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Interview With Congressman James Lankford; Debt Deadline Looming; Obama Urges Lawmakers 'Do What's Right'; Two Girls Charged with Stalking after Driving Classmate to Suicide; Controversial Rape Case to Be Reopened; Interview with Senator Heitkamp

Aired October 15, 2013 - 22:00   ET


ANDERSON COOPER, CNN ANCHOR: Hey. Good evening. Welcome to "AC360 Later." We're live tonight from Washington, D.C., where the people who work in the building behind me are simply running out of time.

If you're keeping score at home, lawmakers now have about 26 hours until the debt ceiling deadline. It is a race against the clock in a route that has been littered with canceled votes, near misses and a whole lot of hot air.

This isn't just a leisurely jog in the park. There are serious consequences to not making a deal, a point that was hammered home yet again today, a warning from the Fitch rating agency putting the United States on notice that its credit rating is in danger of being downgraded because of all the potential brinkmanship that has the government now teetering on the edge of a possible default.

We're going to have more on that in a moment, but, first, late word tonight that after a planned House was canceled, a Senate deal could be close.

Chief congressional correspondent Dana Bash has new information about that potential deal, and chief business correspondent Christine Romans with what happens if a potential deal, like all the others up to point, completely evaporates.

Dana, let's start with you. What is going on right now?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, the Senate is actually still in session even at this hour.

I was just told before coming out to talk to you that it is possible for Senate Majority Leader Harry Reid to come to the floor before they close out for the evening and say at least there's a framework of a deal in principle. There are lots of reasons why they want to do that.


BASH: First and foremost, because of the markets tomorrow morning, of course -- in fact, Senator Chuck Schumer, who is still here working, senator from New York, made sure to tell reporters as he was walking into one of the offices just a few moments ago, actually explicitly said the markets sure know we are in really good shape. They need to know that we are very close.

What would the deal be? My understanding from Democratic sources is that they are going to give on something that Republicans have simply hated, and have been holding up the finalization of a deal in the Senate, which is to give something to the unions, their prime constituency. The unions really didn't like an employee fee as part of Obamacare. They were going to try to get it out. They gave in and said we're not going to do that.

COOPER: What would actually happen? OK, assuming a framework of a deal gets done tonight, what happens tomorrow? How does this play out?

BASH: There's so many different scenarios, actually not so many, probably two or three different scenarios. A lot of it is dependent on how willing to play ball some of the senators who have not been willing to play ball are, namely Ted Cruz.

COOPER: Right.

BASH: So assuming that they do formally announce the deal tomorrow morning, they file it, if the House sends them an expedited bill, it's a procedural way they could move faster. If Ted Cruz wants to slow the trains as much as he can, the final vote probably won't happen in the Senate until Saturday.

That would blow through the Thursday deadline, which is why you're hearing from lawmakers, don't worry. We have a deal, trying to calm everybody. If Ted Cruz and other senators, all 100 senators, say never mind, we know that this is going to happen let's just give in, it could happen as soon as tomorrow. Then, of course, the question is going to be at the end of the day, exactly what we have seen for the past two-and-a-half weeks, what happens in the House.

And our understanding is that finally John Boehner understands the clock is out. It's time. They are going to pass whatever comes to the Senate. And it will likely have to do -- he will have to do it the way he hasn't wanted to do it so far, which is with bipartisan votes.

COOPER: Right, which is something as you said he'd not been willing to do.

So is it possible they could still meet the deadline of midnight tomorrow?

BASH: It is possible. It is very, very difficult. It's going to be very hard for them to do that. Anything is possible. Look, when there's a will, and everybody wants to get something done, they can do it.

COOPER: Is it guaranteed, though, or there is no guarantee that House Speaker Boehner would bring it up for a vote?

BASH: There's no guarantee. But everybody who is close to him who I have talked to said it would be impossible to see him not doing that. Even today, as things were moving very fast, he said once again very clearly, he has no interest in this country defaulting.

He understands even if there are people in his caucus who don't really think this date is real, that Republican leadership understands that with the economy, particularly the global economy, perception is reality and the perception is that this date is real and they know that.

COOPER: Dana, appreciate the update. A lot to watch in the hours, really even after this program goes off.

Dana is going to be out with us throughout the hour if events warrant it.

Let's bring in chief business correspondent and "Your Money" host Christine Romans with more on what that possible downgrade from the Fitch rating agency actually mean.

So, what does it mean? It obviously could be very bad news for the U.S. economy if this actually was downgraded.

CHRISTINE ROMANS, CNN CORRESPONDENT: What it really means is that Fitch is saying that the United States Congress doesn't know how to run a business. We already knew that, right? This isn't a downgrade, it's a warning of a downgrade.

And also within that downgrade, or that warning, rather, it says it thinks a deal is going to get done. I'm watching the markets overseas and the futures markets right now. They're also having a pretty benign reaction overall tonight to the fact that it was a day that was wasted in Washington. I think what the markets are telling you is they think a deal just has to get done.

In terms of that October 17 date, if they don't raise the debt ceiling, does something happen immediately? Maybe not. Could there be a big stock market sell-off? Probably. And then after that, you start to see the cascading effects in the economy as the reality sinks in that America for the first time in history is going to have to pick and choose which bills to pay. And that could have a real dangerous, dangerous effect on psychology around the world.

