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Obama's Press Conference; President's News Conference Discussion; If Debt Ceiling Isn't Raised; Obama Talks Gun Control

Aired January 14, 2013 - 12:30   ET

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


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And ultimately, the way we're going to get stuff done, personal relationships are important. And obviously, I can always do a better job. And the nice thing is is that now that my girls are getting older, they don't want to spend that much time with me anyway, so I'll be probably calling around, looking for somebody to play cards with me or something, because I'm getting kind of lonely in this big house. So maybe -- maybe a whole bunch of members of the House Republican caucus want to come over and socialize more.

But my suspicion is, getting the issues resolved that we just talked about, the big stuff, whether or not we get sensible laws passed to prevent gun violence, whether or not America's paying its bills, whether or not we get immigration reform done, all that's going to be determined largely by where the respective parties stand on policy and, maybe most importantly, the attitude of the American people.

Now, if the American people feel strongly about these issues and they push hard and they reward or don't reward members of Congress with their votes, you know, if -- if they reject sort of uncompromising positions or sharp partisanship or always looking out for the next election and they reward folks who are trying to find common ground, then I think you'll see behavior in Congress change. And that'll be true whether I'm the life of the party or a stick in the mud.

All right? Thank you very much, everybody.

WOLF BLITZER, ANCHOR, "CNN NEWSROOM INTERNATIONAL": All right. So there he is, the president, nearly a one-hour news conference, wrapping through a lot of the most important issues on his agenda right now.

This is his last formal news conference, we're told, in his first term as president of the United States. The inauguration, the formal, official inauguration is coming Sunday, on Monday, all the pomp and ceremony here in the nation's capital.

The most important issue is the economic issue, the U.S. economy, jobs. The president stating firmly, forcefully, as he has before, he will not negotiate with Congress when it comes to raising the nation's debt ceiling.

What I will not do, the president said, is negotiate with a gun at the head of the American people, very strong words from the president. He was clearly frustrated, clearly angry at the Republicans right now, threatening, that he's not going to go ahead and let them do, let them try to use raising the nation's debt ceiling, raising the nation's debt ceiling as leverage in getting further spending cuts.

John King is here with us. Gloria Borger is here with us. Both of you stand by.

Brianna Keilar was at the news conference. She's over there at the White House. Brianna, the president was very tough in offering his assessment on what needs to be done.

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: That's right, Wolf. And he said he will not negotiate on the debt ceiling, the end. He has reiterated that and this was his chance to come out today and say it, yet again.

He said today that the United States is not a deadbeat nation and the point that he was making and I think we'll be hearing a lot more of, and we've heard some of in the past, is that he says this is spending that has already taken place.

He used an analogy where he talked about, you go out for a meal at the restaurant and then you don't pay the bill. He's saying this is the equivalent of that.

He was asked about the fact that Republicans, this really is one of their only cards to play at this point, but he said that it's irresponsible and it's absurd.

And he was also asked as well, Wolf, about a couple of other topics, of course, gun violence, where he seemed to indicate that he already had Vice President Biden's recommendations, that he should take -- we were expecting these to come to the president tomorrow, but he already has these.

He says he's reviewing them and he'll sit down with Vice President Biden, and that later this week, he'll be talking about the proposals that he wants to push. There's been some signs that the administration may not vigorously push for that assault weapons ban, that we know President Obama, at least in principle, supports, but politically would be a very difficult lift for congress.

He sort of sidestepped whether that was something that he was going to move forward, but said that there's a list of common sense proposals.

And finally, Wolf, he was asked just one question about this criticism that he's received recently, because of his top cabinet picks, really lacking diversity, being all white men. There have not been women among them.

He said, stay tuned for the other picks in his cabinet, that he thinks in the end, he will have continued his tradition of having women in the White House, in the White House and also on his cabinet. But for right now, some of that criticism still does persist, Wolf.

BLITZER: It does, indeed. Brianna, stand by. John King, the president said if the Republicans don't go along, social security recipients, their checks will go away, veterans' benefits will go away, inspector who is deal with loose nukes, they're not going to be able to pay the bills.

