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CNN LIVE EVENT/SPECIAL

Shutdown Showdown

Aired October 1, 2013 - 23:00   ET

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


(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN ANCHOR: Tonight, a CNN special.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: They don't get to hold the entire country hostage over ideological demands.

TAPPER: Washington, D.C., turning on the closed sign. With no give on either side.

REP. JOHN BOEHNER, R-OHIO, HOUSE SPEAKER: My goodness, they won't even sit down and have a discussion about this.

TAPPER: The House GOP's latest gambit -- funding the government one piece at a time.

UNIDENTIFIED MALE: How could a Democrat vote against that?

TAPPER: Just as long as one of those pieces isn't Obamacare. That strategy, like those before it going down in flames tonight in the Senate.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY FROM VIDEOCLIP: Even that proposal shows the utter lack of seriousness that we're seeing from Republicans.

TAPPER: Also tonight -

UNIDENTIFIED MALE: Welcome to Washington.

UNIDENTIFIED MALE: Thank you.

TAPPER: -- shutdown be damned, you try telling the greatest generation they can't visit their own war memorial.

UNIDENTIFIED FEMALE: Somebody moved the barricade. These are important visitors.

(END VIDEOTAPE)

TAPPER: This is "Shutdown Showdown." Good evening, everyone, I'm Jake Tapper. Welcome to this special half hour of CNN's "Shutdown Showdown." We're nearly a full 24 hours into this partial government shutdown and all sides have agreed to work out their differences and get things moving again. Just kidding. If anything, the rhetoric is even more intractable now that this has actually happened. Our polls show most Americans think the lawmakers on all sides of this are acting like spoiled children, which as a father, I might say is truly an insult to spoiled children everywhere.

They've all gone home for the night, having achieved nothing all day. In the latest move, House Republicans tried and failed to pass targeted piecemeal bills to reopen parts of the government if in the short-term, including national parks and claims processing at the Department of Veterans Affairs. The fear among Democrats seems to be the Republicans will try to fund the government piece by piece except for Obamacare which is of course what this really all about.

The shutdown did not stop the health insurance exchanges under Obamacare from opening as scheduled today, and aside from a few '404 not found' messages -- well, several of those actually -- people have been trying to sign up throughout the day. We've got lots to discuss and the American people want to know when this is going to end. I'd like to thank California congressman Kevin McCarthy for staying up late with us tonight. He is the third-ranking Republican in the House, the House Majority Whip. We're also joined by chief congressional correspondent Dana Bash and chief political analyst Gloria Borger. So let's get to it. Congressman, when is this going to end?

REP. KEVIN MCCARTHY, R-CALIFORNIA: You know, this is a battle that's been going on for quite some time. And I listened to what you said that today the votes failed. They didn't fail because of Republicans, they failed because of Democrats.

TAPPER: The piecemeal bills.

MCCARTHY: I don't consider funding the Veterans Administration, the GI bills as a piecemeal. I believe if there's elements of places of the government we agree on, then why punish them? Why when they had the World War II, why was the parks department ordered to shut it down? Those -- that greatest generation deserves to be saluted, not to meet barricades. The President is trying to punish the American public instead of solve this problem, and he'll negotiate with Iran, Putin, but he won't sit down and talk? And think of this -- if you want to question who shut this government down, Republicans never wanted to shut the government down and they funded the government. Time and time again. This was the last thing we asked for -- that individuals in America get treated the same as big business -

TAPPER: Delaying the individual mandate in Obamacare.

MCCARTHY: And making sure Congress and Senate and the Presidential live under the same laws when it comes to health care. And Harry Reid said no, and so we said then why don't we do what our rules say? If we have a difference of opinion on those few items, why don't we go to conference? And he said no and made a decision to shut the government down over this, which we think is wrong.

