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EARLY START

New Uncertainty Over GOP Tax Bill; Omarosa Speaks Out About White House Diversity; 4:30-5a ET

Aired December 15, 2017 - 04:30   ET

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


[04:30:30] ALISON KOSIK, CNN ANCHOR: Republicans planning to unveil their final tax bill this morning, but one key senator is still on the fence. Could Trump's big tax cut go down in defeat?

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I like Omarosa. Omarosa is a good person.

(END VIDEO CLIP)

DAVE BRIGGS, CNN ANCHOR: Omarosa, out of the White House and wasting no time to tell her story. Why she says she felt uncomfortable in the Trump administration.

KOSIK: President Trump making a call to the Kremlin just hours after Putin said the press is dreaming up reports of contacts between Trump campaign and Russia. What the two leaders discussed on the phone.

Welcome back to EARLY START. I'm Alison Kosik.

BRIGGS: I'm Dave Briggs. It was a massive year-end press conference that Vladimir Putin held.

KOSIK: Yes.

BRIGGS: And he complimented the president on the stock market. I think he's done his homework on Trump.

KOSIK: I think so.

BRIGGS: He got a phone call right back.

It's 31 minutes past the hour. In a matter of hours, Republicans plan to unveil the final version of their tax bill. Emphasis on plan to because there is some new uncertainty as Senator Marco Rubio says he may vote against the bill unless the child tax credit is increased. Adding to the uncertainty, two senators, John McCain and Thad Cochran, are dealing with health issues ahead of next week's planned final vote.

Remember now, Senate Republicans have a razor thin majority. They can't afford to lose any more than two votes.

KOSIK: Vice President Pence, he's postponed his planned trip to the Mideast by a couple of days just in case he needs to cast a tie- breaking vote. But President Trump remains optimistic promising Americans the greatest tax cut in U.S. history. Listen.

(BEGIN VIDEO CLIP)

TRUMP: I think we will get there. It will be in a very short period of time. It will be the greatest Christmas present that a lot of people have ever received. It'll be something special.

(END VIDEO CLIP)

KOSIK: OK. For the latest on the tax debate let's bring in CNN's Phil Mattingly on Capitol Hill -- Phil.

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Alison and Dave, for Republican leaders today is the day, the day they've said they will release the full tax overhaul plan, the final bill they plan on voting on as soon as early next week.

Here's one problem, though. They don't necessarily have the votes and late into Thursday night they were still working on hammering out the details of that bill. One of the big moments on Thursday that occurred, Senator Marco Rubio, Republican from Florida, coming out and saying he was a no on the deal that had been struck by Senate and House negotiators. His issue, the child tax credit.

Now that's a tax credit in the bill boosted from $1,000 currently to $2,000. But Senator Rubio's point, he wants it to be more refundable, basically adding more to people in terms of what they would get beyond their income tax liability.

The big problem with that, at least according to Senate leaders, is it is expensive. However, I'm told from several Senate aides that they've been working behind the scenes to try and address those concerns. Will they give the senator everything he wants? No, but they will give him something, something that Republican leaders think will be enough to get him in line.

As one Republican senator told me on Thursday, do you really think Senator Rubio wants to sink this once-in-a-generation opportunity? At least once-in-a-generation from the Republican perspective.

Guys, Democrats still unified in their opposition of this, still complaining about the process, complaining about the policy, saying that in the wake of the Alabama Senate upset that everybody should wait until Senator-elect Doug Jones is seated. That's not going to happen.

Should Republican leaders finalize their deal as they expect to, sign the conference report Friday as they expect to, release the bill Friday night as they expect to, expect them to move very quickly next week? I'm told still the timeline stands. They want the tax bill done through both chambers of Congress and on the president's desk by Wednesday -- Alison and Dave.

KOSIK: OK, Phil, thanks very much. Let's dig into what Senator Rubio is saying. So he wants a more

generous child credit in the tax plan. It's a provision that's not included in the current compromise. In fact some of the big changes, they wind up helping corporations and the wealthy. Like the top individual rate, it's slashed to 37 percent. That's lower than both bills, and it winds up helping top earners in high tax states losing the state and local tax break.

So to pay for that the corporate rate is going to be cut to 21 percent. Not 20 percent. That winds up raising $100 billion in revenue. So Rubio wants those funds to expand the child tax credit for low-income families, not help the rich. The current bill has a $2,000 child tax credit, but only $1100 of that is refundable, meaning Americans get that money if they don't make enough to pay income taxes. So Rubio wants to wind up increasing that amount.

The GOP argues lower corporate taxes are going to help American families.

[04:35:03] Their logic is by adding jobs or raising wages. But there's no guarantee of that and those giant tax cuts are less than -- less than what's being advertised. Now we still need to see the final bill to see what's in it but so far tax cuts for most Americans are modest. They've got a short shelf life. In fact under the Senate plan, all low-income and most middle class families, they wind up paying more in taxes by the year 2027.

