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EARLY START WITH JOHN BERMAN AND ZORAIDA SAMBOLIN

Senate Passes Fiscal Cliff Deal; Hillary Clinton's Health Scare

Aired January 1, 2013 - 05:00   ET

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


JOHN BERMAN, CNN ANCHOR: It's a deal. Just hours after the East Coast rings in the New Year, the Senate overwhelmingly passes a bill to stop the country from falling off the fiscal cliff.

ALI VELSHI, CNN ANCHOR: But as 2013 is officially rung in, we're still technically going over the edge of the cliff. As of right now, we have no word on what the House of Representatives will do. But, as we wait we'll walk you through the bill's details and tell you who's impacted and how.

CHRISTINE ROMANS, CNN ANCHOR: Also, the other big story this morning. We're learning more about Secretary of State Hillary Clinton's blood clot in her head that sent her to the hospital. The latest on her treatment and prognosis.

BERMAN: Good morning, everyone. Welcome to EARLY START. Welcome to the special edition of EARLY START, the fiscal cliff edition. We're over the fiscal cliff. I'm John Berman.

VELSHI: I'm Ali Velshi. It's hard to do this after that crazy night of partying.

ROMANS: Yes, right. I'm Christine Romans. Zoraida is off today. It's 5:00 a.m. in the East. Let's get you started.

BERMAN: And up first, of course, as you all know because you were glued to it all night, America kicked off the New Year by falling off the fiscal cliff. But, in breaking news this morning, we're talking just hours ago, there is now a deal in place that could cushion that blow.

Here's what happened while you were sleeping. Or sipping champagne or doing something else. An eleventh hour agreement crafted by Vice President Joe Biden and Minority Leader Mitch McConnell in the Senate has been passed by the Senate by a margin of 89 to eight. That vote just took place a couple hours ago.

Now, it's up to the Republican-controlled House to take up that plan later this morning, and that is where it gets very interesting. If the House approves, and it's a big if, the deal would generate an estimated $600 billion in new revenues over the next 10 years.

Here are some more of the details. Under the plan, Bush-era tax cuts remain in place for individuals earning less than $400,000 a year, families earning less than $450,000. Unemployment benefits for 2 million Americans extended for a year. The alternative minimum tax will be permanently adjusted for inflation. And as for spending cuts, pretty much that gets kicked down the road for another two months.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D-NV), MAJORITY LEADER: I'm disappointed that we weren't able to make the grand bargain as we had tried to do for so long. But we tried.

SEN. MITCH MCCONNELL (R-K), MINORITY LEADER: So it took an imperfect solution to prevent our constituents from a very real financial pain. But in my view, it was worth the effort.

(END VIDEO CLIP)

BERMAN: So honest to goodness, Washington was up all night and not for the normal New Year's reasons. This was a long time coming. The Senate just passing this a short time ago.

I'm joined now by White House correspondent Brianna Keilar, up all night, also, no doubt. She is in Washington. She was watching this vote with all of us.

What happens now?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: Well, it could be as soon as today that the House would vote, John. There's a little bit of uncertainty here. But I think that is the expectation that we're still waiting to see that definitely today. President Obama putting out a statement last night saying while neither Democrats nor Republicans got everything they wanted, this agreement is the right thing to do for our country and the House should pass it without delay.

But the thing is, you will have to wait and see. Speaker Boehner will have to meet first with his conference, and he will have to see where they are on this. He'll have to sell this plan to them. But presumably, because Mitch McConnell negotiated this and he was doing so, certainly, with an eye to what could get through the House of Representatives, and also because it passed with such overwhelming support, the expectation, I think, is that this will be able to make its way through the House.

Of course, it comes down to the rank and file House Republicans. As you know, they have been difficult to please on this issue. And if there isn't a vote on this bill outright, if they really don't like it, they could propose to amend it. Make some changes, and then send it back to the Senate, which would take a little more time, obviously. But the thought here is now that we're over the cliff, House Republicans would be voting for a tax cut, instead of for a tax hike, and because of that, the House Republicans, more of them, may be able to support this, John.

BERMAN: And, Brianna, we will be speaking to a number of house members over the course of the morning. Are they going to vote yea or nay on this? We'll get some answers hopefully this morning.

But let me ask you this, what was the president's role and the White House role as we headed into this overnight vote last night?

KEILAR: Well, obviously, I think leading into what you saw was Vice President Biden being very involved, and in a way he served very much as the president's proxy. This is something that has taken a lot of the president's attention. But some people, I was actually asked yesterday, you know, what was he doing? Because it seemed like Joe Biden was very much in charge.

Well, the fact is, Biden was acting very much as an extension of him and it sort of makes sense when you think of the rhythm of how Congress works. While the president, of course, served in the Senate. Joe Biden served in the Senate for decades, alongside Mitch McConnell. And it was really, I think, that relationship, and sort of his knowing the rhythm of Congress. And also, frankly, the deadline that helped kind of push this along.