COOPER: And I understand the shutdown, the fight over the debt ceiling, it is already hurt the economy. It's already hurt the economy.

ROMANS: It really has. You have people who aren't getting paychecks, hundreds of thousands of people who aren't getting paychecks.

When people talk about what could happen or what couldn't happen and doom and gloom and the Chicken Little scenarios and all this blaming about what a debt ceiling fight or a debt default would look like, it's already here. The shutdown has already cost tens of billions, maybe $20 billion in damage to the overall economy right now.

When you go back to the beginning of the budget battles, you have got jobs that have been lost, by some accounts, 800 to one million -- 800,000 to one million jobs have been lost simply because the budget fighting and the sequester and first debt ceiling fight and all of that nonsense.

This is already hurting. Main Street is already feeling this. And Washington just doesn't seem to get the message this is hurting all kinds of corners of the economy, not necessarily the markets yet, but it has already been hurting real people. And still that hasn't compelled a deal. It's concerning.

COOPER: Interesting. Christine Romans, appreciate the update. Thanks.

Joining me now is Republican Congressman James Lankford.

Congressman, good to have you here.


COOPER: What happened, first of all, in the House today when the vote basically evaporated?

LANKFORD: The Senate was trying to work on some sort of deal together. We were trying to do the same thing in the House, pull together a set of ideas to say, OK, what could we send over to the Senate first, be able to go from there?

We were not able to be able to pull that agreement together. Obviously, there are various folks, a lot of folks still very frustrated with the Affordable Care Act and what progress can be made. The president's made several comments about we know not everything's perfect, but we will just deal with it another time. Our concern is it won't be dealt with another time.

We're trying to find some things we can find agreement on and say what progress can be made.

COOPER: You don't believe that if the debt ceiling is extended, if the shutdown ends, do you believe that the Democrats would negotiate in good faith?

LANKFORD: We don't know at this point. We have sent over 40 different bills over the past three years dealing with the Affordable Care Act in some way, some total defund, which folks immediately come back and say it's not realistic.

Others deal with specific parts. None of those have been taken up by the Senate.

COOPER: But, for you, does there have to be a piece about the Affordable Care Act in any kind of deal?

LANKFORD: Well, part of the issue is, we're trying to rebuild trust with the president. This has been something over the last three years that has not gone great in a lot of our negotiations. We want to be able to start building some progress and say how do we fix this, how do we start moving forward.

Some of our negotiations have obviously been very heated. We want to be able to sit down at the table and be able to work this out. One of the ways that we propose to do that is say, let's take a little piece, something that the president and we can also agree has to be changed from the Affordable Care Act, because he keeps saying over and over again it's not perfect, it's not perfect.

COOPER: For you, what is a little piece?

LANKFORD: Well, there are several pieces. One that was a little piece that we had put out was the penalty, to just say to people the first year just like the president agreed with businesses and said for those businesses if you make a mistake or you can't get all the paperwork done, you are not going to have a penalty. We want the same thing for individuals as well.

COOPER: For Democrats, though, that's a big piece.


LANKFORD: It's huge for them. We also had put out just to be able to put members of Congress and the White House that we would be fully engaged in the Affordable Care Act the same as everyone else.

We threw that out today as a trial balloon on that. The president immediately came out and threatened a veto of that.

COOPER: What do you have to hear from the Senate bill in order to get your vote? Does it have to have something about Obamacare in it?

LANKFORD: It does. It does. It needs to be able to start moving us forward on that, because the issues are large. When we go back to the Affordable Care Act, we're not trying to be unreasonable about it. We understand the issues that are happening in the economy very well.

But I get letters from individuals that say their insurance last year was $200. This year, it's over $800. This is not a hypothetical thing, this is real for them. A small business that has 17 people, they have been in a group, just got a letter this week saying those groups are outlawed with the Affordable Care Act. All those employees are going to have to go in the exchanges.

They typically have provided all their employees this coverage. Now that coverage is now illegal for them. So there are real issues that are out there on the Affordable Care Act as well.

COOPER: The issue that the unions wanted, that some Democrats wanted that now seems to be out of the Senate bill, is that enough for you?

LANKFORD: That's one of the things. It's not only unions there, but there's a lot of large businesses. The concern for that when it came up originally was, the president's done a lot to be able to waive a lot of things for large businesses.

COOPER: Well, businesses over 50.

LANKFORD: Correct. For those businesses that are over 50, he's done a lot of things to waive the penalties for those the first year.

COOPER: But that's really only a tiny percentage of so-called large businesses.

LANKFORD: Correct. This is the same thing. It's what affectionately is called the belly button tax, to say if you work in this office, if you're in this union or if you're in this large company, you would then be exempt from this $63-per-person fee.

A lot of people don't know even companies that provide insurance will have to pay an additional $63 into the government as a tax to help offset others that don't, even outside their company.

COOPER: How hard is it going to be for you, for other House Republicans to go back to their constituents and say, look, we can't defund Obamacare, we cannot delay Obamacare?

LANKFORD: I don't think I will have to tell them that. I think they have already figured that out.

Obviously, watching this over the last four weeks as we have come up again and again and again to try to find any way to be able to help defend some of the folks, again, this goes back to the basic premise that we have. There are a lot of folks that say this will provide this great new thing that people haven't had and coverage and you can't lose your coverage and all those things.