BRIGGS: All right. North Korea's ambassador to the U.N. will be in New York this morning to address the U.N. Security Council for the first time in 10 years. The meeting comes after some jaw-dropping predictions from Lindsey Graham, the South Carolina Republican, giving 30 percent odds that President Trump orders a first strike against North Korea. That's to stop it from developing a nuclear weapon capable of hitting the U.S.

He told the "Atlantic" that if Pyongyang conducts another nuclear test there's -- the chances climb to 70 percent. Graham says the topic of North Korea comes up all the time when he plays golf with the president all the time as he did on Sunday.

(LAUGHTER)

KOSIK: Donald Trump calling Vladimir Putin after the Russian leader praised the president publicly for his administration's accomplishments. The White House said Mr. Trump thanked Putin for acknowledging America's strong economic performance and also discussed working together on the crisis in North Korea.

Earlier in the day the Russian president held his annual news conference and complimented the Trump administration for its, quote, "fairly serious achievement." He also called reports of contacts between Russia and the Trump administration or the Trump campaign dreamed up.

BRIGGS: Omarosa Manigault Newman speaking out about White House diversity or lack thereof the day after a mysterious exit from the West Wing. A White House salary report showing Omarosa was the only African-American among top level White House staff. She tells ABC this often left her feeling lonely.

(BEGIN VIDEO CLIP)

OMAROSA MANIGAULT NEWMAN, FORMER WHITE HOUSE SENIOR ADVISER: As the only African-American woman in this White House, as a senior staff and assistant to the president, I've seen things that have made me uncomfortable, that have upset me, that have affected me deeply and emotionally, that has affected my community and my people. And when I can tell my story it is a profound story but I know the world would want to hear.

(END VIDEO CLIP)

BRIGGS: CNN's Jeff Zeleny has more from the White House.

JEFF ZELENY, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Dave and Alison. Still more questions about that departure earlier this week of Omarosa Manigault Newman. Of course she is the senior adviser to the president in charge of African-American outreach. Of course she also was the star in "The Apprentice" series some years ago.

Now she left the White House abruptly earlier this week. She was not please by that. There were reports of screaming and yelling and being taken out of the White House complex. White House officials have downplayed most of those, but we do know there certainly was a back and forth, a series of exchanges. She was not pleased by her abrupt departure.

But it raises the question, why will she still be on the government payroll for another month or so until she leaves in January because she's no longer working here? We took that question to White House Press Secretary Sarah Sanders on Thursday.

(BEGIN VIDEO CLIP)

ZELENY: If she's resigned, you said she will stay on -- Omarosa will stay on until January 20th. Why are the taxpayers continuing to pay her salary for another month if she's no longer here at the White House?

SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: As I just said I'm not going to weigh in any further as we often do and is the practice. We're not going to get deeper into personnel matters.

ZELENY: So why is she still on the payroll for another month? Is that normal?

SANDERS: Look, there's a lot of different protocols that take place in the government. That's part of the process. If you want to reach out to HR, they might be able to walk you through that in a more detailed way.

(END VIDEO CLIP) ZELENY: Now staff departures are frequent particularly at the end of a one-year period of a White House. Particularly one that has been as tumultuous as this. But there are more questions surrounding Omarosa's departure than any of the others we've seen so far this year. She says that she'll explain all of this in a tell-all book -- Dave and Alison.

KOSIK: All right. Jeff Zeleny, thanks very much.

Close friends of Congressman Paul Ryan tell CNN the House speaker is doing some soul searching about his political career. They believe it's possible Ryan could leave Congress after the 2018 midterm elections if he achieves his goal of overhauling the U.S. tax code. Ryan denies the report telling reporters this, "I ain't going anywhere." White House Press Secretary Sarah Sanders says that was music to the president's ears.

(BEGIN VIDEO CLIP)

SANDERS: The president did speak to the speaker, not too long ago, and made sure that the speaker knew very clearly in a no uncertain terms that if that news was true he was very unhappy with it. The speaker assured the president that those were not accurate reports.

(END VIDEO CLIP)

KOSIK: So what could this be about? Well, some of Ryan's friends believe he may be just suffering from a bout of Trump exhaustion. We're told Ryan particularly dislikes the toll the job takes on his family.

[04:40:03] I know that he actually doesn't go home every day or quite often.

BRIGGS: Yes.

KOSIK: Because he actually sleeps in his office. He's got a cot in his office. A bed in his office.

BRIGGS: You wonder if this has to do with the 2018 midterms. If he's the minority leader, does he then take the exit ramp? We shall see.

All right. Congressman Blake Farenthold announcing he will not run for reelection next year. The House Ethics Committee already investigating sexual harassment allegations against the Texas Republican. On Thursday he released this video apology.

