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AROUND THE WORLD

Interview with Senate Chaplain Barry Black; House to Offer Temporary Debt Deal; Interview with Rep. John Yarmuth; Government Shutdown Continues; Kidnapped Libyan Prime Minister Released

Aired October 10, 2013 - 12:00   ET

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


BARRY BLACK, U.S. SENATE CHAPLAIN: Senate, I would have responded, you did indeed inhale. But that was what happened because of optimism, because of persevering. There is an unstoppable law of sowing and reaping in the universe. And if you persevere, inevitably a productive harvest will come.

ASHLEIGH BANFIELD, CNN ANCHOR: I am going to put a picture of you up in my office and I want you to meet my children at some point. And I just want to personally say, thank you for being you and for joining us on the program today. Chaplain Admiral Barry Black, God bless.

BLACK: Thank you, Ashleigh. Thank you.

BANFIELD: Thank you, everyone, for watching. You should all put his photo up in your homes. AROUND THE WORLD starts now with Suzanne Malveaux and Michael Holmes.

SUZANNE MALVEAUX, CNN ANCHOR: You're watching CNN. I'm Suzanne Malveaux.

MICHAEL HOLMES, CNN ANCHOR: And I'm Michael Holmes. Thanks for your company today.

We do have some breaking news to begin with.

Just a few minutes ago, House Speaker John Boehner announcing Republican plans to offer a deal, an increase in the debt limit that would let the country pay its bills if only for another six weeks.

MALVEAUX: So during that time, Democrats would have to agree to negotiations on how to reduce the deficit. President Obama has signaled that he would be open to that.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R), HOUSE SPEAKER: The president is fond of say that no one gets everything they want in a negotiation. And, frankly, I agree with that, nobody gets everything they want. But over the course of the last 10 days, we've been trying to have conversations with our Democrat colleagues. They don't want to talk. The president doesn't want to talk. And we tried to offer bills that would reopen parts of the government, only to have them rejected by our counterparts over the United States Senate. So what we want to do is to offer to the president today the ability to move, a temporary increase in the debt ceiling, in agreement to go to conference on the budget.

(END VIDEO CLIP)

MALVEAUX: So there is a lot that is happening today. We're waiting for today's White House briefing that is expected to start any moment now.

We are also waiting for House Republicans, including Speaker John Boehner, they're going to go to the White House in the 4:00 hour to talk to the president, and the president invited the entire House Republican caucus. Boehner's office said only the leadership will attend that meeting.

HOLMES: Yes, the president also invited Senate Democrats to meet with him at the White House. That meeting is supposed to take place next hour.

MALVEAUX: We've got team coverage on this story. Joining us from the White House, Jim Acosta, Dana Bash on Capitol Hill, also Wolf Blitzer in Washington, Christine Romans in New York.

Want to start off with you, Jim, here because, first of all, this is -- it sounds very similar to what we heard from the president in his press conference, that there would be some sort of short-term deal when it came to raising the debt limit here.

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: That's right.

MALVEAUX: But this doesn't necessarily mean that there is not going to be a government shutdown during that six-week talks --

ACOSTA: That's right.

MALVEAUX: The period in which they negotiate. Is that - is that correct? Could we still be in this for the long term?

ACOSTA: That is the question of the day, Suzanne and Michael. And I think we're seeing a lot of fast moving developments right now. And so to really separate this out and unpack this, I think it's very important what you just said there, Suzanne. The president has said, and we're hearing from White House officials that the president will sign a short-term debt ceiling increase. That really takes the dynamite out of the room in the view of this White House. It gets the threat of default out of the room, off the table, moves it away from the current situation and then they can start working on how to get the government reopened again. I'm hearing from also some sources up on Capitol Hill that that is going to be amenable to House Republicans as well.

So, at this point, that is the question of the day, does the White House say, OK, let's do the debt ceiling deal now and we'll work on a continuing resolution to reopen the government later? At this point, what we're hearing from White House officials, Suzanne and Michael, is that the main requirement here is it is a clean debt ceiling deal, that it doesn't have any other partisan strings attached, doesn't deal with Obamacare, doesn't try to bring in other issues. And that once that is out of the way, they can start hammering out some sort of compromise on a continuing resolution to reopen the government.

However, let's make this very clear, the White House wants a clean, continuing resolution to reopen the government as well. So that may be the sticking point as we move forward. You mentioned that the House Republicans are going to be here later on this afternoon. My guess is and my sense is, from talking to various sources here at the White House and up on Capitol Hill, is that that is where the next I guess confrontation may lie. Once they get the debt ceiling out of the way, it's really going to be an argument over how to get the government reopened again.