That's fine to say. But there are also individuals that are being hurt by this. And we're trying to raise the red flag to say we can't just say this is all roses when there are real problems as well.

COOPER: So what happens tomorrow? If the Senate does have this bill, would you vote for it as you understand it exists now?

LANKFORD: We're going to have to take a look at it when it actually comes out from the Senate. Obviously, they're negotiating that. Still, no knows what that deals is at this point and be able to take a look at it.

But we will send it over to the House. I would assume there will be some sort of expedited procedures in the House, as well as there would be in the Senate. We will just have to wait and see.

COOPER: How concerned are you about what Fitch put out today about the credit rating, about the possibilities of defaulting? Are you one of the people who says it's not as bad as it's being made out to be?

LANKFORD: Well, let me give me two sides of that.

One is default is serious. But I don't believe it's the 17th. The Treasury has been very specific to say the 17th is when we're down to $30 billion. That may mean we have three or four or five days left on it. Obviously, we're very close to that point.

But you're suddenly tipping the 18th. Treasury has been really good about not trying to panic everyone to say the 17th at midnight everything falls apart on that. That's one side of it.

It's interesting. Two years ago, Fitch did not downgrade us because of the agreement we made around the debt ceiling. There was all the threats about the debt ceiling when we did the Budget Control Act that started bringing spending down. People forget we have gone from $1.4 trillion in overspending three years ago to $700 billion in overspending now.

The president likes to talk about he's cut the deficit in half in his presidency. What he doesn't talk about is, that was around an agreement on a debt ceiling last time.

COOPER: Are you saying you don't believe that they would downgrade us?

LANKFORD: No. I'm not saying that. I'm saying Fitch last time kept our AAA rating because of the Budget Control Act, because of the negotiations around the debt ceiling last time.

I do think they take it seriously, but they're not just saying you're intransigent because of all the political dynamics. Obviously, that's part of it. It's the fact that we have $17 trillion in debt. That's the biggest deal that we have. Whatever agreement that we come to has to start working on that.

COOPER: Congressman, appreciate your time. Thanks for being with us.



COOPER: Good luck tomorrow.

LANKFORD: Thank you.

COOPER: Let us know what you think. Follow me on Twitter. Use #AC360.

Up next, how all this drama is playing out in a certain building about half-a-mile from here, or I should say 1.5 miles from here -- reaction from the White House when we come back.


COOPER: Well, if you have been following the bouncing ball of the struggle to get a deal in Congress, you probably have whiplash about now. Right up until tonight every time a politician says they're close to a deal, there's another politician saying there's still a long way to go.



SEN. MARK PRYOR (D), ARKANSAS: I think we will get an agreement today. We're not there yet.

We're not there yet.

SEN. HEIDI HEITKAMP (D), NORTH DAKOTA: I think it's going pretty well. The adults have taken over.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: There have been no decisions about what exactly we will do.

SEN. JOHN MCCAIN (R), ARIZONA: A tentative agreement has been reached.

REP. CHARLES RANGEL (D), NEW YORK: This is not a compromise. It's a hostage taking.

REP. NANCY PELOSI (D-CA), HOUSE MINORITY LEADER: Why are they doing this to the American people?

SEN. JOHNNY ISAKSON (R), GEORGIA: There will be a deal, in my opinion.

REP. JOE BARTON (R), TEXAS: There will not be a vote.

REP. STEVE ISRAEL (D), NEW YORK: We're agreeing.

SEN. HARRY REID (D-NV), MAJORITY LEADER: This bill that they're saying over here is doomed to failure.


COOPER: Joining me now live, CNN political commentators on both sides of the aisle, Republican consultant Alex Castellanos and Democratic strategist Paul Begala. Also with me is Dean Clancy, the vice president of public policy for FreedomWorks.

Dean, appreciate you being with us.

Your group has put out an appeal to your supporters to contact their congressmen saying they should reject the bill the House was working on. What would you -- what is acceptable to you, short of a complete defunding of Obamacare or delay of Obamacare?


The Tea Party grassroots has basically heard the message from Washington. We have given up on a total defund. We know the president and the Democrats won't agree to that. We have even given up on a complete delay of the law. At this point, conservative Republicans and grassroots conservatives are saying let's fix Obamacare by eliminating its worst parts.

The worst part of all is the unpopular mandate, that penalty on people to buy health insurance. Our feeling is if the president's health care law is so great, why is it mandatory? Why not let people choose?

COOPER: For you, that -- any kind of negotiation has to occur before a shutdown is ended? It can't occur afterward? It can't occur after the ceiling is lifted?

CLANCY: No. I think the president could end this whole crisis tonight by simply accepting what the Republicans have said, which is we will talk about higher spending levels that Democrats really want, but the president needs to signal that he'd be willing to talk about postponing that penalty on individuals in the health care law. I actually think you would get a bipartisan compromise like that.

COOPER: Paul, what about that? Seem reasonable to you?

PAUL BEGALA, CNN POLITICAL ANALYST: No, not in this context, not with a gun to your head.

We have had debates about Obamacare, we have been debating it for years. It's the law of the land. Republicans want to end it or now change it. Democrat want to improve it and change it in some ways. There's a regular order to do that.

