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Senate Reaches Deal; Behind the Scenes at the Capitol

Aired October 16, 2013 - 14:00   ET


ANNOUNCER: This is CNN breaking news.

BROOKE BALDWIN, CNN ANCHOR: Wolf, thank you very much.

You're watching CNN's special coverage of the countdown to the debt ceiling deadline. We want to take a moment to welcome you, our viewers here in the United States and all around the world.

I'm Brooke Baldwin.

JAKE TAPPER, CNN ANCHOR: And I'm Jake Tapper, here on Capitol Hill.

October 16th, and the nation is on the edge of a possible default.

BALDWIN: Ah, yes. As we look at the calendar, we remember all the assurances, the promises that both the House and the Senate would get their acts together at crunch time. And it appears the Senate is now really taking the wheel. So right now, in this beautiful building behind us, a deal is now officially on the table. So that is definitely encouraging here. And in just about an hour, we should tell you, that the House, and specifically House Republicans, will be meeting to discuss that deal.

JAKE TAPPER, CNN ANCHOR: A very important meeting. We're not sure exactly --


SEN. HARRY REID (D), MAJORITY LEADER: It's never easy for two sides to reach consensus. It's really hard. Sometimes harder than others. This time was really hard. But after weeks spent facing off across a partisan divide that often seemed too wide to cross, our country came to the brink of a disaster. But in the end, political adversaries set aside their differences and disagreements to prevent that disaster.

SEN. MITCH MCCONNELL (R), MINORITY LEADER: For today, the relief we hope for is to reopen the government, avoid default, and protect the historic cuts we achieved under the Budget Control Act. This is far less than many of us had hoped for, frankly, but it's far better than what some had sought.


TAPPER: House Speaker John Boehner's camp says that they have not made a decision yet on how this will go in the House. It appears, however, that investors have faith, regardless. As news of the potential deal spread, stocks climbed, with the Dow adding nearly 190 points.

BALDWIN: So as we talk about the "d" word here, the deal, what's in it? Well, here it is, folks. Take a look with us here, the parameters that just might save the U.S. from what one lawmaker said, quote, is a "manageable catastrophe." I don't know if that's an oxymoron for some, but the government here, open for business immediately, funded until the 15th of January. As for the debt ceiling, it has been extended. That would put the whole thing really back on the back burner until February 17th. That hypothetical can we keep talking about the cliches, yes, kicked down the road again.

TAPPER: And here's an idea. Budget negotiators appointing folks who can actually sit down and talk to one another about long-term spending. And then, of course, there's the "o" word. You heard Senator Ted Cruz bring it up earlier. The only Obamacare related issue in this deal is income verification for people getting health care subsidies, to make sure that they qualify for those subsidies.

BALDWIN: So let's talk to our chief congressional correspondent, who has been busy, busy, busy inside today.

And it was such a pleasure sitting with you and we'll show sort of the behind the scenes piece in just a minute, but -


BALDWIN: It's great to be here on your home turf.

BASH: You too, Jake.

TAPPER: Thanks.

BALDWIN: Where are we right now? We talk about a deal. What does that mean?

BASH: What it means - what it means is that the Senate is getting ready to begin debate probably sometime in the next couple hours, we're told by this afternoon. And they will vote, unless something changes, we have to use the caveat -

TAPPER: Yes, seriously, knock on wood.

BALDWIN: Here's the caveat right now.

BASH: By sometime after dinner time. We don't know what that means exactly, but this evening. Then the question, of course, is the House. All indications are that the House will follow suit. That this will be a done deal, heading to the president's desk by this evening. But as you said, a very important meeting is going to happen -

BALDWIN: At 3:00.

BASH: At 3:00, which is in an hour, among House Republicans. So we'll see. But the key thing to remember is in the news is - and the reason why things can happen so fast is that Ted Cruz and his fellow conservatives who sort of started this strategy from the beginning, they say that they're not going to hold this up. They're going to allow this to go fast. They're not going to use any procedural tools to slow it.

TAPPER: And there were questions about that. Senator Ted Cruz, in no small part, helping to drive this standoff, saying - he had -- it wasn't an official filibuster, but he spoke for more than 21 or 22 hours talking about the need to defund Obamacare, the harm it was causing to the country, and pushing House Republicans to take the measure. But he has now said that he is not going to hold this up.

BASH: He is not going to hold this up. He said that privately to his colleagues in the Republican Senate meeting earlier today and he said it publicly. And, in fact, he came to cameras and I asked him about the fact that we are where we are despite what he put the country through and what he put his party through. Listen to my question and how he responded.