(BEGIN VIDEO CLIP)

REP. BLAKE FARENTHOLD (R), TEXAS: And I allowed the personal stress of the job to manifest itself in angry outbursts and too often a failure to treat people with the respect that they deserved. That was wrong. Clearly it's not how I was raised, it's not who I am, and for that situation, I am profoundly sorry.

(END VIDEO CLIP) BRIGGS: The news of Farenthold's decision to retire follows a CNN report Wednesday about a former senior aide who claims the lawmaker made sexually graphic jokes and berated staffers. Like all members of the House Farenthold's term ends every two years so his plan to retire means he could remain in office until January of '19 and that includes through those 2018 midterms. It could be some tough optics for Republicans in the House.

KOSIK: Absolutely.

BRIGGS: Yes.

KOSIK: All right. Disney and 21st Century FOX joining forces in a $52.4 billion merger. Reaction from the White House next.

(COMMERCIAL BREAK)

[04:45:56] BRIGGS: Huge talker on the Internet the past week. Tech giants like Amazon, Facebook, and Netflix vowing to fight the FCC's decision to roll back the Obama-era net neutrality rules. The Republican-led commission voting 3-2 along party lines to repeal regulations that stopped Internet service providers from deliberately slowing down or speeding up traffic from specific Web sites and apps. The rules also prevent Internet providers from giving their own services an advantage over rivals.

KOSIK: New York's attorney general, Eric Schneiderman, he's already working on a multistate lawsuit to roll back the FCC vote. Washington state attorney general Bob Ferguson also indicating he's going to sue.

Among opponents of the change, this tweet from Netflix. "We're disappointed in the decision to gut net neutrality protections that ushered in an unprecedented era of innovation, creativity, and civic engagement."

BRIGGS: Internet service providers applauding this move. Verizon, quote, "Verizon fully supports the open Internet and will continue to do so. Our customers demand it and our business depends on it."

The repeal of net neutrality regulations does not take effect until next year. The issue may wind up being decided in court and Congress could also step in with a legislative solution.

KOSIK: President Trump praising the $52.4 billion merger between Disney and 21st Century FOX. White House Press Secretary Sarah Sanders confirming the president congratulated FOX mogul Rupert Murdoch. "Vanity Fair" reports Trump actually called to make sure Murdoch was not selling FOX News.

The president believes the deal could be good for jobs but the thing is this is a horizontal merger. This is happening between or could happen between two direct competitors. So that usually means job losses, it means less competition, it raises anti-trust concerns. In fact, the companies say the merger saves $2 billion and analysts expect most of those savings will wind up being in layoffs. Now the administration's reaction is actually in stark contrast to

AT&T and Time Warner deal that's in the works. That's the parent company of CNN. That is a vertical merger between two companies that don't compete. Yet the Justice Department recently moved to block the deal.

Disney's new deal with 21st Century FOX also helps Disney transform into a streaming video giant to rival Netflix. It's now the majority owner of Hulu and plans to launch its own streaming service next year. So Disney will be pulling its content from Netflix in 2019, including films from Marvel, Pixar, and Disney Animation.

BRIGGS: Among 21st Century FOX's holdings of course is FOX News. Top boss Rupert Murdoch dismissing the impact of sexual harassment scandals that have plagued FOX News over the past year. Murdoch telling Sky News they haven't hurt the cable news operations' bottom line.

(BEGIN VIDEO CLIP)

RUPERT MURDOCH, EXECUTIVE CO-CHAIRMAN, 21ST CENTURY FOX: There's a problem with our chief executive, sort of over the year but isolated incidents. As soon as we investigated it, he was out of the place in hours. Well, three or four days. There's been nothing else since then. Now, of course, but that was largely political.

(END VIDEO CLIP)

KOSIK: In 2016, FOX News' former CEO, the late Roger Ailes, resigned after star anchor Gretchen Carlson filed a lawsuit alleging sexual harassment. Then this past April host Bill O'Reilly forced out when a "New York Times" investigation found he and FOX had paid tens of millions of dollars to settle sexual harassment claims. Both Ailes, who died in May, and O'Reilly denied the allegations against them.

BRIGGS: New York City Police now investigating sexual misconduct and rape allegations against music and media mogul Russell Simmons. The NYPD has not received a direct complaint against Simmons but started the probe based on multiple accusations being reported in the media. Simmons' attorney says he fully supports and will cooperate with the investigation.

[04:50:03] In a statement to CNN, Simmons vehemently denies the allegations. He posted this photo on Instagram with the comment, "Today I begin to properly defend myself. I will prove without any doubt that I'm innocent of all rape charges."

KOSIK: So the lines have already begun. "Star Wars: The Last Jedi" lands in theaters tonight. Ticket sales already soaring to new record highs. Details on CNN Money Stream next.