BERMAN: All right. Brianna Keilar in Washington, thanks for being with us. We'll talk to you again real soon. Thanks, Brianna.

VELSHI: All right. Let's stay in the capital now with Jonathan Allen. He's the senior congressional correspondent for "Politico".

Jon, give us some sense of the word from the House this morning, because we're going to spend a lot of time telling all those folks who might have been doing something other than paying attention to what was going on with the fiscal cliff overnight what the details of the plans are. Are wasting our breath? Is this going to make it through the House?

JONATHAN ALLEN, THE POLITICO: The message we're hearing from house Republicans now is that one of two things is going to happen. They're either going to attempt to amend this bill and send it back to the Senate with something that the House Republicans like better. But failing that, and, of course, they failed to do that with their Plan B last week, failing that sounds like John Boehner will put this on the floor to see if it can pass with a mix of Democratic and Republican votes.

VELSHI: And let's think about that. I mean, this was -- it got overwhelming Democratic support in the Senate. And there were really some doubts about that last night. There were a number of Democrats in the Senate who really expressed concern, there are a number of progressives in this country who expressed concern with this, as well as conservatives.

Does the overwhelming majority in the Senate influence those Democrats in the House who could really take this over the finish line?

ALLEN: Well, I think really, the pressure is on the other side on Republicans, both pressure and cover. That 89-8 vote says that the entire Senate essentially is behind this thing. That puts pressure on Republicans in the House whose home state senators have already voted for it. And it gives them cover because those home state senators have already voted for it.

If everybody joins hands and jumps off together, there's a little bit of shared faith --

VELSHI: Right.

ALLEN: -- a little bit of a ability to sell back home.

As far as the Democrats go, I think the president's not going to have a whole lot of trouble as evidenced by the vote in the Senate last night, not going to have a whole lot of trouble getting his guys on board. They will complain a bit. They'll moan about it. And, of course, they still have to read it.

This thing was not publicly available last night when the Senate voted on it. So, the House members are going to wake up this morning, and they may very well be the first people to read it in its entirety.

VELSHI: Let me ask you about this, about 50 very Republican conservative members of the House gave John Boehner some trouble a little over a week ago with Plan B. They now have in many cases have the cover of their home state senators voting in favor of it and they've got Grover Norquist who says this bill's OK.

So do you think they bow to that pressure?

ALLEN: I'm not sure necessarily that those 50 Republicans that have been the hardest nuts for John Boehner to crack will necessarily bow because of this bill.

But what I do think is that John Boehner is in a position now where he can back them up in a corner and say, look, if you're not going to vote for this, it will pass with Democratic votes, my hands are tied at this point, I ask the Senate to act and give us something to work with. It's over here now. This is our option. We can either amend it, send it back with something better we like, or just pass it as is.

And so I think those 50 votes may be against it but with the Democrats coming on board, it should not be a problem.

VELSHI: John, thanks very much for your insight this morning. You have a good day.

ALLEN: My pleasure.

ROMANS: So let's break down now what's in some of this deal. What it means to you. We've been telling you about the so-called dairy cliff. In addition to dealing with the fiscal crisis, the Senate deal would extend federal farm policies through September which would mean milk prices will not double. The deal also nixed a set pay raise for members of Congress.

The White House scored an agreement to raise tax rates on larger estates from 35 percent to 40 percent, but Republicans successfully insisted the exemption should be adjusted annually for inflation. There were some Democrats, by the way, who agreed with that, too. Farm state Democrats, a provision that would increase the exemption amount to $7.5 million for individuals and $15 million for couples by 2020. Those households also would pay higher rates on investment profits with rates on dividends and capital gains rising from the 15 percent where it is right now to 20 percent. Now, for taxpayers earning less than $450,000 a year, the deal would restore limits on personal exemptions and itemized deductions that existed back during the Clinton administration with those benefits saving up for couples earning more than 250 grand a year, single people earning more than $200,000.

Now, the deal called for a permanent fix for the alternative minimum tax which would otherwise hit about 30 million taxpayers for the first time when filing their 2012 tax returns. And it would extend tax credits for college tuition and the working poor for five years.

On the business side, some popular tax breaks would be extended through 2013, including a credit for research, which benefits high tech companies and an investment write-off that helps manufacturers.

The long-term unemployed, now a lot of people, millions of people have been watching this, they could count on receiving emergency benefits for another one year. Doctors, they will be spared a 27 percent cut in Medicare reimbursements. That was set to take effect this month, although the $30 billion cost of that extension will be covered by cutting other health care programs.

There's an awful lot in here. All this depends on whether the House does it, too. So this is not all settled. That's what the Senate version of this is.

And here's the other thing, folks. Everyone -- I want to be very clear here -- your paycheck is going to be a little bit smaller. There's no question, because payroll tax holiday is done, right?

VELSHI: And that haven't been touched.

ROMANS: That's going to be $10 to $40, depending on how much you make. You know, you got to be aware you're going to have a little less money in your paycheck this year.

