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Both Sides Talking But No Deal Yet; Debt Ceiling Hike Vote Could Come Today; Conservatives Rally Against Obamacare; Investors On Yesterday's Huge Surge On Wall Street; Shutdown Damaging to GOP

Aired October 11, 2013 - 13:00   ET

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


WOLF BLITZER, CNN ANCHOR: Right now both sides are still talking in the standoff over the partial government shutdown. The debt ceiling. Senate Republicans are at the White House. They've been meeting with the president. We'll see what they have to say. We're going to actually hear from one of those senators, Republican senators, who was in the room, standing by to speak with us, give us some details on what happened.

Also, right now we're waiting for today's White House briefing. It's expected to begin momentarily. We'll get the Obama administration's latest take on the search for a way out of this stalemate. We'll have live coverage. Jay Carney, the press secretary, getting ready to be questioned by reporters.

Also right now, conservatives are rallying here in Washington. Anyone who thinks they have for gotten about Obamacare needs to think again. We're going there for a live report.

Welcome our viewers. I'm Wolf Blitzer, reporting from Washington.

Will it be deal or no deal? That's the big question on this, day 11 of the partial government shutdown. This could be a crucial day in the fiscal stalemate. Senate Republicans, they came to the White House about an hour and a half or so ago, earlier in the day for talks with the president. As of right now, they're getting ready to leave the White House, we're told. Let's hope that's a good sign.

Talks yesterday with House Republicans were described as, quote, "good and useful." It was the first indication of at least some progress in this continuing stalemate.

Jim Acosta is over at the White House. Dana Bash is here with me in the D.C. studio. Jim, let's start with you right now. I guess the meeting has just wrapped up. These senators, we were expecting them maybe to come to the stake out over in the driveway outside the west wing of the White House. So far, they haven't shown up, right?

JIM ACOSTA, CNN POLITICAL CORRESPONDENT: That's right, Wolf. And I want to point something out. If you look over my right shoulder, you can see where some small buses have pulled up actually to the front -- of the front entrance to the north lawn of the White House, Wolf. That large portico is where the buses are parked just outside. We're expecting to see those Republican senators come out of the White House shortly. That is where they went in about 90 minutes ago. This is sort of a different set-up. And I don't want to get too bogged down in describing this, but -- than what we saw yesterday when House Republicans were going into that portico just behind the west wing.

This set-up today that the White House has put together along with Republican senators for this meeting is a little bit different and it -- I'm only pointing it out, Wolf, because it seems as if there may be -- and perhaps I'm reading too much into this. It may be a calculated effort here to sort of keep the senators away from the press, away from reporters. We're going to do our best to wave them over and see if they will come talk to us. But it's not the same as yesterday when we were coming they might come right to the stakeout position right outside the west wing, as is often the case with a lot these Congressional meetings with the president.

So, we're hoping to get some sort of indication as to what these Republican senators heard, what they had to say. We know they have their own ideas that are different, perhaps, than what House Republicans are proposing in terms of ending the government shutdown and raising the nation's debt ceiling.

As you also mentioned, the White House press secretary, Jay Carney, is going to get his briefing going here within the hour.

And, Wolf, just to give you a sense as to what we know so far right now. Basically, we are where we have been for the last 12 hours or so. There is progress in the fact that they are just talking but no breakthroughs have been reported yet. No breakthroughs have been relayed us to by White House officials, although I talked to a Democratic source who is familiar with that meeting last night between the president and House Republicans. And, as you know, Wolf, the president, as he was expected to do, made a very hard pitch to Republicans for reopening the government. My sense is, Wolf, he's made that same pitch to Senate Republicans in the last hour and half -- Wolf.

BLITZER: I'm sure he did. All right, stand by for a moment.

Dana Bash is here with me in our studio. Dana, there's some new information coming in on what House Republicans may be pitching.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right. And the headline is, it's not what the president wants which is immediately to open the government. This, I should tell you, comes by way of Congressional Producer Deirdre Walsh who has been doing some excellent reporting. And she's saying that the offer that House Republicans sent would extend the debt ceiling and vote on an extension of the debt ceiling first. Then --

BLITZER: For six weeks.

BASH: For six weeks, about six weeks. And then, after that, the House would sit down and start to figure out ways for them to come together to reopen the government.

That's pretty much what Republicans were planning on doing before they met with the White House yesterday, before they met with the president, I should say. So, they don't seem to have moved at all beyond the fact that they're actually exchanging ideas.

So, this plan, this idea is in the White House's hands. We don't know what they're going to say. If they're going to come back with a counter proposal. But we're trying to figure that out.

Peter Roskam who is a member of the House Republican leadership had told Deidre and others, let's do a temporary debt ceiling then let's concentrate on the continuing resolution.