DANA BASH, CHIEF CONGRESSIONAL CORRESPONDENT FOR CNN: What do you think is more difficult -- negotiating with Putin or the Iranian president or as Republican Whip negotiating with your own caucus? MCCARTHY: Look, I know that makes good TV, but tell me why do you have 230 Republicans all voting the same way? I mean, you've got to --

BASH: Might be because of they're not getting anywhere -

GLORIA BORGER, CHIEF POLITICAL ANALYST FOR CNN: But it's not getting anywhere . I mean, I know it's not going anywhere in the Senate, so it's an easy vote for them, right?

MCCARTHY: Oh, no.

BORGER: Very easy vote.

MCCARTHY: Listen -

BORGER: Yes.

MCCARTHY: If you think from a prospect -- and most people don't watch -- the President has signed seven bills that have reformed Obamacare -- eight different provisions. Republicans and Democrats have voted for both. There are 70 Democrats that sit in the House today that voted to reform Obamacare one way or another. And the thing that I believe, when you go out to the American people they see the frustration. And one thing we have to realize -- 90 percent of every job created in America in the last year was part-time. Part- time because of Obamacare. That means part-time dreams -

BORGER: So why not do that -- I mean, here's -- you know, sitting out there -- why not OK, you want to reform Obamacare, you want to change it, there are things wrong with it. It just opened today, there are all kinds of glitches. Why not do that then and not do it the way you're doing it on a resolution to keep the government running that may go up against the debt ceiling? Why not just say, OK, we want to remove the tax on medical devices. Let's actually have a piece of legislation that does that? What would be so wrong with that?

MCCARTHY: It wouldn't because we've actually passed that -- but wait, let's deal with facts. We have passed that piece of legislation and Harry Reid wouldn't bring it up. Then when we passed no budget/no pay, they were forced to bring it up, and what happened? Seventy-nine senators voted for it. But Harry Reid wants to keep the tax on pacemakers. I think that's wrong. And when you ask why don't we go about it that way, that's exactly what we asked for -- go to conference if you have your differences -

BORGER; No, but before this.

MCCARTHY: What do you mean before this?

BORGER: Before this whole fight.

TAPPER: I guess the point she's trying to make is --

BORGER: Go (inaudible) for me, Jake. TAPPER: -- if you're interested in truly reforming Obamacare -

MCCARTHY: Yes.

TAPPER: Then there are other ways to do it and this doesn't seem like a good-faith effort to reform Obamacare. First you wanted to defund it, then you wanted to starve it in different ways -

MCCARTHY: We -

TAPPER -- as opposed to trying to improve it.

MCCARTHY: Oh, we've tried many different ways. But let's think of what Obamacare has done, OK? You're thinking that just Republicans are just doing this. The President has made the case for us -- ten times this year he's delayed one portion of Obamacare. Even last week while he was criticizing us for wanting to delay it, he was delaying it for small business (inaudible).

TAPPER: For the one-month (inaudible) web site.

MCCARTHY: Exactly. So he has acknowledged it has problems. Then the core of the problem is, it's fundamentally changing America. That now we're becoming a part-time America with part-time dreams. Because 90% of every job created is part-time.

BASH: You know, just sort of going back to the beginning of this -- it's not a secret that (Tom) Boehner and I'm guessing you -- you don't admit it here on live television, but nobody wanted to go down this road of tying -- defunding Obamacare, chipping away at Obamacare at all -

TAPPER: Boehner said it at a press conference -

BASH: He said it at press conference -

TAPPER: -- he doesn't want to (inaudible)

BASH: -- he doesn't want to do it. We know that he was fighting it. You guys drafted a bill that didn't include that behind the scenes. So my question for you is -- you're somebody who recruited a lot of the class of 2010 -- the ones who are being, you know, demanding that this be the strategy. Tell us why, I mean, what about these -- we know that they're -- you know everybody says that they're Tea Party-backers or whatever -- why is it so hard for you all who created this majority to control them?

MCCARTHY: I question even the idea that you're thinking they're controlling. Then why does a majority of Americans opposed to Obamacare? Why are the numbers continue to drop?

BORGER: No, absolutely -- and you all are really united on that --

BASH: And you all are really united on that. But the question is the strategy now on tying it to funding the government, which you all didn't want to do.