BERMAN: And if you're lucky enough to make a lot of money over $450,000, if your wealthy anyway, your taxes are going up more than just this amount, because of things that were already in place, the Medicare tax, and the Affordable Care Act.

ROMANS: That's right.

BERMAN: It's actually going up on all people.

I'm curious, guys, what you make of this deal in general? You guys come from the business world right now. What will be the response on the street? What's the response in board rooms, to this deal?

VELSHI: This is a small, as puny, as insignificant a deal as you could have made to avert the fiscal cliff. I think this just gives you that sense that so many people went into these last few days thinking that, why doesn't Washington ever get ahead on this thing and do that comprehensive deal?

Everybody would like the certainty of a real deal that addresses the deficit over the long-term and taxes, and this is not that.

BERMAN: But there is certainty in this, Ali. I mean, there is certainty. There's a lot of certainty in the issue of taxes. You are making permanent the Bush tax cuts and you are setting that limit on high taxes. The alternative minimum tax, which we talk about every year, it's a permanent fix.

VELSHI: Yes. That certainty is great. That was the more political and interesting part of this discussion. The more complicated and difficult part of the discussion is what you do on spending and deficit. That's the part that they didn't take any responsibility on.

So we're guaranteed between that and the debt limit discussion that we'll be sitting here talking about this for another couple months.

ROMANS: The stock market liked it. The Dow closed up 166 points. It's not open today because of the holiday. But markets definitely like this.

The question is, is this a down payment on real deficit reduction, and a new budget negotiation, a new era of getting our budget house in order in Washington? That's what Wall Street wants to see.

It's been radio silence from CEOs, by the way. Their whole Fix the Debt Campaign, I have not heard from CEOs on this yet.

BERMAN: So, the good news for everyone, you can follow it all day, because it's not over yet. The House still has to vote on this.

Stay with CNN. We will bring you the latest all morning, all day on this, a lot more to talk about.

In the meantime, there is a lot of other news going on.

We're learning more about Secretary of State Hillary Clinton's health scare. Doctors say a routine MRI revealed a blood clot in a blood vessel around her brain. They say Mrs. Clinton did not suffer a stroke or any neurological damage as a result of this, and the secretary is expected to make a full recovery.

Still, it doesn't -- it sounds scary, frankly.

Jill Dougherty is live at the State Department right now.

Jill, first of all, happy New Year, I should say.

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Same to you, John.

BERMAN: What else do we know about her condition? Because when you hear blood clot near the brain that does sound serious.

DOUGHERTY: Yes, it does. When we first heard it, it did. But when they refined the idea, I mean where it's located is not in the brain. And that would be very scary, because then you would have something perhaps like a stroke. But it's in that vein that goes between the skull and the brain.

So it's kind of isolated from the brain, and what they're trying to do right now, is to shrink it. And the way they do that by giving blood thinners and that, indeed, is what she is doing in the hospital in New York right now, getting these blood thinners. And you have to kind of, as they say, titrate it, figure out how much she needs, and that takes a little while. And when they pin that down then they will be able to figure out her dosage and then eventually she will be released. But she won't until they figure that out.

So it is a potentially pretty serious thing. But the good thing is, her doctors last night, in fact, saying she's talking with her doctors, talking with her family, completely engaged, and that she should make a full recovery. And that's the most important thing.

BERMAN: All right. Jill Dougherty in Washington -- I should say Chelsea Clinton tweeted a short time ago, thanking everyone for their well-wishes to the Clinton family through this as Mrs. Clinton does get better in the hospital. Thanks a lot, Jill.

Meanwhile amidst the chaos around the fiscal cliff, the New Year actually was ushered in last night. And in many places it happened in grand style. The crowd estimated at 1 million packed New York's Times Square, and they counted down to 2013.

(VIDEO CLIP PLAYS)

BERMAN: I can't believe I slept through that.

And as 2013 rolls into Las Vegas, a spectacular fireworks show lit up the night sky over the Vegas Strip. Check that out. That's pretty cool.

ROMANS: This is our New Year's Eve right here.

BERMAN: That's right. This is how losers celebrate new year's, ladies and gentlemen.

ROMANS: We're geeks. Not losers.

BERMAN: Thank you very much.

All right. Meanwhile to other news:

Two planes were damaged at Fort Lauderdale Hollywood International Airport last night when the wing of a taxiing Spirit Airlines flight clipped the tail section of a parked United Airline jet. There was a gash in the tail section of the United plane but no fuel leaked from either aircraft and no injuries were reported.

VELSHI: All right. Still to come on EARLY START, as we've been reporting, we have new details on Secretary of State Hillary Clinton's health scare. A blood clot in her head, how serious can that be? Sanjay Gupta will explain her condition for us.

You're watching EARLY START.

(COMMERCIAL BREAK)

BERMAN: Welcome back to EARLY START, everyone.