BASH: As you well know, you have a lots of fellow Republicans really downright angry at you because, here we are, almost three weeks later. The strategy that you started out on to defund Obamacare as part of funding the government, they never thought was going to work because the votes aren't there, and here we are reopening the government after a lot of bruising political warfare internally and you got nothing for it.

SEN. TED CRUZ (R), TEXAS: Well, Dana, respectfully, I disagree with the premise of that. I think we have seen a remarkable thing happen. Months ago, when the effort to defund Obamacare began, official Washington scoffed. They scoffed that the American people would rise up. They scoffed that the House of Representatives would do anything. And they scoffed that the Senate would do anything.

We saw, first of all, millions upon millions of Americans rise up all over this country. Over 2 million people signing a national petition to defund Obamacare. We saw the House of Representatives take a courageous stand, listening to the American people, that everyone in official Washington just weeks earlier said would never happen. That was a remarkable victory to see the House engage in a profile in courage.

Unfortunately, the Senate chose not to follow the House. And in particular, we saw real division among Senate Republicans. That was unfortunate. I would point out that had Senate Republicans united and supported House Republicans, the outcome of this, I believe, would have been very, very different. I wish that that had happened, but it did not. But it does give a path going forward that if the American people continue to rise up, I believe the House will continue to listen to the American people, and I hope, in time, the Senate begins to listen to the American people.


BASH: So you heard very unapologetic about his strategy.

TAPPER: At least in public.

BASH: At least in public. But I - you know, I think politically as well. I mean, Jake, we've talked about this a lot. He has now become a hero among many conservatives.

TAPPER: Oh, sure.

BALDWIN: Uh-huh.

BASH: Among really the grassroots out there who matter -

BALDWIN: Making a lot of groups a lot of money as well.

BASH: Right, who matter a lot in Republican Party politics, in primaries around the country, but also in states like Iowa and New Hampshire -


BASH: That tend to elect Republican primary - Republican presidential candidates, rather.

BALDWIN: OK, Dana Bash, thank you. We'll be watching for you.

And again, that House Republican meeting happening in less than an hour from now. Dana Bash, thank you.

TAPPER: I want to bring in Congressman Lankford right now, because tonight one certainty is the GOP is taking the biggest hit in the aftermath. If you look at "The Wall Street Journal," which is, of course, seen as somewhat conservative, the editorial page, wrote after House Republicans failed to vote on a bill last night, quote, "Republicans might as well hand the speaker's gavel to Senate Democratic Leader Harry Reid. It editorial then ends with, quote, "Republicans can best help their cause now by getting this over with and moving on to fight more intelligently another day."

So we're going to bring in Republican Congressman James Lankford of Oklahoma.

First, congressman, your position on the deal? Can you vote for this compromise that Harry Reid and Mitch McConnell have put together?

REP. JAMES LANKFORD (R), OKLAHOMA: Actually, I'm still looking forward to getting the chance to go through. I haven't had the opportunity to be able to see it all yet. I've heard a lot of the outline and the framework. Shockingly enough, there are occasionally times when a Senate proposal comes over with a couple extra non-germane items that are added to it. So I want to get a chance to take a look at it before we go from there. Then we are looking forward to the conference at 3:00 today.

TAPPER: Assuming it is - I'm sorry, assuming it is as has been described, so -


TAPPER: With the caveat that - that -

LANKFORD: I've still got to look at it, Jake. I really do. I'm sorry, look, it shouldn't be long. It should be straight-forward. But I want to get a chance to take a look at it to know where we're going from there.

BALDWIN: So we know that the meeting is happening at 3:00 today. Can you just take us behind closed doors -


BALDWIN: And explain as best as you can, what's happening right now on your side of things?

LANKFORD: Yes. Folks will, obviously, get a chance to get a copy of it, start looking through that. We'll meet at 3:00. We'll talk through the parameters. They'll talk through what's happening over on the Senate side in the schedule. The speaker will outline, here's what this deal is, here's what it's all about. Majority Leader Cantor will step up, kind of explain where things are as well, and then we'll have some interaction among everybody and everybody will have a chance to be able to visit on that.

BASH: You have no -- you have no doubt that the speaker will bring this to the floor?

LANKFORD: I don't have any doubt that he'll bring it to the floor.

TAPPER: As is?

LANKFORD: As is. Yes, I don't have any doubt on that. Obviously the speaker can choose to do that, but I've got not heard any rumblings from anyone at this point that he's not going to bring it to the floor.

TAPPER: Are you concerned at all about how these last three weeks have played out for the Republican Party brand?