Investors around the world will lose their confidence in the U.S. economy and the nation's debt, as a result, will increase. Those are pretty strong words from the president.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Strong words, and many of them familiar, if you go back to this showdown two years ago.

And he also said one of the results of the showdown two years ago was the United States having its credit rating downgraded.

Look, there's no question. Repeated references to the election, I won, was the message. Even though the majority of House Republicans were re-elected, the president's message was, look at the polls, look at the elections, I won.

So, Wolf, clearly on this debt issue, the spending issue, he believes at the moment he has the high ground. He said he will not, quote, "let the Republicans collect a ransom," essentially get more spending cuts from him in terms of the debt ceiling negotiations. He wants to keep them separate.

Now, last time and he was asked about this, he did agree to negotiate. But look down at that fight. Look down at that fight for a minute. You cannot leave this news conference optimistic.

The Republicans are already issuing statements saying, sorry, Mr. President, we want more spending cuts. We want more spending cuts. So, they're at loggerheads.

Now, lift your head. Look to the second term, the debt ceiling, spending, debates with Congress, immigration reform, gun control. This shapes up -- if you thought the election was going to create this moment of let's get things done in Washington, it's clear from listening to this hour that the president and the Republican base are going to go this, this, this over just about anything you can think of.

GLORIA BORGER, CHIEF POLITICAL ANALYST: The president today was talking about today, we have to stop lurching from crisis to crisis to crisis, but what we got at this press conference was essentially a guarantee that that's exactly what's going to happen.

What we saw from the president today was sort of pre-outrage, setting the table before the Republicans get a chance to do that and, in advance of Republican action, the president called them irresponsible and absurd because he knows exactly what they're thinking.

I mean, he knows what happened on the fiscal cliff. He knows where they are on the debt ceiling and he made the argument today, and it's the bigger picture argument, which is, there is a difference between how Democrats believe government, what government should do, how large government should be, what it should do for you with Republicans who believe that they want a smaller, more pared down government.

That's the turf he wants to have this fight on. He said, look, we have to have a balanced debate, so you have a balance of spending cuts and a growth agenda. He's still talking about his growth agenda. Republicans don't want to hear that.

KING: They're talking separately. To get any of these hard things done, you have to have conversations. From the guns case, for example, they invite the NRA to the meeting. The NRA leaves the meeting. They are now clearly divided.

The president says he's not trying to take away anyone's Second Amendment right. The NRA says he's trying a direct assault on the Second Amendment.

Pick your issue. Pick your issue and we have confrontation not conversation which means we're going to carry this into the second term.

BLITZER: Dana Bash is up on Capitol Hill. Dana, I understand you're already getting reaction from the Republican leadership?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right. The House Speaker, first and foremost, this was clearly being written and it was sent the second the president walked out of the East Room.

Speaker Boehner saying that the American people do not support raising the debt ceiling without reducing government spending at the same time, something that we've heard him say time and time again.

He also says, the consequences of failing to increase the debt ceiling are real, but so to are consequences of allowing our spending problem to go unresolved.

He goes on at the end to say that the House will do its job and pass responsible legislation that controls spending, meet our nation's obligations and keep the government running and will insist that the Democratic majority in Washington do the same.

So, clearly, as you were just all talking about, another confrontational statement from the House Speaker. This is thing that House Republicans are -- have been trying to figure out amongst themselves, how far they can go, and you heard some of the questions to the president, some of the talking points that we've been getting all morning, from not just House Republicans, interestingly also from Senate Republicans, making the case that this whole idea of tying spending cuts or spending restraint to the debt ceiling is not new.

We've gotten several memos saying that in 1985, 1990, 1993, 1997, it was all tied up in the debt limit, trying to sort of put the onus back on the president, even though it was very clear, the president does feel that he has a leverage in saying that the Constitution states that it is the Congress that has the purse strings and it will be the Congress' fault or not if the nation defaults on its debt.

So, a very, very interesting response and, again, very interesting conversations being had. As we speak, there's a Republican leadership retreat going on in the House and, at the end of the week, there's going to be a full retreat of all House Republicans, conversations about just how far they are willing to go.