Secretary of State Hillary Clinton spending New Year's Eve in a New York City hospital. Mrs. Clinton is being treated for a blood clot in her head.

So, we asked our chief medical correspondent, Dr. Sanjay Gupta, about her condition.

(BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: We do have some of these details now about what precisely happened to Secretary of State Clinton, and the specific blood clot. The blood clot that we're talking about now was unclear where it was located previously. But we now know it's in one of the blood vessels around the brain. It is not, again, on the brain, pushing on the brain in any way. But it is a blood vessel that actually drains blood away from the brain. It's called a cerebral vein.

And I want to show you here, we know that in Secretary Clinton's case it is on the right side of her head somewhere in this area. It's called the right transverse sinus.

Let me show in this model here, I'll show you the left side just for sake of demonstration here. If I remove the hemisphere of the brain here, you can actually see where the veins are. You see that blue area right there, that is the area that is actually draining blood away from the brain, and one of these veins in this area, that's where that clot actually has occurred.

Most likely due to a combination of the head trauma that she had a few weeks ago, in addition to the fact that she has had a problem with blood clots in the past dating back to 1998. We're hearing from her doctors. They say she's on blood thinners. They say she is awake, she is talking, and most importantly, there's no evidence of stroke or neurological damage.

My guess is they're going to continue to monitor her at least for another couple days in the hospital and probably get another scan at some point to make sure that clot is, in fact, dissolved as a result of those blood thinner medications. As we get more details we'll certainly bring them to you. Back to you for now.

(END VIDEOTAPE)

BERMAN: And, of course, we cannot repeat this enough. Mrs. Clinton's doctors expect her to make a full recovery.

ROMANS: All right. Coming up: the Senate agrees to a fiscal cliff deal. But is the crisis really averted? What it really means for the average person in your paycheck.

(COMMERCIAL BREAK)

ROMANS: Minding your business this morning. Markets are closed today! I can tell you with great certainty what about happen in stocks -- nothing.

Everyone's waiting to see what the fiscal cliff will do to your 401(k) in the early part of the New Year. Markets in Asia mixed overnight. U.S. stock markets, by the way, finished 2012 on a very high note. The Dow gained more than 1 percent to finish the year above the 13,000 mark. The Senate's progress yesterday, something that stock market investors certainly like to see.

But the fiscal cliff is only the beginning of the fiscal drama. Oh, yes. There are three -- count them -- three more cliff-like deadlines over the next three months.

First, the debt ceiling. Yesterday, the treasury secretary made it official, federal borrowing has reached the $16.4 trillion debt ceiling. They can't issue more debt, right, without raising that debt ceiling. Congress has to do it. We have about two months of head room, which means the deadline to tackle that would be late February or early March.

Next up, the sequester. A series of automatic 8 percent to 10 percent cuts in many federal agencies. The Senate's fiscal cliff deal would kick that can down about two months to March. You got a lot of federal agencies trying to figure out what's that going to mean? Is that going to mean furloughs? What's that going to mean down the road?

And then there's the continuing budget resolution which uses short- term band-aids. The current resolution expires towards the end of March.

So, before you think that we've averted any kind of fiscal cliff, we're actually hanging off of it by our fingernails waiting for the House to fix it and you've got all these other deadlines.

BERMAN: It's no joke. We have gone to the brink on each one of those three things.

VELSHI: That's the way we do it. That's the way we do it now. We wait until the absolute last minute to get things done.

BERMAN: But let me give you the glass half full here. We are in --

(CROSSTALK)

ROMANS: Half full of what? Champagne.

BERMAN: We're in an environment of risk, we're not making it worse type environment. We're doing things to address the deficit and the debt, slowly but we're doing it.

VELSHI: Yes, the problem not having a budget really is fundamentally a problem. The government does all sorts of things, it passes all sorts of resolutions whether you like this country or don't like that one. But the basic constitutional responsibility of the government is actually to have a budget.

And a budget is the manifestation of your priorities generally speaking. That's the one thing that would just be great if we actually did.

ROMANS: Here we are at the beginning of the year where we're all trying to sit down with our budgets and figure out what our priorities for the year, what are we going to say, what are we going to spend, how are we going to live a little bit below our means so we can grow wealth and our government can't figure out a budget. So, I mean, my advice --

VELSHI: I'd like it if they did that.

ROMANS: Yes, my advice is deal with your own financials.

BERMAN: All right. Good luck with that guys. I wish you all the best.

Coming up, one down, one to go. Will the House go along with the fiscal cliff deal hammered out by the White House and the Senate earlier this morning? We're going to have a live report from Washington just ahead.

ROMANS: And if you're leaving the house right now, you can watch us any time on your desktop or your mobile phone. Just go to CNN.com/TV.

(COMMERCIAL BREAK)

BERMAN: While you were sleeping, no rest for lawmakers. Not that they deserve any. As an early morning deal is reached in the Senate on the fiscal cliff. But the U.S. still poised to go over the edge.