We're also told that the vote on extending the debt ceiling could come as soon as today, even if they're going back and forth and starting to talk about reopening the government. They could start the ball rolling on the debt ceiling for lots of reasons, primarily because we're talking about next week that the debt ceiling is --

BLITZER: Well, let's say the House of Representatives today has a clean bill to extend the debt ceil for six weeks, until November 22nd, and it passes overwhelmingly. It goes to the Senate. Is it conceivable that Harry Reid would not allow that to come up for an up or down vote in the Senate?

BASH: He has been holding his cards very close to the vest for lots of reasons, mostly because things are so fluid. He doesn't know, kind of, where things are going to be with the broader talks.

But it is conceivable that he could hold it while -- in order to force the hand of negotiators to reopen the government. He has said -- in fact, you know, many people think he's been a big driver of this whole no negotiation strategy. He could slow walk it a little bit.

The other issue, by the way, is that you're probably going to need 60 votes on anything. And it's unclear if this would have 60 votes or, more importantly, if the bill to reopen the government would have 60 votes, because the other thinking right now is that perhaps if the Senate got a debt ceiling extension, then they could try to add a bill to reopen the government. Unclear of what that would look like. But as we've been talking about, we've been reporting, Gloria Borger and others, there are some ideas in the Senate floated by Republicans like Susan Collins on how to work out a bill that they could try to attach there.

BLITZER: Do we have any indications from White House officials, Jim, how they might react if the House of Representatives does vote in favor of raising the debt ceiling for six weeks, not including anything as far as the government shutdown is concerned but strictly dealing with -- dealing with the debt ceiling issue?

ACOSTA: Wolf, the president has said and I think Jay Carney has said repeatedly now that the president would sign a short-term debt ceiling increase. That was all contingent on what was in the legislation itself. It was a -- if it's a clean debt ceiling increase, he's going to sign it.

And I think the critical component in all of this, Wolf, is how close we drift towards October 17th. If we're drifting towards October 17th and we don't have a break through, we don't have a deal and he gets handed a deal that only raises the nation's debt ceiling, he is going to do that even if it does not include a bill that opens up the government. I think that is the best read on where the White House stands at this point. And that is a read I got from a Democratic official who was familiar with that meeting last night between the president and House Republicans. That the debt ceiling, yes, that is something the president would sign.

But he -- at this point -- and this was a surprise that came out of this meeting last night, Wolf, as to how hard the president is trying to push here. And I think it gives us a sense, at this point, that the president feels and the White House believes and I think Democrats up on Capitol Hill believe that they have a very strong upper hand here. They've seen some of these poll numbers that have come out that are very bad for Republicans. And they know they can squeeze just a little bit harder to see how much they can extract.

You know, what Dana said about that deal from House Republicans, I just don't know if that's going to fly, at this point, and what Susan Collins was proposing in terms of a medical device tax repeal as part of Obamacare, the presidents has said, he's not going to touch Obamacare when it comes to reopening the government and raising the nation's debt ceiling.

So, my sense is that and we're hearing that Rob Nabors, Denis McDonough, people inside the White House who are working on this deal, you know, they're going to be driving as hard a bargain as they can for this president at this point.

BASH: (INAUDIBLE) said one thing to what Jim is saying is exactly right. The pressure on Republicans in the House and especially the Senate to end this government shutdown is growing exponentially. That new "Wall Street Journal" NBC poll that came out last night hit, we are told, the Republican caucus like a ton of bricks. It really shows that the public, the vast majority, think that it -- this is the Republican's fault.

So, if, in fact, the House does decide, you know, let's just do this debt ceiling and start to work on a deal to reopen the government this weekend, they understand, Republican sources are telling us, that they're going to need to do that very fast. Maybe even as soon as getting a deal this weekend. So, we could see something move as -- almost as quickly as the president would want.

BLITZER: Well, we'll see what happens because these next few hours will be decisive, potentially, if there's going to be a deal today or tomorrow or Sunday. What we're going to hear in the course of today could be very, very significant.

Dana, thanks very much. I know you're not going to be going very far away. You're going up to the Hill right now, right?

BASH: Absolutely.

BLITZER: She'll be up on Capitol Hill. Jim Acosta will remain over at the White House for us. Jim, thanks very much to you. Investors, meanwhile, are following up on yesterday's huge surge on Wall Street even as they wait to see what happens today in Washington. Take a look at these latest numbers. Right now, the Dow up more than 100 points, 110 points, to be specific. Fifteen thousand two hundred thirty-five investors still upbeat about the prospects of a deal.

Take a look at live pictures we're going to show you from the White House right now. Today's White House press briefing with Jay Carney scheduled to begin any moment now. We're going to hear what the White House has to say about the just concluded meeting the president had with the Senate Republicans. All Senate Republicans were inside the White House. We're going to hear from that.