And it's simply wrong. The country is furious that we are holding veterans' benefits hostage and very soon Social Security checks won't be able to go out. Kids are getting kicked out of Head Start. Scientific research is being stopped, all because the Republicans are throwing a hissy fit about a law that passed three years ago. It just doesn't make any sense.


ALEX CASTELLANOS, CNN POLITICAL CONTRIBUTOR: Well, I hate to disagree with a fellow Republican or conservative. But when a warning, when your country is put on a warning list for its credit rating, it gets your attention. I think it's gotten the attention of a lot of Republican congressmen tonight and Democrats as well.

I take exception with Paul that this is only a Republican problem. When Democrats negotiate, it's called negotiations. When Republicans negotiate, it's called blackmail. But we're at a point now where I think you're going to see Republicans open up the vote on the House floor soon, this week.

COOPER: Do you think it was a mistake to tie all this to Obamacare before?

CASTELLANOS: I wouldn't have done that. We just don't -- the math doesn't work. We don't have enough votes to do that. As a matter of fact, I think it's pretty clear now that if we had stepped back and let Obamacare's miraculous rollout, that fantastic, well-choreographed rollout just get out there on its own, that would have done more damage and aided the cause of changing Obamacare or getting rid of it than anything we have done in the past few weeks.

Right now, I do think we have a solution, though, and it's border security. We put up a fence around the Mexican restaurant where Ted Cruz meets, and we keep him away from the Senate for a few days.


COOPER: Dean, what about that? What if you had just let this rollout -- you believed it's going to be a complete disaster. You would argue it's probably already been a disaster in the way it's been rolled out. So why not just let it roll out? And if you're correct, everybody will turn against it.

CLANCY: Well, because it's been a plied very unfairly.

Basically, all these corporate interests and now labor unions have gotten exemptions. The American people are the only group that haven't gotten an exemption. They ought to be free not to do this. But the fact is, in 2014, I think Obamacare could be a political albatross around the Democrats' necks. And they would be smart right now to share some of that blame with the Republicans.

COOPER: You say people are free not to get health insurance or should be free not to get health insurance. Don't we all end up paying for those people anyway?

CLANCY: Well, right now, the taxpayers do help pay for that and everybody does get health care one way or another.

Obamacare tries to fix -- tries to change the way everybody gets health care. But it does it in a way that disrupts the whole system, drives up costs. And as you have seen when the government tries to build a marketplace, it's a complete disaster.

CASTELLANOS: By the way, the Obamacare Web site was supposed to cost $90 million? It's cost $630 million.


BEGALA: It's going to be $6 billion in your next press release. That's not the problem.

The problem is we are risking the entire global economy because you guys don't like a health care bill that's already passed. That's crazy. We can debate this. You guys may have some good points about Obamacare. I probably have some good points about things gun safety that I think the Congress should pass.

(CROSSTALK) CASTELLANOS: You should have thought about that $17 trillion ago, but you didn't.


COOPER: Alex, you don't want to admit this, but you actually agree with Paul that this is not the way to go about it, to risk the full faith and credit of the U.S. government.

CASTELLANOS: I think it's a terrible idea. I think the Republicans are going to pay a big price in the short-term.

A friend explained to me today finally what Ted Cruz is doing. And I finally understand. He's having bunny sex.

COOPER: Wow. This is the late-night edition of 360.


CASTELLANOS: In nature, there are boom-and-bust cycles. The snowshoe hare every 10 years multiplies sixfold.

COOPER: Are you high? What are you talking about?


CASTELLANOS: I am high. Let me explain. Let me explain. Totally high. I wish I was.

The bunny -- the snowshoe hare -- I thought it's a marvelous explanation every six years -- every 10 years multiplies sixfold. Bunnies like sex apparently.


CASTELLANOS: But the boom produces a bust. They press their food supply. They invite predators. Right now, Ted Cruz, what he's doing feels good. He's growing his supporters. It's leading the Republican Party I think into a bust.

COOPER: You're digging a ditch, Alex.

CASTELLANOS: I love to dig ditches.


CASTELLANOS: It's a shovel-ready job.

COOPER: Go ahead, Paul.

BEGALA: We Catholics believe sex is a vile, disgusting act that we save...


BEGALA: ... and we never talk about in public. So, I'm a little -- I have no idea how to deal with the bunny analogy.

COOPER: Well, I don't even know where to go.


CASTELLANOS: Boom and bust. Don't you agree?


I think that's the Beltway perspective, which is some guy comes in from the prairie and says, you know what, this place is messed up. Let's do things different. And people react against that. I think Ted Cruz is a populist hero at the moment because he stood up and said basically the emperor has no clothes.


CASTELLANOS: There's a difference between doing things, advocating for change in Washington and doing it the wrong way.

Ted Cruz just drove the entire Republican Party through a car wash in a convertible, and everybody got wet but him. What he's done to the Republican Party is cemented us as the party of no, the party of no new ideas. Where's the change? Where's the optimism? Right now, we don't need a Jesse Helms; we need a Ronald Reagan. We have to see if Ted Cruz can step up and be that guy.

Where's the positive alternative that's going to lead the country forward, grow the economy? We have a better story to tell than Ted Cruz is telling today.

CLANCY: Right. And that's just what people said about Ronald Reagan in the late '70s, when the country was going to hell.