VELSHI: I don't know why we keep saying while you were sleeping. Do we think anybody was sleeping?

(LAUGHTER)

2013 is officially rung in. As of now we have no word on what the House of Representatives will do. But as we wait, we'll walk you through the bill's details and tell you the impact that it has on you.

ROMANS: And Secretary of State Hillary Clinton waking up this morning in a New York City hospital. Doctors say she's making excellent progress. We're going to have the very latest on the secretary of state's condition.

VELSHI: Welcome back to EARLY START, I'm Ali Velshi.

ROMANS: I'm Christine Romans. Good morning, everyone.

BERMAN: And I'm John Berman. It is 31 minutes after the hour. We're having a great time here.

VELSHI: We are.

BERMAN: Right? There's no better way to be over the fiscal cliff than sitting here with you, guys. So --

(LAUGHTER)

So thank you this morning. So after kicking off the new year by falling off the fiscal cliff, or at least going over it, the Senate has now acted and now it's up to the House to deliver all of us a soft landing this morning. If they can.

Just after 2:00 Eastern this morning the Senate overwhelmingly passed the plan that was crafted by the vice president and the Senate minority leader. The vote, very big, 89-8. The Republican-controlled House left well before midnight last night, so they will have to take up the measure later this morning.

Here's how the two Senate leaders summed up their night.

(BEGIN VIDEO CLIP)

SEN. HARRY REID (D), MAJORITY LEADER: I'm disappointed that we weren't able to make the grand bargain as we've tried to do for so long. But we tried.

SEN. MITCH MCCONNELL (R), MINORITY LEADER: So it took an imperfect solution to prevent our constituents from a very real financial pain. But in my view, it was worth the effort.

(END VIDEO CLIP)

ROMANS: So here's what the Senate plan means for you. Bush-era tax cuts extended for people earning less than $400,000 a year. And couples earning less than $450,000. Unemployment benefits extended for a year for two million Americans. And a permanent adjustment for inflation to that alternative minimum tax.

Now if you're wondering about spending cuts, lawmakers -- well, they're punting. They'll fight about those over the next couple of months. Can't wait for more drama from D.C.

BERMAN: So it's not nothing but Ali says it's puny. Still, it's what Washington did last night. So Brianna Keilar joins us live now from Washington this morning, up all night like the rest of us.

Do we have any idea what happens next, Brianna?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: Well, the House -- its obviously in the court of the House. They could vote on this as soon as today. In fact, they could vote on this on the early side today, midday. But it's still to be seen. Because House Speaker John Boehner needs to take this deal and he needs to go before his conference, and he needs to say, hey guys, what do you think about this?

So he'll have to go through this process of trying to sell this to his conference. The thing is, since Mitch McConnell, the top Republican in the Senate, negotiated this, presumably he did so with some buy-in from the speaker, and also this passed so overwhelmingly that the thought is, this will get some -- obviously some Republican support. How much, still to be determined in the House.

Of course, President Obama wants the House to take this up right away. He said, "While neither Democrats or Republicans got everything they wanted. This agreement is the right thing to do for our country and the House should pass it without delay."

This does, though, John, come down to rank-and-file Republicans. They've proven the hardest to please here. And so they may not just take up the bill. They could amend the bill, change it more to their liking, and send it back to the Senate. That's one possibility. And we don't know exactly which direction House Republicans are going to choose. But the bottom line is, it's House Speaker John Boehner who determines what goes to the House floor.

BERMAN: And of course the last time he went to his caucus and said hey, guys, it didn't work out so well for him. But this is different, Brianna, largely because he doesn't need every one of his Republican votes on this. They need to cobble together a group of Republicans and a group of Democrats to get this passed, correct?

KEILAR: That's right. And this is different for a couple of reasons. One being what you just said, that he can pass this with some Democratic support, and we saw that, obviously, happen in the Senate. But the other reason this is different is because we're already over the cliff. Technically speaking, all of these taxes have already gone up, right?

So right now, you would have House Republicans voting for tax cuts, not for tax hikes, and that is much, much more palatable to them -- John.

BERMAN: All right. Brianna Keilar in Washington. Great to see you this morning.

VELSHI: It's been a frustrating exercise for everybody. We gave some of you the chance to vent about the fiscal cliff. And you had some strong opinions.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: My feeling is that it's a shame that we've elected these officials and they can't do their job, and they blame each other, or the other side, when it's the American people that are suffering.

UNIDENTIFIED MALE: We may have to look at the income diversity of congressmen and congresswomen, like vast majority of them are millionaires plus. So we really have to think about who is representing us in politics and how do we make our representatives more reflective and more diverse of the American people.

(END VIDEO CLIP) VELSHI: All right. The story is still developing. And as we get new information, which actually Christine has some of, we're going to bring it to you through the morning.

Christine, what's this morning information that you have?

ROMANS: He's making -- he's making fun of me because I said --

VELSHI: Tell him to stop because it's important.