MALVEAUX: And, Jim, real quick here, the president is meeting with Senate Democrats. He's also meeting with House Republicans. What does he hope to accomplish from these meetings by the end of the day?

ACOSTA: Well, what White House officials have been saying is that the president wants to meet with any and all congressional leaders and the main point, up until this point, Suzanne, from this White House, was that they are very, very concerned about the country going into default somewhere around October 17th. They don't want that to happen. They think it's a doomsday scenario. You heard the secretary of treasury, Jack Lew, on Capitol Hill earlier today saying that interest rates could rise, you know, your mortgage rates could rise, your 401(k)s could tumble, that sort of thing. That -- they want to get that out of the way so they can deal with this - this debate over how to reopen the government and what needs to be cut, what kind of compromise can be worked out somewhere down the road.

So that - I think that's where things stand right now. We're going to get a little more clarity, we think, in just a few minutes when Jay Carney goes to the podium at the White House Briefing Room. But that's where things stand right now. The president will sign a short-term debt ceiling increase according to White House officials. What happens next, we don't know.

MALVEAUX: All right, thank you, Jim.

HOLMES: Yes, Dana, let's go to you now. I suppose it says a lot that, you know, this, a postponement if you like, is good news. I mean, but a postponement is not a solution, is it?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Happy Thanksgiving, that's all I have to say to you because -

HOLMES: Well, happy Christmas by the time it gets sorted -

BASH: Exactly. But, once again, I just want to clarify that I'm getting from Republican sources here in Capitol Hill is, when we say a clean increase in the debt ceiling for six weeks, it sort of depends on your definition of clean. Jim is absolutely right, there is nothing about Obamacare, there are no, you know, extraordinary partisan conditions, except for this, this - what the House Republicans are proposing would be to increase the debt limit until November 22nd, but it would take way the Treasury secretary's ability to use extraordinary measures to kind of move things around. What does that mean in layman's terms? As one Republican source said to me, they can't monkey around. That this is a hard date. November 22nd would be a hard date for the Congress, for the White House, for everybody to have an agreement on what they're looking for, which are ways to ultimately long term bring down the debt and the deficit. As Republicans say, get away from the problems that got us where we are in the first place where we have to raise the debt ceiling to pay our bills.

So that is something that might be -- I'm not sure if it's a deal breaker, but it's certainly raising eyebrows among Democrats when they look at that because that is a condition. They also are going to say that the president must -- that Congress, I should say, must appoint budget conferees (ph), meaning negotiators, to sit down and work out a real budget and, as we've been report, that the president does have to sit down and start talking about ways to deal with the budget, specifically the funding of the government and how to reopen the government.

HOLMES: Yes, at least something's moving. Dana, thanks.

We're going to bring in Wolf.

MALVEAUX: Wolf, I want you to join in the conversation, if you will here. So, Wolf, talk about what this new deadline that Dana had mentioned, November 22nd. It's a little difficult not to be cynical, I think, for many people's point of view in believing that there is anything that is a hard date or a drop dead here when we've seen this ball move so many different times, we've seen the can kicked forward so many different types here. I mean do you think that there is something that is really workable, manageable, that the two sides can come together on, that the American people can believe?

WOLF BLITZER, ANCHOR, CNN'S "THE SITUATION ROOM": I think it's definitely doable. If there's a will, that remains to be seen. But there's definitely a deal there if both sides are willing to make some serious concessions and both sides walking away not with 100 percent of what they respectively have been demanding and willing to make some compromises.

There's definitely a deal. As I said, I don't think it's necessarily a done deal by any means, but kicking the can down the road six weeks is certainly reassuring to the markets out there, it's certainly reassuring to all the recipients, Social Security recipients out there. They're not going to have to worry, at least for the next six weeks, that America will pay its debt, American will pay all of its obligations. So that is encouraging.

You take a look at the Dow Jones. The markets are reacting very favorable to this indication of even a short-term deal on raising the debt ceiling. I think the markets are up over 200 points at least so far today, which is encouraging to the markets.

Look, there was a little blinking on both sides going on, assuming this short-term deal is accepted by the white house. On the republican side, they've walked away, in terms of raising the nation's debt ceiling for many of these earlier demands about specific changes to Obamacare or anything along those lines as far as the debt ceiling is concerned.