(CROSS TALK)

MCCARTHY: Well, no, people have the same goals, they have different strategies.

BASH: Uh hm.

MCCARTHY: You have a continuing resolution and you have a debt ceiling. Now, in a CR, if government shuts down ninety --

TAPPER: Continuing resolution that (inaudible).

MCCARTHY: Yes, 94 percent of Obamacare goes forward because that's discretionary money, and Obamacare is mandatory. Where you deal with mandatory within a budget? The biggest difficulty we have here is the President that won't engage. Why we stayed over the weekend to vote to keep the government open, he went golfing. I mean, that is a challenge and a problem -

BORGER: Can I ask you -- did you plan it this way? Or is this just -

MCCARTHY: Did I plan that Harry Reid would say no to -

BORGER: No -- is this a strategy that you guys planned or are we just making it up here -- watching you guys make it up as you go along, because that's honestly what it looks like. You know? To me.

MCCARTHY: Well, that's a fair question, but we think that Harry Reid would shut the government down because he didn't want Congress and Senate to live under the same laws -- that he wanted them to get a subsidy?

BORGER: Yes, but they're saying you shut the government down with the back and forth, and -

MCCARTHY: OK, then, then let's be fair with the facts. Who passed a bill that funded government and who just tabled it? That is a fundamental difference of where we go. And the President who says I won't even negotiate. Now, you've got 61 percent of America that believes the President should negotiate. You've got a $17 trillion debt. That is larger than our entire economy. You look overwhelming the American public wants something to change about that.

TAPPER: You're talking about polls, and I appreciate what you're saying, but the vast majority of the American people doesn't think that a shutdown should be tied to the fight against Obamacare. They think the government should be allowed to continue funding things. They disagree with the tactics.

MCCARTHY: OK, and that's fair, but that's exactly what we're doing. That's why we went to the floor today to make sure the Veterans Administration could process their claims, GI bills -

TAPPER: But isn't this -- isn't this strategy with this to piecemeal it until -- fine, I'll take away the word piecemeal -- to fund different parts until there's the only thing left is Obamacare, and then you just don't do that, then you move on to the next business. That's the fear that the Democrats have.

MCCARTHY: Well, why wouldn't rational people say, why put -- why inflict any pain on the American public if we agree with 95 percent of everything, then let's do that. Then the parts we disagree on, why don't we go sit in a room, have a conference the way the founders have created this. That's what we've asked for. It's only the Senate that's not showing up to do it. That's the challenge of where we are. And so, if they will not do it -- I mean, I'm shocked by the number -- we had three bills up -- a VA, we had the national parks and we had D.C. There are 15 Democrats that voted to fund D.C., but voted against funding the VA -- the veterans.

TAPPER: We're going to take a quick break. We're going to continue with that. Everyone here is sticking around. Coming up next, he was once shunned by his own party, and is his memory of exile one of the real driving forces between Speaker John Boehner's battle this time around? We'll talk about that next.

(COMMERCIAL BREAK)

TAPPER: He has seen the rise and fall of many lawmakers. In fact, he was one of them, so is the battle this time more of a personal one for House Speaker John Boehner? We will talk about that next.

(COMMERCIAL BREAK)

TAPPER: Welcome back to "Shutdown Showdown," I'm Jake Tapper. Speaker John Boehner brought three funding bills to the House floor and watched as each one went down in flames. It's just the latest battle for the House Speaker, who seems a little wary when it comes to taking on members of his own party. Maybe that's because in the past he paid a hefty price for being seen as doing just that. Let's bring in our House Majority Whip guest, Kevin McCarthy, Republican of California. Also joining us, chief congressional correspondent Dana Bash, and chief political analyst Gloria Borger. So, Congressman --

MCCARTHY: That's totally unfair.

TAPPER: What?

MCCARTHY: You make it sound like Republicans took down the bill. The bills were put on suspension so it takes a two-thirds --

TAPPER: It takes a two-thirds majority -

MCCARTHY: -- yes, so it was only the Democrats that took it down. Nancy Pelosi and Steny Hoyer were whipping --

TAPPER: I said that we watched as they went down in flames. I (inaudible) -

MCCARTHY: Yes, but you said he had problems. No, Republicans there voted for it.