ROMANS: Well, the IRS has issued new guidelines for withholding tables going back to the 2001.

VELSHI: Right.

ROMANS: You know, getting rid of --

VELSHI: Youre one -- you're one of these people who wants to get your tax return for 2012 started now. Your pat payroll to --

ROMANS: I would recommend you wait. I would recommend you wait. Ali is being unnerved but it shows you that the IRS, it shows you the treasury is preparing --

VELSHI: I'm basing this on many, many years of working with you.

(LAUGHTER)

I love you like a sister but warm.

ROMANS: No -- so much younger sister.

BERMAN: We will bring you news -- we will bring you news like this all morning, ladies and gentlemen. So stay with us. Don't go anywhere because it is New Year's Day.

VELSHI: Happy New Year.

BERMAN: And in case you missed it, here's the countdown as 2013 arrived in New York's Times Square about 5 1/2 hours ago.

All right. People making out in Times Square right there. Happy New Year, everyone. One million people packed the Square to welcome in the New Year.

As I said, happy New Year, guys. From Toshiba and all of us here at CNN.

(LAUGHTER)

We know that Secretary of State Hillary Clinton, of course, is being treated for a blood clot in her head. This news has hit all of us the last few days. Clinton doctors say a routine MRI revealed a clot in a vein between the brain and skull behind her right ear. They say there's no evidence of a stroke or any kind of neurological damage.

Secretary Clinton is being treated with blood thinners to help dissolve the clot. She is expected to make a full recovery.

ROMANS: All right.

VELSHI: But it's scary stuff.

ROMANS: I know. I know. It really is. And wish her the best.

VELSHI: Yes.

ROMANS: And her family, too, on this new year.

In the fiscal cliff crisis, lots of finger pointing. Lots of can picking. Lots of metaphors and analogies, 517 days of it to be exact. House Speaker John Boehner feeling a lot of the heat.

We'll talk with the spokesperson for a conservative group that suggests that he resign because of his failed plan B.

(COMMERCIAL BREAK)

BERMAN: All right. We're playing the waiting game right now here. We are waiting to see if the fiscal cliff deal worked out between Vice President Joe Biden and Senate Republicans can pass in the House of Representatives later today.

Late last night, really early this morning, the Republican leadership in the House released this statement. "The House will honor its commitment to consider the Senate agreement if it's passed. Decisions about whether the House will seek to accept or promptly amend the measure will not be made until House members, and the American people, have been able to review the legislation."

All right, Ron MEYER is the spokesman for the conservative group American Majority Action. His group suggested Speaker Boehner resign for proposing his plan B. That was a while ago right now. He joins us now this morning.

And, Ron, I should say, we've had you on the show a number of times. One of the last times we had you on you correctly predicted very early that plan B was not going to pass in the House. That was the measure that Speaker Boehner proposed a few weeks ago.

So I want to ask you today, as we're heading into the crucial fiscal cliff vote in the House, do you think what the Senate just passed will pass the House?

ROM MEYER, SPOKESMAN, AMERICAN MAJORITY ACTION: Well, it could pass the House. But he definitely doesn't have the majority of the GOP caucus right now. As of last night he didn't have anywhere close to a majority of the caucus in support of this plan. He was having a hard time getting his own leadership behind this, much less majority of the caucus.

So I would say that there's at least 100 Republicans who will vote against this if they bring it up as proposed by the Senate. The Biden/McConnell plan, think about it this way, it's a 41-1 ratio as far as balance goes. It's -- $620 billion in tax hikes, only $15 billion in cuts. In fact, it's actually less cuts than the status quo right now. And so for Republicans it's extremely not palatable for people who actually care about saving my generation from a huge amount of debt. This plan is a complete joke.

BERMAN: Let's stick to the policies for a second.

MEYER: Yes.

BERMAN: I'll (INAUDIBLE) my business colleagues on you in a second on the numbers, but on the politics of it, it seems to me what you're saying is that even though it may not get a majority of Republicans in a House vote you think this measure is going to get through today.

MEYER: Well, it could -- it could very well get through today. It really comes down to whether or not Nancy Pelosi can make up for that in her own caucus. I think that from what I hear on the liberal side is that they don't have a ton of support for this, too, on the House side because progressives are extremely dissatisfied with this plan as well.

They think that people under $250,000 who make more than that are evil people and should be taxed to oblivion and so they'd like to see huge amount of tax hikes --

(CROSSTALK)

BERMAN: All right.

MEYER: And I don't think --

BERMAN: Ron --

MEYER: Yes.

BERMAN: One last political question again before my business colleagues jump on you.

MEYER: Sure.

BERMAN: On the business side -- on the politics side of this, you went after Speaker Boehner for proposing plan B. What about Mitch McConnell right now? Mitch McConnell shepherded through this deal with the White House. Where does your group stand on him and his leadership in the Senate, and his next election, which is really less than two years from now?