BLITZER: If anyone thought these days leading up to the second inauguration were going to be quiet and easy and just full of a lot of history and pomp and ceremony, they were clearly wrong.

Later in the week, the president said he'd be speaking out on the recommendations from the vice president on gun control in the United States.

Let's take a quick break. Ali Velshi is also standing by. We'll check in with him and get his reaction when we come back.

(COMMERCIAL BREAK)

BLITZER: We're back following the president's news conference, in which he said he will not negotiate with Congress when it comes to raising the nation's debt ceiling.

Strong words from the president, equally strong reaction coming in from the Republican leadership, the Speaker of the House, John Boehner.

Ali Velshi has been watching and listening. Ali, what do you think about this news conference and the immediate reaction we're getting? Because as you know, better than most, the stakes for the American economy, for the American people, indeed, the global economy, are enormous.

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Yeah, and I actually agree with something Gloria Borger said earlier, that this is actually more serious than the New Year's Eve/New Year's Day conversations on the fiscal cliff.

Look, the sad part is if you take it in context, there's a bit of a problem that the president and some of his then-colleagues in the Senate had when in '06, they also voted against increases to the debt ceiling.

So, it's been fashionable for some time to do this, to tie it to spending. It's -- he's -- you know, his analogies today were better, the idea that it's like going to a restaurant, eating all you want, and not paying the bill.

If you want to have a conversation in eating in a more modest restaurant or not going out to restaurants as much, that's a different conversation.

But, unfortunately, he has fallen victim to this himself. All of Washington has. He's right to take a strong view on this, though, Wolf. It was very, very damaging in August of '11 to have this conversation about not having the bills.

You can see there. The debt ceiling is at $16.4 trillion and we've breached it. So that's the problem. We do actually have to do this.

If we do default on payments, it won't be because the U.S. can't pay it. People are actually sympathetic about that sort of thing. Look at Europe. The issue is that we won't pay it, even though we can't.

So, the idea of holding payments for things that have already been incurred as hostage will have an impact on the interest rates that the United States pays to borrow money.

And, remember, we borrow a lot of money. When the 10-year bond yield goes up, the interest paid on 10-year bonds, it affects other loans that Americans take.

So, this could be very economically detrimental, right at a time when the U.S. is starting to make some economic strides.

The president's position is right, but history isn't on his side and Republicans aren't on his side.

BLITZER: Let me bring John and Gloria back to this conversation.

John, the Democratic leadership in the Senate, Harry Reid, Jim Clyburn, he just invoked the 14th Amendment. Forget about Congress and raise the nation's debt ceiling.

KING: It was pretty clear the president said this was up to Congress and he said that -- he used a more casual "dine-and-dash" analogy, if you will, but he kept putting this on Congress.

From everything he said in that news conference, it's clear he does not want to do that, and at least as of now, his public position is he's not going to do that, that he's going to leave it up to the Congress and, if the United States government has to shut down or if the United States government goes into default, he is going to blame the Congress. And again it's clear he believes he has the high ground here.

But to Ali's point about the bigger consequences, this is a president who, as he ends his first term, has to think about the second term and think about his legacy. As I just noted, clearly confrontation on immigrations, on guns, on this debt and spending issue, on his nomination for defense secretary. So if the president wants to start think about, what is my window to get things done, this is one of -- you could say they're not at all connected. How is immigration connected to this? How is guns connected to this? And yet they're all connected. The mood the Washington, the spirit in Washington, the willingness to get things done in Washington. The trust deficit is the biggest deficit in Washington, if you will, between he and the Republicans. So at some point he wants to watch this right now because he thinks the ball is in their court and the pressure's on him. But at some point, when does he become the president and try, even if he has to shake them, for his own good? Not just the country's good, for his own legacy to drag them across.