TAPPER: Now we've clarified it for our viewers. They understand it was a two-thirds --

(CROSS TALK)

MCCARTHY: You've got to be very careful -

BORGER: Fact-checking here.

(CROSS TALK)

TAPPER: Fact check. The tables are turned. And we should also add that he will probably bring them up again tomorrow under normal rules -

MCCARTHY: We'll bring the rule, and they'll pass --

TAPPER: Under normal rules.

MCCARTHY: So the veterans of our country, those who are going out for disability, those that need a GI, those that are looking for home loans will be able to make sure -

TAPPER; And also I believe the majority leader Eric Cantor told you, Dana, that he would also bring one up for the NIH -- for the National Institutes of Health.

BASH: Right.

MCCARTHY: Yes.

TAPPER: Right, because there was that story in "The Wall Street Journal" today about people -

BASH: Kids with cancer -

TAPPER: -- needing clinical trials -

BASH: Right.

TAPPER: -- and being turned away because the funding wasn't there.

BASH: How many more of these do you envision?

MCCARTHY: I envision that we fund every portion of the government that we agree upon -

BASH: Except Obamacare.

MCCARTHY: Look, 94 percent are (go) -- why don't we get inside a room and why don't we have a discussion the way we're supposed to do it?

BASH: So let me ask you this -- let's just -- let's just pretend like that's happening in reality and not fantasy land.

MCCARTHY: OK.

BASH: OK. So, let's just say John Boehner gets in a room with President Obama.

MCCARTHY: Yes.

BASH: They work something out.

MCCARTHY: Yes.

BASH: If he comes back to your caucus and says 'here's what I worked out with President Obama,' he's gone.

MCCARTHY: No.

BASH: I mean, come on, that's the reality.

MCCARTHY: You guys -

TAPPER: (Inaudible) something, right, there needs to be something.

MCCARTHY: You get that -

TAPPER: Can't be a clean bill that he can't -

BASH: But that's what happened with (inaudible).

MCCARTHY: (Inaudible). Now, when you watch back in history, what happened about a month ago? Steny Hoyer first said he'd vote for a clean CR, I mean (inaudible), then he shifted and said they would not. They have been building up for a shutdown. And what did Harry Reid do? 'I won't negotiate with anything.' And the President -

BASH: Well then you played right into their hands

MCCARTHY: Well, OK. We have been -- why, we played into their hands because -

BASH: Yes, because -

MCCARTHY: -- we kept passing bills that funded the government? If we played in their hands, we would have not (inaudible).

TAPPER: But not with attaching defunding Obamacare.

BASH: Right.

TAPPER: You knew that that wouldn't make it to the Senate.

MCCARTHY: So we attached to end the tax on pacemakers which 79 senators voted for and Harry Reid -

TAPPER: I take your point. Let me ask you a question. So, a smart Republican I know says that one of the reasons that -

MCCARTHY: You don't think we all are?

TAPPER: You're all smart, of course. But when in particular that I know, I asked, well how come Boehner did in March he said we're not going to attach the spending bill to the defunding Obamacare -- we're going to keep funding -- fighting to defund Obamacare, but we're not going to attach it because that will lead to a government shutdown. Obviously, that changed, the position changed to the House Majority leadership. I said, so what's going on here? And this analyst said that what's going on is that the members of the Tea Party caucus in particular are very, very hepped (ph) up, they're very, very angry about Obamacare and they don't understand that this shutdown will ultimately be bad for House Republicans and they need to be shown like a parent would that if you touch the pot on top of the stove, it will burn you, and they're not there yet but they will see that ultimately. And what might be going on is House Republicans are waiting for these people who are pushing for this within your caucus to start hearing from constituents back home -- 'hey, I'm not getting this, hey, this isn't working, hey this is shutdown,' and ultimately there will be some sort of realization we need to come to an agreement.