CASTELLANOS: No, actually not. Ronald Reagan was an optimist. Ronald Reagan said, there's a better way to go.

COOPER: But, also, Ted Cruz has been fund-raising on promising on something that he could not deliver and didn't -- and he knew he could not deliver. He knew he wasn't going to defund or delay Obamacare, correct?

CLANCY: Well, when you go into a negotiation, you always start with your big ask and you have to understand that the other side might respond.


COOPER: But do you think all the people who supported Ted Cruz and gave money, they all knew that this was just a hypothetical ask?


CLANCY: No. But the Tea Party grassroots is sophisticated enough to know that you don't get your way in Washington without moderation, compromise and negotiation. And that's what should happen now.


BEGALA: Here's what's missing in all this. There's real people hurting. There are small businesses that can't get loans, there's farmers who can't get loans, there's veterans who are hurting. There's real suffering because of a political stance. And that's wrong.

CASTELLANOS: And the president wants more of the same.

COOPER: We have got to take a break. Gentlemen, thank you.

Dean, thanks for being on.

CLANCY: Thank you.

COOPER: Alex, I'm still trying to figure out what the bunny sex was about.


CASTELLANOS: We will have a man-to-man talk later.


COOPER: Definitely did not learn that in my class.

It's said to be close. I'm going to speak with a senator to see what she can tell us about that next. We will be right back.


COOPER: President Obama today again called on Republicans to -- quote -- "do what's right," stop posturing, open the government and make sure the United States can pay its bills.

In an interview with CNN affiliate WABC, the president offered this reason for what's making negotiating such a struggle.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The problem that we have got is, is that for Speaker Boehner, for example, him negotiating with me isn't necessarily good for the extreme faction in his caucus. It weakens him. There have been repeated situations where we have agreements. Then he goes back and it turns out that he can't control his caucus.


COOPER: Well, CNN senior White House correspondent Brianna Keilar joins me now. So, I know we don't expect to hear publicly from the president certainly for the rest of the night. How is the White House reacting to the House Republicans kicking this crisis back over to the Senate?

BRIANNA KEILAR, CNN SENIOR WHITE HOUSE CORRESPONDENT: I think, actually, Anderson, they look at the Senate as a place where a compromise can be built.

The White House is very much in touch with Senate Majority Leader Harry Reid's camp. So I think they feel like they sort of have a hand in this, albeit sort of behind the scenes, that they -- and they have sort of more confidence I think in the situation in the Senate.

There is still, I will tell you, a sense here at the White House that a resolution can be found. The expectation, ultimately, White House officials will tell you over and over again, is that they think House Speaker John Boehner will have no choice but to swallow the bitter pill he's been avoiding, which is a measure that includes Democratic support, something that became pretty inevitable when his bill where he was seeking just Republican support, he failed to find the votes for, Anderson.

COOPER: And I talked to Christine Romans earlier about the psychologist impact of hitting that debt ceiling would be. How concerned is the White House? What have they said about it?

KEILAR: They're sort of I think downplaying.

There is a psychological impact. But I think that what really happens -- and I'm hearing this from key White House officials -- is that when we come close to that deadline, if things look good -- even though you have heard Dana Bash talking about we may not see a vote until Saturday, if things look good, there is a sense that the markets may not be as rankled as they could be. It's really the perception of how things are preceding.

And I'm told that the real problem is if we start to get into next week and there really seems to not be a solution in sight. That's when the wheels start really come off, Anderson.

COOPER: Next week. Brianna, all right, thanks. This story is changing by the minute. Let's check in again with our chief congressional correspondent, Dana Bash.

Dana, what are you hearing?

BASH: Well, we talked earlier about the fact that Senator Harry Reid, the majority leader, might come to the Senate floor. He did not do that. He, in fact, left and our eagle-eyed cameraman, Jane McMichaels, saw him leaving. I ran over and got him, actually, as he was getting into his car, asking if they have an actual deal. And he answered, "I think things are going to be good."

And then I asked if he is getting ready to have an actual announcement with the Republican leader, Mitch McConnell, tomorrow morning before the markets open, as Brianna was talking about, to make sure they're not rattled, so that they know that there is optimism. He said, again, "We're in good shape." So there you have it from the Senate majority leader.

And again earlier, Anderson, you and I talked about the fact that we know the outlines of this deal already, that Democrats are going to give in on a union provision that they were trying to get dealing with Obama care. They said they're just giving up on that in order to get the outlines of what they had already agreed on yesterday.

COOPER: Dana, appreciate the update. Democratic Senator Heidi Heitkamp joins me now live.

Senator, great to have you here.


COOPER: What do you make of what you saw today? I mean...

HEITKAMP: On Monday we were all optimistic. And I thought, "Are we really going to do this in some kind of timely fashion to get it done before Thursday? Which I think was possible on Monday.

And then we see this interjection of, "No, no, no, now let us do it" that happened over in the House of Representatives. And I think tonight we found out they can't do it.

And we're now a day late and a dollar short, because this is costing the American public money every time we have these little hiccups in our process. We know they are already discounting our debt, selling it off, afraid that they might not get their total cash. We already are seeing consequences in the market. And I think that this is now back on track. But unfortunately, we lost a day because of this.

COOPER: What will happen tomorrow? I mean, assuming that a deal is basically kind of hammered out tonight, is filed tomorrow, do you see this actually, what, going to the weekend? I mean...

