550,000 as the threshold for higher taxes. Thank you very much. Cliffs, car wrecks, closers, just, you know, send me your analogies and metaphors and none of them good.

At the bottom of the hour we'll get Republican reaction from Congressman Jason Chaffetz.

GUPTA: Bitter cold can't stop the party, maybe not even the fiscal cliff.

VELSHI: They can freeze it out.

GUPTA: About 1 million people expected to brave the subfreezing temperatures in New York Times Square tonight with the countdown, 2013. New Zealand, saying hello to 2013, happy New Year. Auckland welcomed the new year with fireworks at the famous sky tower.

VELSHI: Up ahead on STARTING POINT, House Speaker John Boehner couldn't get Republicans to back his plan, even though my next guest said it was OK. Can the GOP really rally his party before we go over the cliff? Grover Norquist is the president of the powerful Americans for tax reform. He's up with us next.

VELSHI: Progressives do not like Grover Norquist. They don't. Now a message from you to Washington as we enter the new year.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: This whole fiscal cliff mess shows how incredibly out of touch you are with the way people really live in this country. You are you off in La-La Land. And everybody is saying you are acting like a bunch of spoil brats who are more interested in being right than in doing the right thing for the people who elected you.

(END VIDEO CLIP)

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VELSHI: Happy new year. We are just about 17 hours from 2013 and also the fiscal cliff. Congress is putting your money at risk this morning. There may be a last-minute vote today in the Senate today. Again, that is more than 517 days after they could have fixed the thing to start with. In case you weren't angry yet, President Obama signed an executive order that gives federal workers including those members of Congress dragging this mess out a pay raise. I'm not actually opposed to the federal workers getting it. One wonders whether Congress has earned their raise.

I want to bring in Grover Norquist, the president of Americans for Tax Reform. Grover and I have never agreed on anything rat all except the fact that congressmen probably shouldn't have had a raise on Thursday. Good morning, Grover. Good to see again.

GROVER NORQUIST, PRESIDENT, AMERICAN FOR TAX REFORM: Good morning. Good to be with you.

VELSHI: We never agree on anything, yet you continue to engage in the conversation, which I always appreciate. Let me ask you this -- you don't want taxes going up on anyone. But when things looked like they were at an impasse and House Speaker John Boehner, the highest elected in the country, put forward his "Plan b" about a week ago, you read it through, and you said you would be OK with people who had signed this anti-tax pledge of yours voting for that bill, voting for an increase of taxes, and I know you will phrase it differently, but voting for something that will allow taxes to go up for those that make more than $1 million a year. That seemed like a sea change for you. Why did you agree to that?

NORQUIST: It wasn't a sea change. Again, the taxpayer protection pledge that we're speaking about is a written commitment by many congressmen and senators, governors, state legislators, that they'll oppose any and all efforts to raise taxes on the American people. Tax reform is fine, but not a net tax increase.

What we have going forward is a -- the 2001, 2003 Bush tax cuts that almost every Democrat voted against. So not commented on is the spectacle of all the Democrats falling over themselves about what a tragedy it would be to have the Bush tax cuts that they opposed and spent ten years trashing, including Obama, that if they lapse that would be the end of the world. So we're making progress. Democrats are defending the Bush tax cuts for 98 percent of the American people, the ones they voted against For 100 percent of the American people. We'll take that 99 percent, 98 percent movement by the Democrats toward the taxpayer position.

VELSHI: Get to the point, Grover. I know this argument.

NORQUIST: We don't see it in the established press very often.

VELSHI: We see you on establishment press pretty often. In fact you and I spoke on Friday afternoon and it was on TV all weekend. The argument that your thoughts don't get out there, all I got were tweets about why do you keep putting Grover Norquist, who is part of the problem, on TV, because you have to have this conversation because you have a great deal of influence.

NORQUIST: Right, and some folks on the left are not big on the First Amendment for other people.

VELSHI: We are very big on the First Amendment here at CNN.