On the Democratic side, on the president's side, if he accepts this and if Harry Reid accepts it, they're going to have to do, in order to continue the negotiations over reopening the government, ending the government shutdown, they're going to have to do what Dana just told us about, this joint House/Senate conference committee, appoint conferees to talk about long-term debt and some of the other issues that they have to talk about as far as a budget is concerned.

Harry Reid had been reluctant to do it, even though the Democrats had been pushing it for months and months and months to have a House/Senate budget committee. The Republicans were reluctant to do it. Now the Republicans, in the face of the government shutdown, said they want it. Harry Reid said we'll do it, but only after you reopen the government and end the government shutdown.

So if they accept this notion for a House/Senate conference committee to deal with these issues, even while the government remains partially shut down, that would be a concession on the part of Harry Reid and the Democrats in the Senate. So there might be a little blinking going on, on both sides. I'm curious to see what Jay Carney, the White House press secretary, says on this sensitive issue, if the Democrats are ready to make that specific concession in order to extend the debt ceiling.

MALVEAUX: All right, Wolf Blitzer, thank you very much. We appreciate it.

And, of course, Wolf will be taking over coverage at 1:00 to continue all of this. And we want to also talk about what Wolf had mentioned here, the Democrats, potentially in a little -- in a small way blinking when it comes to this deal to negotiations.

HOLMES: Is that how they see it? Well, let's bring in Democratic Representative John Yarmuth from Kentucky.

And Thanks for being with us.

What did you make of what John Boehner's got to say, what might be on the table now?

REP. JOHN YARMUTH (D), KENTUCKY: You know, I think what we're seeing now is kind of an interesting dance where the Republicans met this morning, decided that they would take the initiative it doing what the president has already said he would do, which was say, we will end this impasse on the debt ceiling on a temporary basis if the president agrees to talk about some budget issues. And so I think they're going to go to the White House this afternoon and then the president will agree to negotiate with them, and then I think they will also make a deal on the government shutdown.

So I think we're just seeing an elaborate dance. Everybody's trying to feel like they take the initiative in getting things off of this impasse. But, ultimately, I think this will be a good thing. I'm kind of astounded for them to ask for a budget conference now. The Republicans, since we've been demanding that the -- Speaker Boehner appoint conferees to a budget conference for several months now. But finally we're going to get to do what we should have been doing a long time ago, and that's use regular order, the regular processes of Congress to reach a budget agreement.

MALVEAUX: And, congressman, are you worried at all here that this doesn't really adequately address the government shutdown issue here? That you could be in a period where you are talking back and forth, which of course is progress here, but the American people still essentially waiting for essential services for six weeks. How do you move that forward?

YARMUTH: Well, actually, I think that what I'm - I think we're going to see that within the next day or so. I think, again, Republicans will take the initiative on the debt ceiling and so we won't default on our debt, because that's the most sensitive and potentially catastrophic eventuality, and then they're going to meet this afternoon and I think again they'll say, OK, let's -- we'll reopen the government, we'll do a continuing resolution for six weeks, as well, match those two up, and tie them to the same agreement to do negotiations. The important thing --

MALVEAUX: Well, why are you -

YARMUTH: Go ahead.

MALVEAUX: I'm sorry. Why are you confident that that's going to take place? We didn't hear that coming from Speaker Boehner.

YARMUTH: I know, because, again, I think there's this -- a lot of posturing going on right now and I think he can't walk out and say, OK, we're willing to give up on the shut down and give up on the debt limit and we agreed to talk. So he's going to - I think he needs to go to the president today, the Republican leadership go to the president today, come back and say, we got the president to agree to negotiate, which is what the president said he's already willing to do. But I think they need to do that to make it look like they get a little bit of a win out of it.

HOLMES: Congressman, you know, big picture here. You know, if this is a delay, and we do this all over again in November, is there any conversation, to use the word of this crisis, happening about, is this any way to run a government, any way to run an economy? We're going to be talking about this in November, and then it's going to happen next year, it's going to happen next time around as well. Is this any way to run a government?

YARMUTH: Of course it's not. And again, we've been trying for a number of months now to get -- to use the regular process, the budget conference procedure to get a budget so we would avoid these kind of crazy - this kind of craziness and this kind -- this crisis - this crisis mentality. I think there is a huge risk, if this deal materializes where we reopen the government for six weeks and we extend the debt limit for six weeks. For Republicans to precipitate another crisis then I think would be absolutely fatal for them in the next election.