HEITKAMP: You know, I think it's hard to know. I think some of this depends on whether the House and Senate can play well together. And whether we can get kind of a little shortcut by having the House send a message over so that we can avoid some of the procedural problems.

I think the wild card at this point is whether those folks who started this in the United States Senate are going to be willing to let this process be expedited and move forward as quickly as possible.

COOPER: There's a lot of Republicans who simply do not believe Democrats when they say, "Look, let's just --let's get the government working again. Let's get past this raising the debt ceiling, and then we can talk about things. We can have a conversation without guns pointed at people's heads."

HEITKAMP: But we're going to have to do that, Anderson. Because the C.R. is only going to take us through the end or the middle of January. We know that we're setting a deadline for when the budget needs to be established, which is in the middle of December. And so those two processes getting back to regular order.

You know, one of the things that I've been most adamant about, because I watch from -- as Joe Citizen as we saw one super committee or Bowles-Simpson and all these extra groups trying to come up with the deal. I'm saying, "Why don't you do it the way you're supposed to, in regular order with a budget, with appropriators, with people who know these budgets?"

And I think that there is a growing number of people on our side of the aisle who understand that we have some systemic work to do. We cannot continue to run up our debt and deficit. You know, just a 1 percent increase in our interest rate on the debt we have right now would be 110 billion a year, $1 trillion over ten years.

COOPER: But a lot...

HEITKAMP: We can't afford it.

COOPER: But a lot of Republicans point to Bowles-Simpsons, for instance, and say, "Look, the president set up this commission, bipartisan commission and basically ignored the results of it."

HEITKAMP: And who are those Republicans? The same Republicans who voted against it?

You know, at some point we all -- we all share responsibility for doing this. And I think that, from my conversations with a lot of people who are maybe on the more moderate specter, I came here to solve problems. And one of those problems is our debt and deficit. Moving forward we've got to get this done.

COOPER: OK. Assuming the deadlines are met, the shutdown is over, is there something you would be willing to have on the table from Obama care?

HEITKAMP: Well, I've said all along a lot of the -- a lot of the things that have been discussed very openly on the floor of the Senate, things like health savings accounts, reconnecting the consumer to the cost of health care, doing things with flexible savings accounts that were modified in Obama care. I think we haven't done enough cost containment of health care.

The president has said over and over again, we don't have a debt and deficit problem, we have a health-care problem. We pay too much. We think by the end of this decade it's going to be, you know, one -- 20 percent of what we do in our economy. That's too much. It's twice as much as any other developed country. We can't afford it, and we aren't going to be competitive if it keeps going this way.

COOPER: Do you believe we don't have a debt and deficit problem?

HEITKAMP: No. I think his point is that when you look at it and you see the big charts where the big red looming debt into the future, I always want to ask people, draw the line on what part of that is Medicare. What part of that is health-care costs. And we've seen that in terms of wage deflation when our wages don't cover. That's because health-care costs have gone up. And because housing costs have gone up.

Used to be a third of all of our costs we spent on -- of our disposable income was spent on housing. Now it's about half. And so the middle class is getting crunched, and we need to deal with these problems.

COOPER: Senator, I appreciate your time tonight. Thank you, as well.

HEITKAMP: Thank you so much. Great to meet you.

COOPER: Appreciate it. Thanks. Hope you get some sleep. Been a long day.

We're going to continue bringing you developments from Capitol Hill. Tonight we're also following, of course, other news. Police in Florida arrest two girls in connection with a bullying case. The victim, 12-year-old Rebecca Sedwick, took her own life. I'll talk to Rebecca's mother.

Also Missouri's lieutenant governor calls for a new review of evidence in the controversial case of sexual assault. Two girls said they were attacked, but charges were dropped against some of the boys. Could that actually change? New developments ahead.


COOPER: "Crime and Punishment" now. A county sheriff in Florida took the unusual step of arresting two girls, a 14-year-old and a 12- year-old, in connection with the bullying case that resulted in another 12-year-old girl committing suicide.

Rebecca Sedwick jumped off the tower of an abandoned cement plant last month after she was repeatedly bullied. The sheriff says what made him take action was an online message from the 14-year-old girl, posted over the weekend, a month after Rebecca took her own life. It said, "Yes, I bullied Rebecca and she killed herself, but I don't give a" -- and it uses an expletive.

The two girls are charged with aggravated stalking. Rebecca's mother had this reaction.


TRICIA NORMAN, REBECCA'S MOTHER: It's bittersweet. There's a lot of -- I mean, there's mixed emotions all around. I can't say that I want these girls to spend the rest of their lives in jail or spend any time in jail. But I do think they need serious rehabilitation.


COOPER: I spoke with Tricia Norman before today's development.


COOPER: I'm so sorry for your loss. Did you know that Becca was being bullied? Did you know what she was facing?

NORMAN: I knew she was being bullied while she was going to Crystal lake Middle, but after I started homeschooling her, I know it continued online for a little bit. And we deactivated her Facebook page.

COOPER: So you felt you were being proactive.


COOPER: You took her out of the school that she had been in.

Why were they -- why was she being bullied, do you know?

NORMAN: It was over a boy that she was dating as only 11-year- olds can date. One of her friends were sending him inappropriate messages, and she told her that she didn't want to be friends with her anymore. And they started calling her a goody two shoes, because she didn't agree with what was being said.