BORGER: The president asked sort of the large question, which is, what are we trying to accomplish here? If you are trying to get a grand, bipartisan deficit reduction plan as a part of some debt ceiling compromise, I think what the president is saying today and what we hear Republicans are saying is, forget it. It's not going to happen. The Republicans believe that they've already dealt with taxes. Part of any grand compromise has always been the question of tax reform, closing loopholes, lowering rates. When you talk to Republicans, they're like, we've had the tax conversation, we just want to have the spending conversation. The president is saying, you can't have one without the other.

BLITZER: And the conversation is only just beginning. The clock is clearly ticking.

BORGER: Right.

BLITZER: Guy, thanks very much.

Much more coming up here on CNN throughout the day. Our special coverage will continue with Suzanne Malveaux in the CNN NEWSROOM right after this.

(COMMERCIAL BREAK)

SUZANNE MALVEAUX, CNN ANCHOR: Welcome to CNN NEWSROOM. I'm Suzanne Malveaux.

President Obama spent the better part of the hour talking about the debt ceiling. So we're going to go into the details about what it is, exactly.

It is a cap on the amount of money the federal government may borrow. The cap is actually set by Congress. So it includes money the federal government borrows from the public.

For example, U.S. bonds, right? Also includes debt that the Treasury owes the government trust funds, like Social Security and Medicare.

Right now, the ceiling, is it set at almost $16.4 trillion. The country's borrowing already hit that mark. That happened on December 31st.

So the ceiling is raised periodically because both parties, they have to have approved the tax cuts and the spending increases over the years, knowing that they're going to add to the deficits. By doing so, they increase the country's need to borrow in the future. Since 1962, Congress has raised the debt limit 76 times, 11 times in the past decade.

I want to talk about the debate over the debt ceiling, how it affects the overall economy. Our Georgia Tech economics professor, Danny Boston, joining us.

Danny, you and I were listening to the news conference here. Obviously, this is a very important issue. And the president, he is not backing down. He says it is not negotiable here. What is the problem? What would happen if, in fact, they don't come to some sort of agreement? PROF. THOMAS "DANNY" BOSTON, GEORGIA TECH DEPT. OF ECONOMICS: The consequences are really enormous. And they are beyond, simply, the fact that we will default and not be able to, of course, pay our debt and have a downgrade of credit ratings.

MALVEAUX: Sure.

BOSTON: That's the short-term consequences, which will be significant. But the longer term consequences relate to, where will we be as a nation? Because the first time we had these problems, we kind of struggled through them, you know, in a messy way. The second time, the rest of the world will have the opinion that we're not capable of seriously dealing with these issues. And so it affects where will we be in terms of world leadership as an economy, whether the rest of the world will continue to use the dollar as a reserve economy. Where will Wall Street be in terms of his leadership? So it really, in the long run perspective, it really relates to where this economy will be from a global perspective and how the rest of the world, what their opinion will be.

MALVEAUX: So the president, he says, you know, it sounded very dire. Because he was talking about folks who were getting Social Security checks, they're going to be delayed their payments. People who -- regulators and inspectors who are looking for loose nukes are not going to get paid as well. That this is a dire situation. Do you think the president -- is that accurate? Is that really true that all those things might necessarily follow?

BOSTON: Every one of those things will follow. We are -- there are a lot of tricks that are being played to carry us to the point at which we have to make a decision. Once we reach that point, those bills can no longer be paid. And this is the issue that concerns me. I was not so concerned about the fiscal cliff as I was about the debt ceiling.

MALVEAUX: Why so?

BOSTON: Well, you see, this is really an historic opportunity for us. The fiscal cliff, the economy really was growing strong enough to get passed that. So we -- and we still have that strength. But we can't move beyond the debt ceiling issue. I knew that that would be a stopper. A game stopper. And so we have to address that now.

The conditions exist that there can be a grand compromise that will move the economy forward, or we can just go into free fall. For example, the last negotiation on the debt ceiling, well, the president, I thought, gave more than he should have given, but nonetheless, he did that. Now the onus is on the Republicans to come to the table because, see, what has happened is, tax cuts are essentially -- tax increases are off the table, right, and we got revenue from that. Not enough that we needed, but that's off the table. Well, that was a big issue for the Republicans.