So I don't think they'll -- as the president said yesterday, I don't think Speaker Boehner will crawl up that tree again six weeks from now. And I think he makes a very compelling case that there's so much going on now, when you're seeing the U.S. Chamber of Commerce, the Koch Brothers, the Retail Federation, Federation of Independent Businesses, many corporate leaders and Wall Street all coming down on this saying that we can't - we can't continue this way, I think that's going to be somewhat of a safeguard that we're not going to end up here in the same way in six weeks. And I can see at six weeks' time saying, we're making progress, we're in conference, and then we will - so we'll extend the debt ceiling for six months or so. I think we can - I think this is a way out.

MALVEAUX: All right.

HOLMES: I'm sure the American people hope so as well. Representative John Yarmuth there. And the world, for that matter, who are watching this potential economic --

YARMUTH: Exactly.

MALVEAUX: And the one thing that he's going to have to do, and the Democrats are going to have to do, is Republicans are asking -- they are asking for tax reform, they're asking for entitlement reform. Those are serious issues that they're going to have to sit down and work through and see if there is any wiggle room between these two sides.

HOLMES: Can't keep doing this, you know?

MALVEAUX: Yes. And what it could mean for the economy, we're going to deal with that after a quick break.

Plus, we're also waiting for the White House briefing that is going to happen live moments live, moments away.

Stay with us here at CNN.

(COMMERCIAL BREAK)

HOLMES: Want to continue the conversation about developments in Washington by going to Christine Romans in New York.

Christine, I'm just right now looking live at the big board. It is up 1.6 percent on the day.

There are people who are saying that the market's not helping give a sense of urgency to those in Washington, because that's a big jump on any day of the week.

Why are they confident this is going to end in happiness and smiles?

CHRISTINE ROMANS, CNN BUSINESS ANCHOR: I think they're just happy at least the can is being kicked, and it's not just sitting there being argued about, right? Kicking the can down the road is enough for investors to say, OK, they're not going to be as stupid as we worried about. They will raise the debt ceiling.

HOLMES: Well, for six weeks anyway.

ROMANS: For six weeks, right,

There are plenty of people, though, who are also -- they are enthusiastic, even the conversation about a budget, actually putting spending and expenditure and tax priorities on the table between these parties.

Look, we haven't had a budget in the country since 20009. The reason we're fighting over the debt ceiling is because they haven't had a budget.

So they need this very serious discussion about long-term deficit reduction without hurting the country in the near term.

And I think everyone agrees except for a voices, a few lone voices probably speaking for political reasons, everyone agrees that if you don't raise the debt ceiling you can slam the economy into a recovery -- into a recession, rather, which is not what anybody wants.

Everyone in Washington wants to create jobs. They're just really arguing how to get there.

This is also, I would say, fragile because if this collapses or falls apart, meaning the deal, you could see stocks just as quickly move as swiftly in the other direction.

But just this week, you started to hear people say, wow, they might really, really take us to the brink here and that would not be good for business, it would not be good for Main Street.

MALVEAUX: So, Christine, it's amazing that the bar's so low at this point that we're celebrating this moment here.

But nevertheless, what does this new deadline mean for the economy, the state of the economy in the next six weeks?

ROMANS: I think it means more volatility. I think if it means a shutdown, you're going to be talking about a lot more people filing for unemployment benefits.

If the shutdown persists, and at this point -- correct me if I'm wrong, Suzanne and Michael -- at this point, it looks as thought this is about raising the debt ceiling and talking about, you know, some kind of a budget deal or continuing resolution. It's not about ending the shutdown quite yet.

And what that means is you'll have more people, federal workers, who will start to file for unemployment benefits, you'll have more of a kind of a, I would say, pullback in economic growth. I don't think -- I'm not calling for a recession because of the shutdown, but you will see economic growth slow as people are spending less money, as hundreds of thousands of federal workers are spending I less money and as the many contractors who rely on the government have less money to spend, you'll probably see more lay-offs among the defense contractors.

You know, the shutdown is hurting right now, so let's not get ahead of ourselves and say this is all unicorns and rainbows, because it's not.

This is just kicking the can, and that's worth a couple of hundred point on the Dow.

MALVEAUX: All right, we've got to leave it there.

HOLMES: Battered can, and it was interesting -- Christine, thanks so much.

It was interesting Europe, too. It's not just the U.S., Europe stocks were up a couple of percentage points on some of the major bourses there.

So, I like the way you put it. It's interesting. The bar is so low, this is like hey-hey.

MALVEAUX: We'll see how the White House responds to all of this.

There's a White House briefing that's going to happen momentarily. We'll bring it live.