COOPER: And it wasn't just one child picking on her. It was as many as 15, I understand.

NORMAN: It grew. Yes. It was almost 20.

COOPER: Twenty. And Becca would -- would tell you or at least early on she would tell you about what was going on.

NORMAN: Yes. She stopped telling me about it in June.

COOPER: Did you think everything had sort of -- because she stopped talking about it that everything had gotten better?

NORMAN: Yes. Because her -- I mean, her attitude got better. She was getting back to her happy normal self. I mean, she was a little nervous going back to school, even though it was a new one, which I can't blame her. I mean, what she went through the year before.

COOPER: So you took away the cell phone, and you stopped -- deactivated the Facebook page. But there are other sites that she was involved with that you didn't even realize.

NORMAN: Yes. She had her cell phone, but it didn't have cell phone service on it. The only thing she could do was use Wi-Fi. And she had a text free app.

She eventually talked me into letting her have an Instagram. And I was like OK, well, they just post pictures on there. I'll just keep an eye on it.

I guess some of the kids that she started following had Kick. So she got a Kick. And then I guess somewhere along the lines it developed into that AskFM which I had never even heard of.

COOPER: And that's the thing. There are so many social media sites that parents just don't know about. They think Facebook's the only one but now there's all these others, and there are constantly new ones constantly popping up.

Did the bullying continue even after her death?

NORMAN: Yes. Pages started popping up on Facebook and Instagram, as a matter of fact, saying that she deserved to die. They were glad she was dead.

There was a girl from the old school, where she was getting bullied, that had posted on her Facebook that she was glad that she was dead. Another boy had stood up on a chair and acted like he was falling, said, "Oh, help me, I'm falling." And I was like, I just -- I don't get it.

COOPER: What do you want people to know about Becca?

NORMAN: She was a great kid. Sorry.


NORMAN: She was beautiful. She was smart, funny. She was always being goofy. She was always singing, dancing. She was just a great kid.

COOPER: I told you I lost a brother to suicide, and it was 20 some years ago. And still to a this day I sort of wonder exactly what was going through his mind. And you know -- and sometimes I feel like you can never really understand, that there -- you can understand situational things, but in those final moments what really was happening. Do you think about that still all the time?

NORMAN: All the time. Every night when I lay down I just why, Becca, why? I don't understand.

COOPER: Does it help to -- to be out there, to be trying to get this message out?

NORMAN: Oh, yes. That's the only thing keeping me going. She's left such a big hole in my life that I'm filling it with her still. It's never going to be the same, but it's the best I can do.

COOPER: You hope this helps other people?

NORMAN: Oh, yes. I would not want another child to suffer like Becca was obviously suffering. And I would not want another parent to go through what I'm going through. It's too difficult. It's too hurtful. Our life will never be the same again.

COOPER: Thank you so much for talking. I appreciate it.

NORMAN: No problem.


COOPER: Tricia Norman.

Just ahead Missouri's lieutenant governor calls for prosecutors to reopen a controversial case of alleged rape. The 17-year-old football star accused of raping a 14-year-old girl was not prosecuted. Instead, the town treated the girl like a villain, basically driving her and her family to move away.


COOPER: Another "Crime and Punishment" report now. Tonight Missouri's lieutenant governor is urging the state's attorney general and a county prosecutor to convene a grand jury to revisit a controversial case that was dismissed last year. He says the facts in the public record, quote, "cry out" for authorities to take another look.

When 14-year-old Daisy Coleman and a 13-year-old friend first said they'd been raped by two older boys, arrests were made within hours, charges were filed. But just weeks later, those charges were dropped. And that's when the town turned on the girls and their families. Gary Tuchman reports.


GARY TUCHMAN, CNN CORRESPONDENT (voice-over): I sit down with a mother and daughter who lived through a nightmare.

(on camera): Robin, when you found out what happened to your daughter, tell me what went through your mind.

ROBIN BORLAN, MOTHER OF PAIGE BORLAN: I was completely in shock and completely devastated.

TUCHMAN (voice-over): Her daughter Paige was a 13-year-old eighth grader when she said she was sexually assaulted by an older boy. She's now 15, has flashbacks, and hasn't gone back to school.

PAIGE BORLAN, RAPE SURVIVOR: I had started having a lot of night terrors, nightmares, flashbacks.

TUCHMAN: Another mother and daughter.

MELINDA COLEMAN, MOTHER OF DAISY COLEMAN: I just started crying. As soon as the doctor told us what had happened, I just started to cry.

TUCHMAN: Melinda Coleman's daughter, Daisy, was 14 and a freshman when she says she went out with her friend, Paige, on the same night to the same house and that she, too, was sexually assaulted, she says by a high school senior named Matthew Barnett, a star on the school football team.

DAISY COLEMAN, RAPE SURVIVOR: I began drinking from a bottle that they had given me. And they tried to get me to drink out of this large cup. It's like a large shot glass. And I drank from it. And that's all I remember.

TUCHMAN: Sheriff's department records show that both boys acknowledge having sex with the girls, but claim it was consensual. Authorities say a third boy took video of what happened.

And they believe that, although the girls had some alcohol beforehand, the boys worked to get them more drunk. Darren White is the sheriff of Nottoway County, Missouri.

