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GOP Tax Bill Faces New Uncertainty Ahead of Vote. Aired 7- 7:30a ET
Aired December 15, 2017 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: We have tremendous support. I think we will get there. It will be in a very short period of time.
[07:00:30] UNIDENTIFIED MALE: They'll work something out. I don't think anyone thinks that Rubio is going to hold up this bill.
UNIDENTIFIED MALE: Two Republican senators are both ill.
UNIDENTIFIED MALE: GOP leaders say both will be back, and the votes will be there.
UNIDENTIFIED MALE: This is very close to not passing.
UNIDENTIFIED MALE: This bill is wildly unpopular. People understand that this is a betrayal of the middle class.
CHRIS CUOMO, CNN ANCHOR: An officer's unbelievable sacrifice for a child whose mother battled drug addiction.
UNIDENTIFIED FEMALE: I don't know where he came from, but I'm really happy that he's here.
UNIDENTIFIED MALE: It's a testament to just how strong addiction is.
UNIDENTIFIED MALE: Do you give up on them?
UNIDENTIFIED MALE: I'll never give up.
ANNOUNCER: This is NEW DAY with Chris Cuomo and Alisyn Camerota.
CAMEROTA: Good morning, everyone. Welcome to your NEW DAY.
Up first, the first possible legislative victory for President Trump is on shaky ground this morning. The GOP is expected to unveil its tax plan today. But Senator Marco Rubio says he will vote "no" if the child tax credit is not increased. So will the president be able to keep his promise of a giant tax cut for Christmas?
CUOMO: President Trump calling Vladimir Putin on the telephone after the Russian leader said that the U.S. claims of interference in the 2016 election are nothing more than spy hysteria. The president called Putin to say that's not true, called him to thank him in part for saying that the U.S. economy is strong.
All right. That takes us to the next issue. The secretary of state and the president appearing to not be on the same page about North Korea. What will America's top diplomat say today when he speaks at the U.N. Security Council.
We have it all covered. Let's begin with CNN's Joe Johns live at the White House -- Joe.
JOE JOHNS, CNN CORRESPONDENT: Good morning, Chris.
The White House will be watching closely today as members of Congress roll out what they hope will be the final language on this big tax bill. The administration continues to express hope that the House and Senate will be able to get that bill to the president's desk for his signature by Christmas.
But there's still the potential for holdout votes, including Republican Florida Senator Marco Rubio. And some others in the Senate who, frankly, have been harshly critical of the president in the past.
TRUMP: He's really been a great guy and very supportive. I think that Senator Rubio will be there, for sure.
JOHNS (voice-over): President Trump confident that Senator Marco Rubio will get on board with the Republican tax plan despite Rubio's declaration that he will vote against the bill unless negotiators expand the child tax credit, a measure he's been pushing alongside Senator Mike Lee.
SEN. MARCO RUBIO (R), FLORIDA: I remain surprised that there is not more consensus to support the reality that we need to do more to help working people in this country.
JOHNS: Rubio poking his Republican colleagues Thursday, tweeting, "Tax negotiators didn't have much trouble finding a way to lower the top tax bracket and start the corporate tax cut a year early."
REP. KEVIN BRADY (R), TEXAS: We're at 11:59 on the clock and, really, the pins ought to be down.
JOHNS: Rubio's demand raising additional questions about how Republicans will pay for the bill, which cannot add more than $1.5 trillion to the federal deficit over the next 10 years if Republicans want to pass the measure without support from Democrats.
With a narrow 52-48 majority in the Senate, Republicans can only afford to lose two votes and still pass the bill along party lines.
The impact on the deficit prompting Republican Senator Bob Corker to vote against the original bill. Corker telling CNN Thursday he has the same concerns he's had in the past but declined to say how he will vote on the updated legislation.
Two other wild cards, Senator John McCain and Thad Cochran, who have been away from the Capitol all week while grappling with health issues. McCain's office announcing Tuesday that the senator is being treated at Walter Reed Hospital for "normal side effects of his ongoing cancer therapy." But sources inside the Senate describe the 81-year-old war hero as "increasingly frail."
A spokesman for Senator Cochran, who's had a number of health problems this year, telling CNN Cochran had an outpatient procedure to address a nonmelanoma lesion on his nose. But that he is doing well and available now for votes if needed.
Vice President Mike Pence delaying a trip to Israel in case he needs to cast another tie-breaking vote.
The tax push unfolding as one of the bill's biggest proponents, House Speaker Paul Ryan, dismisses rumors that he's considering leaving Congress after the 2018 midterm elections.
[07:05:05] UNIDENTIFIED MALE: You're not quitting any time soon?
REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: I'm not.
JOHNS: Some of Ryan's close friends telling CNN the speaker has been doing some soul searching about his political future.
SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: The president did speak to the speaker not too long ago and made sure that the speaker knew very clearly and, in no uncertain terms, that if that news was true, he was very unhappy with it.
JOHNS: The president today heads out to the FBI national academy in Quantico, Virginia, to deliver an address to the graduating class there. It will be interesting to see what he has to say after his recent critical comments about the FBI. He is also expected to spend the weekend at Camp David -- Chris and Alisyn.