And, plus, he was captured, then released. How armed men broke into a hotel, abducted Libya's prime minister.

HOLMES: Yeah, this as Libya's government questions the U.S. treatment of the suspected terrorist, Abu Anas al-Libi.

We'll be back with that as well.

(COMMERCIAL BREAK)

HOLMES: Welcome back, everyone.

A couple big things we're waiting for. The first one is the White House briefing. It's meant to get under way any time now, and it's going to be very interesting to hear what the White House has got to say about developments over at that place on right of your screen.

MALVEAUX: And, of course, big news coming out of the capitol, Capitol Hill there, when the House Republicans, the leadership, announced a possible deal here, a six-week extension, raising the debt level in exchange for negotiations, talks regarding the budget deficit, tax reform, entitlement programs, all of these kinds of things they want to put on the table there in exchange for lifting the debt ceiling for six weeks.

Obviously very important developments we're following throughout the day in the afternoon and two very important meetings that will take place between the president, senate Democrats and house Republicans in the hours to come.

And a very tense morning in Libya today, we're talking about the prime minister of the country, grabbed by men with guns, held for several hours.

HOLMES: That's right.

Now, during that time, nobody knew if Ali Zeidan was alive or dead or whether this was the start of a new wave of terror of targeting of government officials, those militias and their role of the running of the country.

Mr. Zeidan was let go by the militia group that abducted him. He's even downplaying what happened, calling it internal politics. It certainly is that.

Christiane Amanpour in New York. The interesting thing is here, this militia is actually part of the ministry of the interior.

So you've got a rebel militia group within the government kidnapping or seizing the prime minister. I mean, this is not looking good in terms of governance in Libya.

CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: Well, it's not, and it's part of an ongoing story and what Americans need to know is that this is really important because, of course, the United States, plus France and Britain and other NATO countries, you know, helped liberate Libya from the dictatorship.

But I spoke exclusively to the prime minister here in New York a couple of weeks ago, and he told me about the terrible situation with this, you know, militias run rampant and nobody really controlling them.

And listen to what he told me about the state of his state right now.

(BEGIN VIDEO CLIP)

AMANPOUR: Is Libya a failing state?

ALI ZEIDAN, LIBYAN PRIME MINISTER (via translator): The state of Libya is not a failed state. The state of Libya doesn't exist yet. We are trying to create a state and we are not ashamed of that.

The outside world believes that Libya's failing, but Libya was destroyed by Gadhafi for 42 years and was destroyed by a full year of civil war. And that's why we're trying to rebuild it.

(END VIDEO CLIP)

AMANPOUR: So there you had it from the prime minister's own mouth that this is not even a state yet. And we see it play out.

This is the highest profile of these kidnappings, but it's been going on for a long time, and people are saying this happens, you know, to high-connected people in Libya as well.

So it's just happened to the prime minister. He went on national television, really to try to calm international backers and say that this is not about targeting, you know, the U.K. or the U.S. or others, this is a domestic Libyan political drama fight.

But it really does point to how this had to how this has sorted out and, of course, the Libyans continue to seek support from outside.

We've had the secretary of state, John Kerry, the British foreign secretary, all pledge support and condemn this kidnapping. But it shows how difficult the situation in Libya remains.

MALVEAUX: Christiane, I'm curious, what is motive behind this?

Because you've got a number of developments just over last couple of days between the United States and Libya, you've got American troops that captured the al Qaeda terror suspect last week, and then you also Libya giving the U.S. tacit approval to hunt down the Benghazi suspects.

Do you think this was retaliation in some way?

AMANPOUR: Listen, it's really interesting because there's a lot of conflicting claims inside Libya.

Some are postulating it might be that. Some are saying that it was something specific against Zeidan, that these militias thought that he might some sort of financial irregularities. They didn't have any arrest warrant.

So it was informal what happened. You know the idea about -- I'm going to actually ask the foreign minister, who I've got on my program in less than an hour from now, what happened and how can you ensure that this doesn't happen again and why did it happen?

HOLMES: You know, the other thing, too, and for American audience, too, what we've got in Libya is really a series of fiefdoms around the country run by militias, disparate groups who didn't like each other before Gadhafi fell. They got together to get rid of Gadhafi.

They still have those old rivalries and tribal enmities, if you like. How do you bring that together?

AMANPOUR: It's really difficult. He was telling me, Prime Minister Zeidan, that they're trying, step by step, to create a central security apparatus, to create a central army to try to bring in some of these militias to respond in a national way and not in a tribal way.

But as you say, this is happening.