NORQUIST: Good. Look, what we need to do is extend the Bush tax cuts as Obama did two years ago for every single American. What Boehner said is let's get that done for 99 percent Americans and then he has two points of leverage over the next four years.

This fight does not end in a week, OK? This is a long-slogging fight because there are no budget cuts on the table that Obama or Democrats have put there. We haven't gotten to that conversation. We should take as many as the tax cuts off the table as possible, and then because the Republicans have the clout of the debt ceiling increase, which they effectively used a year and a half ago, and the continuing resolution, where they can dole out money slowly to Obama and the Democrats to spend while reining is in.

VELSHI: I'm not sure how effectively they use it. That was 517 days ago and that's why we're in the mess we are in.

But I want to show you marginal tax rates around the world. That's the highest tax rate people pay on the marginal money they earn. When we talk about increasing taxes, we are talking about increasing it above a threshold. The United States is not the highest on the list. The United Kingdom is on this list, and this isn't all the countries out there. Both Canada and Germany have higher marginal tax rates than the United States does. Germany and Canada have borrowing rates about the same as the United States and in fact have higher home ownership rates. They have health care and education paid for, great life satisfaction in those places and very strong economies. So what's the argument if we increase the tax rates on the richest Americans we're somehow going to have economic catastrophe?

NORQUIST: Ali, as you know when people pay taxes, they not only pay it at the individual level, but capital gains and other taxes. First you earn money and then you invest it in companies. And if you take a look at corporate income tax and all of the companies you threw out, the United States has the highest --

VELSHI: The United States doesn't have the highest effective corporate tax rate. The United States has the highest marginal tax rates, and most companies as you know, including general electric, the biggest, don't pay any taxes, right?

NORQUIST: The marginal tax rate is the tax rate that matters on the actual dollar earned. When we look at Canada with about 17 percent, the European average 25 percent, our average is 35, or 10 points above the European average. Stupider than France is not where we want to be when it comes to how we tax economic activity.

Add to that that Obama not only wants to take the present 35 up to 39.4. He wants to add another 3.8 percent on that for small businesses, Subchapter-S corporations. Remember there is also $1 trillion in tax increases that Obama care has that begins over the next decade. In addition to --

VELSHI: They're net reducers to the deficit over ten years. Let me ask you this last question.

NORQUIST: The tax increases that affect people's decisions.

VELSHI: Will you be around and do you expect to be reached out to as a deal is reached to give it a blessing?

NORQUIST: Certainly I'm working with all of the folks trying to defend taxpayers here in Congress in the House and Senate. The leadership of the House have all made the commitment in writing their constituents to oppose al efforts to raise taxes. I don't think you will see something that actually raises taxes. We may get some tax cuts now and have to fight for others later. Watch for the leverage that the Republicans have in the debt ceiling and the continued resolutions. That allows us to come back and actually fight for spending cuts, but also for further tax reductions.

VELSHI: Grover, good to see you, thank you for being with us.

NORQUIST: Good to be with you.

VELSHI: Once again on the mainstream media.

NORQUIST: The establishment.

VELSHI: The establishment media. Thank you. I'm sorry. As Grover points out, we will not be dealing with the debt ceiling today or the continuing resolutions. He points out one of the things we have not been successful on in the United States is passing budgets, so we have so-called continuing resolutions which allow government to keep on operating.

ROMANS: This will go on and on and on. He is right. And we have one deadline after another. This big fight -- Congress for 10 or 15 years has set us into this frenzy of deadline after deadline after deadline, 11th hour.

VELSHI: It's not good. If your taxes might go up next year, what about your grocery bill? We're going to talk about the deal that could affect milk prices coming up next. You're watching STARTING POINT.

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ROMANS: Ahead on STARTING POINT, we're following the latest on the fiscal cliff negotiations. We'll ask one House member if he expects to be voting on a deal today. Next, Utah Congressman Jason Chaffetz, member of the House oversight committee.

And is the Kardashian clan about to get bigger? The new year's news you had to have. Kim and Kanye West, they respond to the pregnancy rumors. Breaking news, everyone. You're watching STARTING POINT.

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