CUOMO: All right, Joe. Thank you.
Joining us now, CNN political analyst Maggie Haberman. Maggie, good to have you as always.
MAGGIE HABERMAN, CNN POLITICAL ANALYST: Thank you.
CUOMO: Are we going to get the big Christmas present?
HABERMAN: Define what that present is.
CUOMO: The tax plan. That's what the president says.
HABERMAN: The tax plan? That's the president's Christmas present. Some people consider it less of a Christmas present. At the moment it looks like yes. But we have entered this window where, because the possibility for passing it with the votes that they had is so narrow, or the votes they think they could have.
Everybody now has an opportunity to use their leverage and go back out. All these senators, you're seeing that Marco Rubio with the child tax credit, go back out and essentially put their finger on the scale a little bit more and see if they can get any more.
The White House still thinks it looks favorable. But I wouldn't cast a bet either way right now. We have seen throughout the year the legislation that they thought was going to be OK on not only health care. Repeal and replace. It did not end up going through at the end of the day.
And there's a lot of "X" factors here. There's the fact that Senator John McCain is still in the hospital. Some people have suggested he will be back in time, but we will see. There are other senators who are still on the fence.
I think when McCain had appeared to go for the tax bill, that was a permission structure for other people who have been holding out. He's a big question mark here.
CAMEROTA: So what's going on inside the White House while all of this is happening? How worried is the president? How involved has he been in trying to twist arms or whatever has happened.
HABERMAN: My understanding is that he is still making calls. He has still been involved and been very involved in this effort. He has been more involved and, I think, more on top of the details that he was with health care, which just is not sort of more of a natural language to him in a lot of ways. This is, you know, a little bit easier in terms of him.
But look, the legislative affairs votes know, now that they're under a lot of pressure to secure a win. And so that does not create for a calm, easy environment. They are under a lot of pressure. If it doesn't get done now, they know that it will not get it done at all. And they already know that they're facing a really difficult year two in terms of any significant legislation. Year one is always in presidencies when you get your major pieces done. This would be the last possible window. So there's anxiety.
CUOMO: You never know what you're getting from Sarah Sanders. So what's your read on how the White House, how the president feels about Ryan potentially exiting, potentially leaving the speaker role but staying in the Congress?
HABERMAN: So my understanding had been he doesn't naturally love Paul Ryan. We know this. But he loves Mitch McConnell even less these days, right? So usually what happens is with these president, is it's like a scale. And as one side goes lighter, the other person's weight gets heavier.
He and Paul Ryan have been doing better since he and Mitch McConnell have had their blowup over the summer, and it was a blowup that kind of just escalated and continued.
The president supposedly called Paul Ryan yesterday when he saw these reports and he was concerned. Ryan said, "I'm not going anywhere."
I have certainly heard these rumors that Ryan will not be lasting, though my understanding is that it was more about sort of pragmatism that he wasn't sure he'd be able to keep the job, you know, even if the Republicans hold the House because of how tumultuous these last few years have been.
I think the president would rather have the devil he knows at this point than the devil he doesn't. I think he recognizes that he would be going into an easier fight with Ryan. And I think he is starting to understand that no matter how good his relationship is with, say, the House Freedom Caucus, which is the conservative -- ultra conservative group -- they're not going to score him the wins he needs on their own.
CAMEROTA: Can you help us understand -- excuse me -- why Secretary of State Rex Tillerson still has his job given the tension, the lack of respect that the president and Rex Tillerson seem to have for each other? Rex Tillerson reportedly said -- called the president an effing moron. And he still has his job. So what's going on?
HABERMAN: Mostly, what's going on is that John Kelly has wanted continuity for the first year. He has wanted to make sure that major faces do not leave. We are talking about Jeff Sessions, Rex Tillerson, H.R. McMaster, the national security advisor. Those are the people who he wants to make sure would just get into year two.
I do think you are going to see Rex Tillerson ultimately departing sometime in January. That is still the expectation of most people in the White House. But they are also trying to get it to a place where it's Rex Tillerson's choice, where it's not the president firing everybody all the time. Because morale is already really low in that building.
CUOMO: How did they get to that place? Because you know, as you're saying, the facts support the obvious outcome here, which is they have been just sweating off talent like we've never seen before.
HABERMAN: Right. Right.
[07:10:07] CUOMO: And he had said he'd bring in all the best people. Rex was kind of his crown jewel before the generals.
HABERMAN: Right. Yes.
CUOMO: And if he goes, how is it not about the president sweating more talent?
HABERMAN: In this case, it would be because I think it's just mutually been seen as not working out. Right? Even some of Rex Tillerson's strongest defenders who helped push him for the job have grown to be a little disappointed with what seems to be a foreign policy vision that is aimed almost entirely at the building and narrowing down the diplomatic corps and going by certain metrics of shrinking the staff, which is just not seen by almost any person who has been involved in diplomacy for a long period of time, which Rex Tillerson has not, as an effective way to run the State Department.