MEYER: Well, obviously we're not a big fan of what he just did with the president -- with Vice President Biden. And the plan, like I said, isn't balanced at all. President Obama is insisting on a balanced approach. It's 41-1. And for McConnell to go along with it and to whip the rest -- a lot of his colleagues along with him in the Senate. It's pretty -- it's pretty sad, to be honest. But as far as political repercussions, I think that considering it happened, what, when people are still celebrating the new year, I think we're going to wait and see whether or not we're going to try to act against -- you know, McConnell. I think that they obviously have been forced into this sort of situation by President Obama by actually -- I mean literally these people are celebrating new year's in their offices. And then they're forced to come on to the floor and vote for something.

Of course, I think there's a little bit more negotiating room when you have that -- when you use that kind of leverage and force it to the last minute like this.

VELSHI: Hey, Ron, it's Ali Velshi. Good morning, happy New Year to you. You know, one of the things that Grover Norquist has been putting forward and a number of conservatives have --

MEYER: I'm so happy you brought him up.

VELSHI: Yes. There you go. You can't get really a few hours in without talking about Grover Norquist on these things. But, you know, one of the things you brought up is that if you settle on the tax matter, which is the most political, actually not the most complicated part of this thing, it's just the most political for reasons you stated. You then can move on to the next stage of this, which is really a smart, sophisticated, effective discussion on entitlement reform, on spending reform.

Do you buy that argument? I mean, maybe this is a bit of a success. You put the tax stuff on the back burner now, we've agreed to it, and we move on, and we start talking about spending and deficit reduction.

MEYER: I mean, it's going to be the same -- its going to be the exact same debate. President Obama outlined that yesterday that these tax hikes -- these tax rates -- these tax hikes are not enough for him. That he's going to go after more tax hikes. So it's going to be the same discussion. And the fact is we're just ceding more and more ground and more and more jobs, by the way, that young people need.

And so that's one of the things where I think House Republicans get it, where -- at least I mean the majority of our caucus gets it to the fact that where we're going to stand up against this plan because it's bad for young people, it's bad for our future, it's bad for the rest of America, too. (INAUDIBLE) big a lot of great article in "The Washington Times" yesterday about why this plan and why plans like this are going to actually hurt and bankrupt our generation.

I think there's at least a core group of Republicans who are actually going to defend that and try to get a real solution done. Something that addresses entitlement reform, that doesn't just tax people.

This is a tax bill. This just raises taxes. And that's all it's doing. And the fact of the matter is bringing Grover Norquist, this just shows how little power Grover has. Grover is a friend and I like him. However, remember with plan B? He endorsed plan B and guess what? We shot it down. We had more than 50 Republicans against that bill. Grover Norquist's power is really -- I mean it's just Washington created. It's media created.

(CROSSTALK)

VELSHI: You think it's over for Grover? Just say it's over for Grover.

MEYER: I'm not saying it's over for Grover. He has a great pledge. He does great work. But to say that he's some sort of like magician behind the curtain is absolute fallacy.

ROMANS: All right, Ron Meyer, thanks for joining us this morning. Happy New Year, Ron. Great to have you this morning.

MEYER: You, too.

ROMANS: You know, for some Republicans we hear that the president has not been leading, he's been AWOL, and where's been the presidential leadership? He said the president forced them into it and they were all celebrating in their offices last night because the president forced them into --

(CROSSTALK)

VELSHI: Ron feels -- sounds like a guy who actually got a lot of sleep last night.

(LAUGHTER)

ROMANS: He's energetic in there.

VELSHI: Yes.

ROMANS: All right, coming up on EARLY START, finally, closure, in the infamous case of pardon for civil rights activists 40 years in the making.

If you live in a house right now you can watch us any time on your desktop or your mobile phone. Just go to CNN.com/TV.

(COMMERCIAL BREAK)

ROMANS: All right. It's 51 minutes after the hour. Let's get you up to date.

We're officially over the fiscal cliff but it may wind up being more of a slow tumble than a plunge at this stage because earlier this morning the Senate overwhelmingly passed a plan that keeps the Bush- era tax cuts in place for individuals earning less than $400,000 a year and couples earning less than $450,000. The House takes up the measure later this morning.

Civil rights activist known as the Wilmington 10 have been pardoned by North Carolina's outgoing governor. Nine African-American men and one woman were convicted of firebombing a grocery store in 1972. Their sentences were commuted in 1978. Their convictions were overturned two years later but now, now, finally a pardon. Governor Beverly Purdue saying their convictions were tainted by naked racism. BERMAN: The 124th Tournament of Roses parade in Pasadena will take on a different look today. For the first time ever, the Defense Department has a float. This will be a replica of the Korean War Veteran's Memorial in Washington, D.C.

Also, the Occupy Movement plans to have a float following the parade, featuring 15-foot high Mr. Monopoly character to represent greedy bankers.

I would like the shoe with the thimble more than the Monopoly guy.

(LAUGHTER)

But that's just my choice.