We'll also speak to one of those Republican senators who was inside the meeting, Senator Roy Blood from Missouri. He will be here with us. That's coming up this hour as well.

Also, we'll have a live report from what's called the values voters summit. Republican Senator Ted Cruz got a rousing welcome. He also got some heckling. We're going to tell you what happens. Stand by.

(COMMERCIAL BREAK)

BLITZER: Republicans may have dropped Obamacare, at least some Republicans, from their immediate demands to reopen the federal government, but the new federal health care program they love to hate certainly was front and center at today's conservative pep rally known as the values voter summit here in Washington. Republican Senator Ted Cruz of Texas was among those leading the charge.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ (R), TEXAS: And I'm going to suggest a model for how we turn this country around in the next couple of years. And it is the model we have been following together for the last couple of months to stop that train wreck, that disaster, that nightmare that is Obamacare.

(END VIDEO CLIP)

BLITZER: Our CNN Political Director Mark Preston is there at the event that's going on. Mark, any reaction to these latest round of White House talks to end the shutdown, raise the debt ceiling, and presumably not include any specific rewrites or changes to Obamacare, some of those proposals that are clearly out there?

MARK PRESTON, CNN POLITICAL DIRECTOR: Well, Wolf, I got to tell you, certainly the activists -- the grass roots activists that are here across town from Capitol Hill are not necessarily in favor of this grand bargaining or at least some kind of bargaining on Obamacare. They want to see Obamacare defunded. They embraced Ted Cruz' speech. They, in fact, took that and they used it as energy in really this movement against the whole health care system.

In fact, Wolf, this is what a piece of literature that we are seeing right now being passed around at this conference right there where you see a little bit of a match between the mix of policy and politics. And I got to tell you what though, Wolf, if there was anybody, at this point, who has really done well and has done well with this audience, it was Ted Cruz even when he was heckled. Let's take a listen.

(BEGIN VIDEO CLIP)

CRUZ: It seems that President Obama's paid political operatives are out in force today. I'm curious, is anybody left at the Organizing for America headquarters? I'm actually glad that the president's whole political staff is here instead of actually doing mischief in the country.

(END VIDEO CLIP)

PRESTON: And here you have Ted Cruz literally just one hour before he went to the White House for the meeting with President Obama. Now, those were not OFA, Organizing for America, workers. They were illegal immigration protesters. They had planted themselves in the audience. But, Wolf, how many politicians can stand on stage, can take that kind of heckling and use it as energy, use it as fuel to insight the audience? And that's exactly what Ted Cruz did -- Wolf.

BLITZER: Yes, he's a very good speaker indeed.

Paul Ryan, he's going to be addressing this conference as well. We remember his op-ed this week in "The Wall Street Journal" outlining a series of initiative to try to deal with the debt ceiling, the government shutdown. No mention of all of Obamacare in that article. What do we expect to hear today?

PRESTON: Well, you know, we certainly expect him to talk about the negotiations of standing by your values. But we won't see Paul Ryan here, as you said. In fact, a Family Research Council spokesman had told me that Paul Ryan was very clear for the past couple of weeks that if there was a government shutdown then, in fact, he would not be able to come here. They worked out a deal. So he'll do a five-minute video.

But, remember, Paul Ryan is known within the party as being the big thinker, as being somebody who understands the budget. So while he might talk about issues, social conservative issues, or mention them in, Paul Ryan's really his go-to is being able to balance the budget and to talking about policy issues that a lot of people can't do. I think that's what we'll hear from him today, Wolf.

BLITZER: Yes, he's clearly emerging as a major player in this effort to get the government back, operating fully and extend the nation's debt ceiling. He played a significant role, we're told, in the meeting that the House Republican leadership had yesterday with President Obama over at the White House.

Mark, we'll stay in close touch with you. Thank you.

Meanwhile, new polls show Republicans taking the biggest hit right now over the fiscal stalemate here in Washington. Our chief political analyst, Gloria Borger, she's standing by to join us next. (COMMERCIAL BREAK)

BLITZER: All right, the meeting at the White House is officially over. About an hour and a half or so, the president met with all of the Senate Republicans. They're now on their way back to Capitol Hill. We expect to speak live with Senator Roy Blunt of Missouri. He was one of those Republican senators inside, get his take on what was achieved, what wasn't achieved.

We're also standing by to hear from the White House press secretary, Jay Carney. He's scheduled for his daily press briefing. He'll be answering reporters' questions on what happened as well. Are we any closer to a deal? We'll find out fairly soon. Stay with us for all of that.

Meanwhile, both sides are talking in this fiscal showdown that has been gripping Washington, indeed so much of the nation. And that may be because of a reality check for Republicans. A new NBC News/"Wall Street Journal" poll show the Republicans taking the biggest hit so far over the standoff. In the survey, only 24 percent of Americans had a positive opinion of Republicans. The Tea Party had just 21 percent positive ratings. That's the lowest in this poll's history. Our chief political analyst Gloria Borger is here. She's been watching all of this.