(COMMERCIAL BREAK)

KOSIK: A self-proclaimed neo-Nazi who allegedly drove his car into a crowd of demonstrators in Charlottesville last summer now faces first- degree murder charges. [04:55:04] Twenty-year-old James Fields was already charged with

second-degree murder in the death of counter-protester Heather Heyer. Thirty-five others were injured. On Thursday, prosecutors upgraded the charge against Fields to first-degree murder which carries a sentence of 20 years to life. The case goes before a grand jury on Monday.

BRIGGS: A San Diego firefighter killed while battling that raging wildfire in California. Cory Iverson was part of a team taking on the 11-day-old Thomas Fire in Ventura County. Powerful winds continue to fuel this fire which has scorched a quarter-million acres and destroyed nearly 1,000 structures.

Officials say an investigation is underway to determine the circumstances surrounding the 32-year-old's death. Iverson leaves behind his wife and their 2-year-old daughter. The family is expecting a second daughter this spring.

KOSIK: Tensions rising between the U.S. and Russia over Syrian skies. U.S. Defense officials say two American F-22 stealth fighters intercepted two Russian aircraft after they crossed a deconfliction line separating Russians and U.S.-led coalition aircraft. One U.S. official says the encounter lasted several minutes. A military spokesman says the biggest worry is shooting down a Russian plane because it appears to be threatening coalition forces.

BRIGGS: The White House issuing a warning to Tehran after new evidence comes to light the U.S. says proves Iran is arming the rebels in Yemen. U.S. ambassador to the United Nations, Nikki Haley, called on the international community to build a coalition Thursday and combat what she called a global threat.

Haley, standing before a display of weapons debris at a military base in Washington that she said included pieces of a short range missile, proof that she said shows a pattern of behavior of Iran defying the U.N. Security Council.

(BEGIN VIDEO CLIP)

NIKKI HALEY, U.S. AMBASSADOR TO THE UNITED NATIONS: This evidence is part of what has led the U.S. intelligence community to conclude unequivocally that these weapons were supplied by the Iranian regime. The evidence is undeniable. The weapons might as well have had "Made in Iran" stickers all over it.

(END VIDEO CLIP)

BRIGGS: Haley claims the missile was made in Iran and sent to Houthi rebels in Yemen, who then fired it to a civilian airport in Saudi Arabia. Iran's foreign minister Javad Zarif rejecting the claims. He tweeted two photos following Haley's speech, apparently comparing it to Colin Powell's 2003 U.N. speech which claimed Iraq was hiding weapons of mass destruction.

KOSIK: All right. Let's get a check on "CNN Money Stream" this morning. Global markets are mostly lower today. Wall Street close lower on concerns over whether or not the tax bill is going to pass. And hopes for tax cuts, well, that sent stocks to record highs this year.

Senate Republicans have got a thin majority here and Senator Marco Rubio says he may vote against the bill unless the child tax credit is expanded. We did see the Dow snapped a five-day winning streak. Meantime shares of Disney and FOX jumped on the news of their upcoming merger.

Wal-Mart is letting workers get paid whenever they want. The company announced a new InstaPay for its 1.4 million workers. The service will allow employees to access half of their wages before payday. And they can with draw that pay whenever they want. InstaPay is part of a personal finance app called Eden which connects directly to a worker's account. Wal-Mart is footing the bill for the app.

Ticket sales are going strong with "The Last Jedi" -- "Star Wars: The Last Jedi," landing in theaters last night and gosh, ticket sales already soaring to a near record $45 million for Thursday alone. That's according to early estimates. And it is the second best preview number behind the previous "Star Wars" film, "The Force Awakens."

"The Last Jedi" is on track for an opening weekend of about $200 million. And that will make it the strongest opening of the year. But I hate to say it but I don't think that's a far stretch because I haven't really liked any of the movies out this year.

BRIGGS: I was going to ask you what else has been out this year myself.

KOSIK: I know. So I'm going to go and see this. I haven't seen a movie in so long.

BRIGGS: I'm with you. It's been years, frankly.

KOSIK: I did see "Lady Bird," however. That was awesome.

BRIGGS: Will you see it this weekend, though? Will you fight the crowds?

KOSIK: You're right. All right. I'll wait a little bit.

BRIGGS: Ninety-four percent on Rotten Tomatoes but on Twitter I'm seeing mixed reviews at the moment. Let us know if you've seen it, @earlystart.

(LAUGHTER)

BRIGGS: EARLY START continues right now.

KOSIK: Republicans planning to unveil their final tax plan this morning but one key senator is still on the fence. Could Trump's big tax cut go down in defeat?

BRIGGS: President Trump making a call to the Kremlin just hours after Putin said the press is dreaming up reports of contact between the Trump campaign and Russia. What the two leaders discussed on the phone.

KOSIK: North Korea addressing the U.N. for the first time in a decade this morning.