All right. Other news, CNN's chief medical correspondent Dr. Sanjay Gupta kicked off 2013 by taking part in the annual New Year's Eve Midnight Run in New York's Central Park. He was joined by other Time Warner employees and friends.

ROMANS: Ali was there -- no, he wasn't.

(LAUGHTER)

BERMAN: Dr. Gupta also led the Time Warner Fit Nation team in 2012 promoting the importance of physical fitness, and it is important. All right.

VELSHI: That is nuts.

(LAUGHTER)

I heard that he was talking about it yesterday morning. He was here with us. And I -- you know, I just -- I thought it was like the polar bear thing. I thought he had to run naked or something. I didn't realize he could wear his clothes. That takes a lot of the edge off the whole thing.

BERMAN: All right. There's really nowhere to go after that.

VELSHI: Right.

BERMAN: So I'll just say this. It is a new year so let's see what the weather holds today.

Karen Maginnis is at CNN Weather Center this morning.

Good morning, Karen. Help us out here.

KAREN MAGINNIS, AMS METEOROLOGIST: And good morning, guys. To you as well, John.

(WEATHER REPORT)

MAGINNIS: And to all of you in New York, happy New Year. To everyone else, happy New Year. It is a marathon, isn't it? Not a sprint. Right?

BERMAN: That's right. We're only in the first minutes of that marathon. Thanks for reminding us. We have a long way to go. But happy New Year, Karen. Great to see you this morning.

MAGINNIS: Happy New Year. Thanks.

BERMAN: All right. Other news. What did she do this year? So in case you missed any of the wackiness, the best of Kathy and Anderson in Times Square. That's up next.

(COMMERCIAL BREAK)

BERMAN: All right. Live from New York, it's New Year's Eve with Anderson Cooper and Kathy Griffin. The CNN anchor and his D-list diva rang in the new year again here on CNN. As usual it was anything goes. So check out some of the laughs by its greatest hits.

(BEGIN VIDEO CLIP)

KATHY GRIFFIN, COMEDIAN: Rihanna will be here --

ANDERSON COOPER, ANCHOR, "ANDERSON 360": Someone on Twitter was saying there's going to be drink game every time I giggle nervously.

GRIFFIN: Calvin Harris and Swedish House Mafia.

COOPER: Who is Calvin Harris?

GRIFFIN: OK, grandma. You know what? Let me take this part. Name Mitt Romney's sons.

COOPER: Tagg, Josh, Ben, Matt.

GRIFFIN: Yes.

COOPER: Craig?

GRIFFIN: Yes.

COOPER: Yes. Thank you.

GRIFFIN: You did it.

COOPER: Do we have the election night --

GRIFFIN: The election night photo.

COOPER: There's a photo that Kathy sent me on election night and told me to show it to David Gergen in the midst of our election coverage.

GRIFFIN: I love Gary Tuchman.

COOPER: Gary Tuchman is an amazing reporter. GRIFFIN: Obviously you are angry with him. To send him Ground Hog Day style to some sort of town in Maine where he drops a minnow in a bucket. Am I getting this correctly?

Ryan, Ryan, screw you. We do have better broadcast because we improvise and we're real.

COOPER: I was once doing a live shot with Paula Zahn.

GRIFFIN: Yes.

COOPER: And I was in Sri Lanka.

GRIFFIN: Yes.

COOPER: And a dog humped my leg. I just started giggling. Finally, I was like, Paula, I've just got to tell you, there's a dog humping my leg.

GRIFFIN: Is that how you (INAUDIBLE)?

COOPER: She did not --

GRIFFIN: And how are you?

COOPER: Hey, how's it going, nice to see you. Wow. I almost wore this, Psy. I was this close to wearing that.

GRIFFIN: This is not awkward at all.

COOPER: No, it's not awkward at all.

(LAUGHTER)

What was that?

GRIFFIN: That was MC Hammer.

COOPER: No. What -- really?

GRIFFIN: Yes. Yes. Babe. I got you babe.

COOPER: Babe, I got you babe.

GRIFFIN: I starting sexting George Stephanopoulos.

COOPER: Really?

GRIFFIN: Yes.

COOPER: I'm not the only one you (INAUDIBLE). Marissa says for a new year's present can Anderson get a word in edgewise every once in awhile?

GRIFFIN: I don't know what hit me. You're like Ike Turner. (INAUDIBLE) was so fantastic. COOPER: I didn't see it.

GRIFFIN: She had on the Joan Collins wig. Oh, my god, it was heaven on a stick.

(LAUGHTER)

COOPER: You hardly talk to me anymore.

GRIFFIN: You hardly talk to me anymore.

COOPER: I don't know --

GRIFFIN: When you come through the door.

COOPER: I don't know that.

GRIFFIN: At the end of the day.

COOPER: We'll check in with Gary Tuchman. He is. And we wish you a very happy new year of much success, and peace, and happiness, and love.

(END VIDEO CLIP)

BERMAN: That's right. Happy new year, everyone. EARLY START continues right now.