LANKFORD: Sure. Yes, it's a - it's a difficult season for us in the conversation. We're responding to a lot of e-mails and letters and phone calls that we get right now from people that are writing up and saying, my premiums are going up or my business is going to stop or a letter that I just got this last week from a small business -- my district has 17. They used to group together with other small businesses to form one plan. They just got a letter saying that plan is now no longer legal under the Affordable Care Act. They're going to have to either go on the exchanges or find some other insurance options. All those things are happening right now in the heat of all this as people say to us, get the government back open. We want to get this resolved. At the same time, we're getting responses from people saying, oh, I've just figured out what this fight is about. And so it's a real odd time and awkward (ph). BALDWIN: How do you assure those people? How do you assure those people who call you and write you the letters, because let's face it, your side lost, and who knows how many Republicans are re-elected, especially those on the far right, the left. And when I say left, more center Republicans could be elected instead.


BALDWIN: What do you say to those people who say, I'm disappointed?

LANKFORD: No, I - that's exactly what I say. We're frustrated, we're disappointed. The president has said over and over again that he wants to talk about these things, he knows the bill's not perfect. We just never seem to get to that moment. For the last three years in the House, we've passed different pieces, over 40, that have either been defund or that have been total ban, and everybody always laughs at all those.

I understand the media and they say that's never going to happen. And then we start walking through specific things that we see as a problem. The Senate never takes it up. The president never talks about. Even when we got in these negotiations, he said I won't negotiate, we'll talk about it some other time.

The problem is, the pressure has built up for three years. As we've said, we believe the problems are real and we do have to deal with this at some point. And now we've got to actually get past this deadline and then to find out if the president's serious about this.

TAPPER: Congressman, just very quickly, how do you think the last three weeks would have played out if you and your party had not done what you did and instead the American people were focused more on what seems a less than stellar launch of the Obamacare websites?

LANKFORD: Yes, I'm not sure the CNN folks have been yet to be able to register on it, de able to walk through and actually do the whole process on it.

TAPPER: No, we -

BALDWIN: I believe Elizabeth Cohen finally got in.

TAPPER: She got in?


BALDWIN: But to your point, it's been difficult. And that has not been above the fold.

LANKFORD: Every single day trying to get onto it. The problem is, the problem with Obamacare really aren't the website. That's just a symptom of a larger issue. You can go to every hospital, you can go to every doctor's office right now, you can go to every individual that's trying to walk through the process and say what's legal and what's not illegal? Businesses restructuring. The most extreme case in my district is a family that has three franchises. Those three franchises together provide them enough income to be able to support their family. But if you separate them out, they can't. They can't keep those three franchises, though, together because with them together, they have over 50 employees. And the hit that they'll take it more than their profit margin. So they are actually looking at divorcing, still living together, so that legally one person can have one of those, the other person can still have two, only because of the Affordable Care Act. That is the most extreme example, but I'll tell you, that's the real-life stuff that's happening right now as people try to figure out -

BASH: The stories that have been buried under the - under the government shutdown.

LANKFORD: That's exactly right. Those stories will continue to rise up when we talk about -

TAPPER: We want to get the information from your press secretary about that couple and find about -

BALDWIN: That's quite a story.

TAPPER: That's quite a story if it is as advertised.

LANKFORD: Very - very, very difficult decisions are going on right now and the problem is - and there's been all this fight about it. In the days ahead, you talk about what's going to happen long term.


LANKFORD: Well, you tell me how this is going to continue long term? Is it really going to work? Because, at the end of the day, people look back and go, maybe those guys were right. I didn't like how they did it, but they might have actually been right on that. It (ph) might all turn around.

BALDWIN: We'll have to end on the question. Congressman Lankford, thank you very much.

LANKFORD: You bet.

TAPPER: Thanks for coming. Good to see you again, sir.

BALDWIN: Dana Bash, thanks to you as well.

BASH: Thank you.

BALDWIN: So, to his question, what is next, right? We're going to get right back to this point here, months from now. So coming up next, we'll talk live with one economist who says President Obama's victory comes at a terribly high price.

TAPPER: Plus, of course, we'll hear from billionaire Warren Buffett, who says get rid of the debt limit, but he doesn't stop there. This is CNN's special live coverage of the debt ceiling deadline in Washington, D.C.


BALDWIN: So it looks like Congress is actually taking a page from Oscar Wilde. You know Oscar Wilde who said, "I never put off till tomorrow what I can possibly do the day after." So -

TAPPER: So erudite.

BALDWIN: Thank you very much.

So here we are, a Senate deal to procrastinate. I'm so sick of this cliche. I don't -- can you come up with a better way of saying kick the can down the road?

TAPPER: To kick the can down the road? No.