I assume, Gloria, based on what you're hearing, this must be a wake-up call for a lot of Republicans.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: I think Republicans saw that poll yesterday and there was panic. You know, it doesn't take a rocket scientist to figure out. Another number in that poll was astonishing, which was that 70 percent of the American people, Wolf, believe that Republicans in Congress have put their own political interests before the interest of the nation. That is not a good number for anyone.

The irony of all of this, too, Wolf, is that throughout this controversy being -- talking about the shutdown, not about the glitches in Obamacare, the popularity of the president's health care plan has risen seven points in just a month. And you've got to say that's because of all of this.

BLITZER: Yes, despite the problems that have developed.

BORGER: Of course. Yes. But they've stepped on their own message, right?

BLITZER: Here's another number in the poll. The poll found most Americans totally fed up with Congress right now.

BORGER: Right.

BLITZER: Sixty percent say they'd vote to defeat and replace every member of Congress, including their own representatives.

BORGER: Now, they always say that, you know, and then they don't vote out their own representative because the districts are so gerrymandered and polarized. But what that shows you, Wolf, is that there is incentive, obviously, aside from the dangerousness of not raising the debt ceiling, there is incentive on both sides to get something done because if the economy tanks, there -- it's going to be terrible for all of them, including the president. So that's why the president, earlier this week, put his caucus on notice and said to Democrats, look, I may have to give John Boehner some kind of a fig leaf. And I think that's what's going on right now in the Republican Party. They're looking for a fig leaf here so they can go back to their constituents and say, this fight was not about nothing. It was actually about something. If it turns out to be about nothing, then they're going to have a harder time.

BLITZER: We see senators now leaving the north portico of the White House.

BORGER: Yes.

BLITZER: They're going to get on those buses to head back to Capitol Hill. We're hoping to speak with one of those senators, Roy Blunt, once he gets back to the Senate.

BORGER: And by the way, Republican senators - right. You know, Republican senators, some of them, are circulating other plans to try and get out of this. They were not on board, most of them, with the Ted Cruz strategy of attaching Obamacare to the continuing resolution to fund the government. So they're sort of fed up, along with a lot of other people, and they're fed up with some Republicans in the House. And so what I think you see now is, it's almost beyond a civil war in the party. I think you're seeing a party that's just kind of separating to a great degree.

BLITZER: I'm curious to see what, if anything, Senator Ted Cruz, who was one of those Republican senators at the meeting with the president at the White House, did he speak up, did he say anything, did he directly challenge the president?

BORGER: Right.

BLITZER: What was his role? Because yesterday Paul Ryan, when the House Republican leadership met with the president, Dana Bash was reporting, he played a significant role in changing the subject a little bit, maybe getting some progress.

BORGER: Right. You know, as Dana was reporting it, don't forget the president and Paul Ryan have a preexisting condition. They have a relationship. They've been in lots of budget sessions together. Paul Ryan, obviously, ran on the opposing ticket. But intellectually, I think, the president and he spar, but they respect each other to a great degree.

One thing on Ted Cruz that I would add, don't forget, there was a caucus of Senate Republicans in which Ted Cruz was chastised by members of his own party who stood up and said, you are appearing in advertisements that are running against us in our states. You are endangering our seats. And your strategy, such as it is, is endangering us and we don't see that you have a plan out of this. So it would be interesting to me if Cruz is vocal in this meeting with the president or whether he actually decides not to say much, because he could be jumped by his -- members of his own party.

BLITZER: He's a freshman senator, too, and it's not often they, the freshmen, they --

BORGER: He hasn't --

BLITZER: He hasn't necessarily respected that role, obviously. We'll see - we'll see if he had any private little face time with the president. You know, they both went to Harvard Law School. Cruz went to Harvard Law School four years after the president went to Harvard Law School, so they could share some notes about their three years of Harvard Law School.

BORGER: All right, well, let's see.

BLITZER: Maybe that - maybe that will be a bridge for the two of them.

BORGER: A bonding moment, right.

BLITZER: We'll see if they can do that secret Harvard Law School handshake or whatever they do there.

BORGER: Right. Do you know that? I don't know what.

BLITZER: Yes. Thank you, Gloria. Don't go too far away.

Also, still ahead, Republican Senator Roy Blunt attended today's talks with President Obama. We're expecting to speak with him once he gets back to the Senate. I think he's on one of those buses that just left the north portico of the White House. We'll get his take on what happened.

Also, Congresswoman Debbie Wasserman Schultz, she's the chair of the Democratic National Committee, and Republican Congresswoman Ann Wagner of Missouri, they are both here. We'll speak with them, get their different perspectives right after this.

(COMMERCIAL BREAK)