MCCARTHY: Look, we will come to an agreement at the end of the day, but this is a much bigger issue. This is an issue for the direction of where this country's going to go. Are we going to continue to accumulate the debt we're accumulating, are we going to fundamentally change our economy for an economy that's growth? And I mean we have laid out a strategy that didn't build into the CR, that built in to where you dealt with the funding issue into the debt ceiling. But you can always argue why we're here, but that's too late. So let's understand which way to go forward.

BORGER: Can I just say, if you talk to Republicans not in the House --

MCCARTHY: Yes.

BORGER: -- and some Republicans in the House but also Republicans in the Senate, other Republicans, your former presidential candidate Mitt Romney, they're saying this is the wrong strategy for the Republican party. Your popularity now is an all-time low -- it's 17 percent, they believe that this isn't working for you and that it's just the wrong thing to do and you were making the wrong fight -

BASH: Which they agreed with because they didn't want to go to (inaudible).

BORGER: -- which you agreed with originally but now you're making (inaudible).

BASH: Thank you, Ted Cruz.

BORGER: So, it seems to me that there's a lot of people in the Republican party looking at House Republicans and scratching their heads and saying 'why are you doing it this way?' MCCARTHY: Maybe that's around the commentating table, but if you go out into America, you'll see a great deal of frustration. I mean -

BORGER: (Inaudible).

MCCARTHY: -- you don't have to go (inaudible), you could go to Jimmy Kimmel and they'll tell you that -- the problems they have. You could go on the internet today and find out you couldn't sign up for it because everything was breaking (inaudible).

BORGER: But aren't you stepping on your own message? Because you could have been talking about mostly that, instead you're talking about -- Obama -- you know, you're talking about shutting down the government and not the problems with Obamacare.

MCCARTHY: That -- OK, I want to be clear, though. We voted to fund the government each and every time. I never thought that Harry Reid would deny 79 members of his own Senate that voted for it before to stop the tax on pacemakers.

TAPPER: We have to call it there. Thank you so much (inaudible) late.

MCCARTHY: Thanks for having me.

TAPPER: And although not that late for your constituents back in California. House Majority Whip Kevin McCarthy of California, thanks so much.

MCCARTHY: Thanks for having me.

TAPPER: Dana Bash and Gloria Borger, please stick with us a little longer. When we come back, I'll ask you two to weigh on the question everyone is asking, just how long is this shutdown going to last? Stay with us.

(COMMERCIAL BREAK)

TAPPER: When will this end and how long does D.C. have before the people stop being polite? The over under is on the government shutdown when our special coverage continues next.

(COMMERCIAL BREAK)

TAPPER: Welcome back to our CNN special report "Shutdown Showdown." In case you somehow missed the clock, the federal government closed up shop just about 24 hours ago and that means many government workers are going to bed tonight worried about their paychecks. So, let's bring back Dana Bash and Gloria Borger. Your predictions, guys, how long is this going to last? Gloria.

BORGER: You go first, Dana.

BASH: OK.

BORGER: Passing the baton. TAPPER: Yes.

BASH: I think it's possible just a week but I think it's more probable that this bleeds right into the debt ceiling negotiations which is -- that's not until October 17th, so it could be a while.

BORGER: That's what I -- October 17 I think at a certain point the Senate is going to say 'you know what, if we're having one negotiation, we ought to have -- we just ought to do both at the same time.

TAPPER: That's only two weeks -- that's only two weeks and two days, I mean so -

BORGER: Exactly, so that's why they'll probably -

BASH: But of course.

BORGER: And the question is -

BASH: Only for people who (inaudible).

BORGER: -- I don't know if that's a good thing or bad thing. Because I don't know if they'd be more likely to actually get something real done or less likely.

BASH: There are no negotiations like none. Not on a principle level, not on a staff level, zippo (inaudible).

TAPPER: It's pretty stunning. Gloria Borger, Dana Bash, thank you so much. That's it for us. We'll have the latest on the government shutdown tomorrow at four p.m. eastern on "The Lead." "Crossfire" starts now.