BALDWIN: But that's exactly what it is. Reopen the government and temporarily raise the debt ceiling and tell these budget negotiators to come up with a long-term spending plan in the meantime. So, Christine Romans is our chief business correspondent. She's going to be joining us here from Washington. Also, Peter Morici is with us here. He's an economist, he's a professor at the Smith School of Business at the University of Maryland.

TAPPER: So, Professor thanks so much for being here. Even if Congress settles this -- the debt limit fight and reopens the government, we could be right back here in the winter?

PETER MORICI, PROFESSOR OF INTERNATIONAL BUSINESS: Absolutely. The basic conflict that exists between the majority in the House, which won its election in 2012, and the president, which won his election in 2012, has not changed. One group wants to cut spending. The other wants to raise taxes. One group likes Obamacare, maybe tweek it a bit. The other wants to wholly dismantle it. There's a lack of realism on both sides.

BALDWIN: You were already saying before the show, get your January clothes ready to do a live outside Capitol Hill then, which is frightening to think about.

Christine Romans, I want to go to you, because, you know, I picked up "The Washington Post" today, the cover of it, you know, the weather is mostly sunny but I don't know if Fitch would agree with that. Fitch threatening, you know, possible downgrade to America's credit rating because of all this bickering back and forth here in Washington. And we all remember what happened in 2011 with S&P, the downgrade, the AAA.


BALDWIN: Let me just quote Fitch here. They say, "the repeated brinksmanship over raising the debt ceiling also dents confidence in the effectiveness of the U.S. government," and they go on, "and political institutions and in the coherence and credibility of economic policy, it will all have some detrimental effect on the U.S. economy." Detrimental, when I read that word, that frightens me a little bit. But I'm also thinking, again, if we're here back in January having the same discussion, what kind of damage does this do?

ROMANS: Right. Well, and, Brooke, Fitch noting that, you know, there is resilience. We were the biggest economy in the world. There's resilience in the economy. It's Congress. It's the policymakers that are holding it back, and that is what is so frustrating about this. I mean you look at the economic damage so far, some $20 billion depending on what estimates you look at. It's the size of a hurricane. It's hurricane shutdown, but it's manmade.

Now, you can get over that kind of economic loss if you quickly get things back to normal. But you're absolutely right, we're not talking about getting things back to normal, we're talking about getting them back to the new normal, which is budget fight after budget fight, partisanship over partisanship, arguing about, first, Obamacare then balancing the budget and then back to Obamacare, and then you just have this absolute gridlock in Washington.

So, kicking the can helps for now, but we really have to figure out how to get our spending and taxing priorities in place and fix this thing so we're not doing it over and over again. That's what really, really threatens the U.S., its economy, and its outlook for investors.

TAPPER: Peter, the "Oracle of Omaha," billionaire investor Warren Buffett, said that the debt limit itself, he compared it to a nuclear bomb. Take a look at what he told Poppy Harlow on CNN this morning.


WARREN BUFFETT, CHAIRMAN AND CEO, BERKSHIRE HATHAWAY: It is totally asinine to have a debt ceiling at all, and to use it as a means to try and get your way on anything else, whether it's abortion, gun control, Obamacare, you name it. It's a political weapon of mass destruction that shouldn't be used.


TAPPER: So he says stop using the debt limit. But I do wonder what you think is the bigger issue, the debt or these political fights that we're seeing having to do with the debt limit, because I know there are a lot of economists who are very concerned about the debt, $17 trillion almost as of now, but at the same time, these ratings agencies seem much more concerned about the political dysfunction.

MORICI: That's right. The rating agencies have their eye on the short term. Most economists that are concerned about this, and these are people that are, you know, nonpartisan. For example, the Congressional Budget Office show U.S. deficits spinning out of control later in the decade and becoming unmanageable say by 2030 because of things like people living longer but we haven't raised the retirement age.

Do you know that we spend 50 percent more than the Germans do on health care? And they have a private system with insurance. They cover everybody. And by every available measure, they had better health care. These comparisons to the U.K. are disingenuous. The Japanese, the same as the Germans. The Dutch, the same as the Germans. We simply don't have a competitive health care system and we have essentially an insolvent retirement system.

BALDWIN: But just quickly, I just wanted to get your response to this notion of no -- not having a debt ceiling. Isn't that like somebody handing me a black American Express and saying, go, spend?

MORICI: Well, now you've got the Republican position. First of all, it wouldn't have been a nuclear bomb simply because there are ways to continue to service the debt even if you hit the limit because you're going to have to cut spending by 20 percent anyway, so it would be by 25, you service the debt and you go forward.