MALVEAUX: Right. Danny, let's move on. Let's talk about the possibility of a government shutdown. The president seemed to indicate that it was, first of all, the Republicans' responsibility. That they were going to take the onus, the responsibility for this, and that it was potentially something that he was willing to allow happen, because he felt that most people will blame the Republicans. If the government shuts down, what does that mean for most folks? Because that is a lot of government jobs, a lot of people out of work.

BOSTON: Right. It means that people who get Social Security checks will not get those checks. It means that people in the military, defense, who are in Afghanistan, they won't get paid. It means all across the board and all kinds of institutions are dependent upon government revenue, those things will come to a halt. So there has to be a compromise. We just have to. I mean it's unthinkable that we won't compromise for (ph) this.

MALVEAUX: Hopefully they'll compromise. There's just weeks left. We are waiting. It seems like we're in the same position you and I were in just a couple of weeks ago. We were talking about averting the fiscal cliff. Hopefully we're not going to have to have that same kind of standoff. But it certainly seems like neither side is budging. We've also heard from the Republicans, their response as well. And they say, look, you know, we're sticking to our guns.

We're also going to talk to somebody who know all about finances, personal financial expert Suze Orman. She's going to weigh in, give us her tips on fixing the country's financial problems. That's going to happen in the next hour. Also your personal finances as well. We'll be back in a moment.

(COMMERCIAL BREAK)

MALVEAUX: President Obama talking about one of the most controversial issues that any leader has to deal with. And that, of course, is gun control. In his speech just moments ago, he invoked the Newtown shooting massacre and he talked about the push to tighten gun restrictions. Here's what he said.

(BEGIN VIDEO CLIP)

OBAMA: What's uppermost in my mind is making sure that I'm honest with the American people and with members of Congress about what I think will work, what I think is something that will make a difference and, to repeat what I said earlier, if there is a step we can take that will save even one child from what happened in Newtown, we should take that step.

(END VIDEO CLIP)

MALVEAUX: Want to bring in our Deborah Feyerick.

Deb, so the president already said that Joe Biden, the vice president's task force, that he's gotten a list of recommendations. We expect that they're going to be more specifics that are coming out later in the week. But there are two things that he seemed to indicate that he could do by executive order. And that is, one, try to track those guns that get in the hands of criminals or those who are mentally unstable. That there's some way that he can do that. And the other thing is really just making sure that the existing rules on the books are better enforced. I image that's probably good news for folks in that town, in Newtown, and others who have been pushing that.

DEBORAH FEYERICK, CNN CORRESPONDENT: Yes, and not just for the folks in Newtown, but really all across America. One of the things that you hear when, you know, gun control advocates speak, and that is that 33 people, on average, are killed by guns in the United States every day. And while the president was speaking, first of all, he said that he is planning on meeting with Vice President Biden later on this afternoon, just to go over some of the things that have been discussed. They'll have a larger meeting with more proposals later in the week.

But two of the things the president also hit on, he said the need for background checks on all gun sales, as well as banning military-type assault weapons and high ammunition magazines. That's magazines that are higher than 10 rounds per magazine. Those were two things that he really hit on during this press conference.

And while this was all going on, Suzanne, there was a big gun summit taking place at John Hopkins University. And the keynote speaker was Mayor Michael Bloomberg. He heads a coalition of 800 mayors across the country. He supported the two proposals that are before Congress that the president mentioned, but he also said that he believes that gun trafficking should be made a federal crime. Take a listen.

(BEGIN VIDEO CLIP)

MAYOR MICHAEL BLOOMBERG (I), NEW YORK CITY: Every day of the year, an average of 33 Americans are murdered with guns. Here's another way to think about what that means. One week from today, President Obama will take the oath of office for his second term. And unless we take action, during those four years, some 48,000 Americans will be killed with guns. Nearly twice as many people as were killed in combat during the entire Vietnam War.

(END VIDEO CLIP)

MALVEAUX: All right. Deb Feyerick, thank you very much.

I'm Suzanne Malveaux. President Obama using the bully pulpit, of course, to press congressional Republicans to raise the country's debt limit so the United States can pay its bills.