UNIDENTIFIED FEMALE: You believe a sexual assault occurred?


TUCHMAN: The sheriff says all three boys confessed.

WHITE: Which is why that we were within four hours of receiving the call able to have people in jail.

TUCHMAN: The 15-year-old who was accused of sexual assaulting Paige was dealt with by juvenile authorities.

But 17-year-old Barnett and the teen said to have taken the video saw their felony charges dropped.

TUCHMAN (on camera): Have you ever been told by the prosecutor's office why he dropped the charges?


TUCHMAN: Not even today you don't know the reason?


TUCHMAN (voice-over): And then incredibly, people started ganging up on the girls. They found themselves shunned around town and at school. They were bullied in person and online. Daisy's mother was fired from her job. It was all too much for Daisy.

D. COLEMAN: Ultimately, I tried committing suicide at numerous amounts of times. And I did self-harm a lot.

TUCHMAN (on camera): I hope -- I hope you're better now. Are you?


TUCHMAN (voice-over): These families and others in the community think the prosecutor was pressured into dropping the charges because of political and social connections the suspects have. We, of course, wanted to find out why the prosecutor made the decision he did, particularly with what the sheriff said.

(on camera): Hi. I'm Gary Tuchman with CNN. We wanted to see if Mr. Rice is here. We're doing a story.

UNIDENTIFIED FEMALE: He's not available. TUCHMAN: He's not available for interviews? Does that mean he doesn't want to talk or he's not here? Or what does that mean?

UNIDENTIFIED FEMALE: He's not available for interviews.

TUCHMAN: He's not available? How come?

(voice-over): We still don't know if prosecuting attorney Robert Rice was there, but he didn't come out if he was.

He did release a written statement on this day, more than the mothers said they had ever heard. Rice writes, "There was insufficient evidence to prove a criminal charge beyond reasonable doubt. The state's witnesses refused to cooperate, invoked their Fifth Amendment privilege to not testify."

Melinda Coleman says that is not true.

M. COLEMAN: He wanted us to plead the fifth and sign papers saying that we wanted to. And -- and he wanted us to leave town.

TUCHMAN (on camera): So you're saying he wanted you to say you weren't going to cooperate?


TUCHMAN: So he wouldn't have to try the case?

M. COLEMAN: Correct.

TUCHMAN (voice-over): Melinda Coleman says she never agreed to that.

Meanwhile, a lawyer for Matt Barnett has released a statement. Robert Sun Dell says while his client admits the sexual encounter with Daisy Coleman, "the legal issue was whether a crime was committed. Subsequent investigation and interviews raised substantial doubt about the felony charge, specifically including whether the young lady was incapacitated during the encounter."

(on camera): Daisy Coleman and her family moved out of Maryville after this all happened. And they left so quickly they never even sold their house. And now they never will. Because this what is happened to it. Fire burned it down. The fire department says it has not determined a cause. But the family was and is suspicious.

(voice-over): For now, Daisy is in a new school and doing much better, she says. Her mother and Paige's mother are still hoping that someday they see justice.

R. BORLAN: She is my hero.

TUCHMAN (on camera): How does it feel to hear your mom say something like that?

P. BORLAN: Feels really good. (END VIDEOTAPE)

COOPER: Gary Tuchman joins me now from Maryville, Missouri.

Gary, now the lieutenant governor asked for the case to be reopened, could that actually happen?

TUCHMAN: It could happen, Anderson. It's a very unusual thing for a lieutenant governor or a governor to get involved. Lieutenant Governor Peter Kinder can't do this by himself.

But the fact that he's called for it is very symbolic. He's basically saying to the attorney general and to the prosecuting attorney here, "It's a good idea. Let's get it before a grand jury in this county."

And if they decide not to do it, they would be basically saying, "Lieutenant Governor," we don't want to do that. We don't care." So it's very possible that with the pressure from the state capitol here in Jefferson City, Missouri, that that could happen that this investigation could be reopened -- Anderson.

COOPER: Gary Tuchman, appreciate the reporting. Thanks.

Just ahead, millions of veterans may soon be facing serious hardships if the shutdown continues. Tonight an announcement about new hell that could be coming their way. A 360 exclusive next.


COOPER: Today here in Washington, not far from where I'm standing, nearly 100 veterans gathered at the national World War II memorial to protest the partial shutdown. They say more than 5 million vets may not receive benefits next month if gridlock continues. They could be left without money for rent, education and other critical expenses.

Private groups, though, have been stepping in to help, and tonight we saw it again. During our 8 p.m. hour the Wounded Warrior Project announced they will give $20 million to veterans if their benefit checks do not go out at the end of the month. I talked to Wounded Warrior executive director Steve Nardizzi about it.


STEVE NARDIZZI, EXECUTIVE DIRECTED, WOUNDED WARRIOR PROJECT: We work with over 40,000 wounded warriors and family members from these conflicts. Warriors who have severe injuries, burns, amputations, traumatic brain injury, combat stress, who rely on their disability benefits. And we know while we can't replace their disability benefits, we can at least provide them with some means of support to buy necessities, pay their bills, feed their family until this government shutdown ends.


COOPER: It's a big pledge for a very good cause.

That does it for us. Jake Tapper's "SHUTDOWN SHOWDOWN" continues our coverage.