The real problem here is they simply can't agree on the basic facts. The need to reform Social Security and federal pensions and the need to radically alter, in ways that are different than the Republicans prescribe and the president wants, to radically alter health insurance in America so that we get our prices down. It's not access. We're paying astronomical prices for care.

TAPPER: All right, Peter Morici, thank you so much.

BALDWIN: Thank you.

TAPPER: Christine Romans, appreciate it.

BALDWIN: Coming up next, behind the scenes wrangling to get this 11th hour deal done. I will take you inside the Capitol here for this exclusive look into how this whole deal came together. That's coming up.

TAPPER: Plus, the glitches and grumbling of enrolling in Obamacare. Now even President Obama is voicing frustration. You'll hear what he said about the website complications. This is CNN's special live coverage from Capitol Hill.


BALDWIN: We are back here live on Capitol Hill with my colleague, Jake Tapper, covering this deadline. But what was fascinating, and you - you know, before you were a White House correspondent, you covered Congress for many a year.

TAPPER: Uh-huh.

BALDWIN: But for me, the last couple of hours I spent sort of attached to Dana Bash's hip as she was walking through really how her job works. So many of you see her on television, but it's pretty incredible just the access --

TAPPER: It's incredible.

BALDWIN: You know, the reporters and the journalists and the radio folks and the still photographers have to these people who are, if I may make an assuage (ph), so here is a behind the scenes look from inside the U.S. Capitol. (BEGIN VIDEOTAPE)

BALDWIN: OK, I am standing next to the chief congressional correspondent for us, the gal who I am shocked that you are not wearing tennis shoes, Dana Bash.

Have you slept? Have you eaten?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Slept a little bit. Eaten a little bit. Not enough. We're just trying to hydrate here. It's all about hydrating, Brooke.

BALDWIN: Hydrating. And I feel like a lot of it is hurry up and wait. I mean we wanted to show people - this is an incredible job that you have and the access that you have. I mean senators back and forth, back and forth.

BASH: Isn't that amazing?

BALDWIN: How do you do it?

BASH: It's just remarkable. It really -- what makes our job much easier is the access that we have. I mean you just witnessed it, Brooke. We're - right now this is called the Ohio clock quarter, which is where we are, and this is sort of the nexus of where senators come and go because Mitch McConnell's office is down there, Harry Reid's office is over there -

BALDWIN: Harry Reid. And the Senate floor.

BASH: And the Senate floor is over there. So, for example --

BALDWIN: I got my bearings.

BASH: Yes, for example, when the two leaders were negotiating, we would stand right where we're standing right now, watch Harry Reid shuffle along this corridor, go down and meet with Mitch McConnell. That's when we knew that they were actually talking. So a lot of the understanding that things are happening is literally by seeing the movement.

BALDWIN: Will you take me around really quickly?

BASH: Yes. Yes.

BALDWIN: Let's roll.

BASH: Let's look over here at what's going on. This is a huddle of reporters around Senator Jeff Sessions, who's an important player because he's a top Republican on the Budget Committee. This is how we get our information really all day long.

BALDWIN: You chase them down.

BASH: We chase them down. Now, we're not allowed to have cameras beyond where we are right now. we're kind of maybe pushing it a little bit, but we're allowed to be with them with a tape recorder and just - and talk to them really pretty much anywhere around the Capitol, which is what makes our job so terrific because we talk to the principals that we cover all day long.

And now we are in what's called Statuary Hall. You can see why.


BASH: Stat Hall. And we just came from the Senate side over to the House side. But right here behind us, we're limited in where we can go with cameras, but this is where we can be. Right around this corner is where John Boehner's office is. So much action happens here. You sort of see the reporters lingering and loitering in the hallway. So much of our time -- Deirdre Walsh, our congressional producer, myself, Ted Barrett, is spent sitting in that little alcove over there because we want to know who's coming in and out of John Boehner's office because that's where they have the leadership meetings, that's where they actually decide what's going to happen in the House.

BALDWIN: It's incredible to me to see - and I think for the viewer who's not -- doesn't know the inner workings like you do, just to see really the close proximity between all these leaders' offices. It's paces away.

BASH: And you would think that they would actually talk to each other, wouldn't you?

BALDWIN: They could just knock on the doors.

BASH: It's not that had. They don't need a telephone. They don't need Twitter. They can just actually go knock, knock, knock.

BALDWIN: So old school of you.


BALDWIN: Dana Bash, thank you.

TAPPER: For weeks it's been the Tea Party Republicans waging this fight, but now there are two emerging viewpoints within the Tea Party movement. And we'll speak live with a couple Tea Party leaders whose disagree on the next step forward in the fight against Obamacare. This is CNN's special live coverage from Capitol Hill.