Rex Tillerson is clearly frustrated. He has often felt like he is shadowed by Jared Kushner, the president's son-in-law, who for a while was referred to as -- privately as the secretary of state among West Wing staff. So there's this feeling that that one will not be seen as a race to the exits, because they don't think that has worked that well.
The question is who the replacement will be? Is it still Mike Pompeo, as the favorite? Could Mike Pompeo get through confirmation hearings without getting asked a million questions about Russia and the things he has said about the investigation into meddling? So there's a lot of questions there.
CAMEROTA: Nice segue to Russia. Let's talk about this. The president...
HABERMAN: It wasn't intentional.
CAMEROTA: Yes. I just happened to notice. The president made a phone call to Vladimir Putin, not to chastise him or talk about sanctions or tell him that it is not -- meddling is not nonsense but to thank him for complimenting President Trump and the economy.
HABERMAN: So people who think that -- there was a report recently that Vladimir Putin gets briefed on the president's tweets, which would be sort of an obvious thing to do, I think, for any foreign leader. But he certainly knew what he was saying when he -- I believe, when he, a day earlier said, "Look at -- the markets are doing well." That's the president's own statement, the U.S. president's statement all the time. "Markets are doing great." He tweets about it all the time, that he doesn't think he's getting enough credit. That is always his word, is that he's not getting enough credit.
And Vladimir Putin, this one is not really a hard one to figure out. But he is clearly working the Donald Trump playbook.
Even people who have just made sort of neutral observations about the president over the years that were not intended as flattery, the president sometimes hears it that way. How many of us have received phone calls from him over the years, where he has read a story or seen something on TV and said, "Hey, thanks for saying that," when your goal in saying that had nothing to do with how he would receive it. I suspect Vladimir Putin's goal was a little different.
CUOMO: Now, I haven't seen a full readout of the call.
HABERMAN: No one -- no one has.
CUOMO: So I don't know -- I don't know what else they discussed. But we do know this part about him thanking the president for the -- the economic indicators that Putin put forward.
Was there, to your knowledge, any instinct by anyone around him to say, "Not now. Don't call Putin right now. Unless you're going to talk about interference, because there is all this news out there right now about how you avoid it like an allergy and that you seem to be afraid of Putin. Don't call him now."
HABERMAN: I don't know specifically on this call. I do know that, generally speaking, in most situations, there are often people who tell him, "Please do not do this." And he does these things anyway.
I mean, I think one of the biggest misconceptions about this White House is that everybody is just a "yes" man. I think there are certainly degrees, but there are people who say "no," and it doesn't really matter.
CAMEROTA: What's the back story on Omarosa's exit? And I ask because on morning TV yesterday, she seemed to be kind of sharpening her knife a little bit for this tell-all, that she says she has a story to tell. That doesn't sound like a friend of President Trump's.
HABERMAN: Let's say a couple of things. No. 1, whatever the precipitating incident was, it's still a pretty close hold. John Kelly has wanted her out for a long time. Other people had tried curtailing her influence for a long time. Jared Kushner among them, Reince Priebus among them.
I think John Kelly is, you know, he's a general. And he's a little sharper in terms of how he deals with these things. And he has the president's trust. Whatever -- whatever it was, it required buy-in from the president. Whatever it was is such a close hold that only a handful of people, among them John Kelly, Don McGahn, the White House counsel, Joe Hagen, a deputy chief of staff, they are the ones who know about this.
And Omarosa said something interesting in that interview, where she said her conversation with Kelly about her departure took place in the situation room. That's very unusual. And I don't understand why it would have taken place there.
But I will say, she is now yet another person who, after Donald Trump has spent years, you know, pushing NDAS on people with limited success, nondisclosure agreements, she's the latest person to say, "You know what? I'm just going to go out and talk." And I'm wondering what that's going to look like.
CUOMO: And get paid.
HABERMAN: And get paid.
CUOMO: For another month.
HABERMAN: Everybody seems -- get paid by the taxpayers for another month. Even though she had her security clearance deactivated. According to an incredibly unusual public declaration by the Secret Service about their role or lack thereof in this process, where they confirm that her pass was deactivated. I have never seen that before.
CAMEROTA: This is bizarre.
[07:15:03] HABERMAN: It's weird.
CAMEROTA: OK, Maggie. Thank you.
HABERMAN: Thank you.
CAMEROTA: Thanks so much for all the...
CUOMO: All right. So when it comes to the GOP tax plan, who is going to benefit the most? The middle class or the rich? How about a nice juicy debate, next?
CAMEROTA: Plus, what do Trump voters hope to see happen in the new year? What do they predict? We ask them.
[07:19:22] CUOMO: Republicans are hoping to deliver President Trump his first major legislative victory by Christmas. But they seem to have hit a snag. You know, in this rush to make ready, there's been a lot of uncertainty left on the table.
And here's one example. Senator Marco Rubio is threatening to vote "no" on the tax bill unless the child tax credit is raised. Now, a lot of this is gamesmanship. You know, when you have a vote that's this close, all these senators have a lot of leverage so they can try and put their signature on it. But it raises the question: is the legislation in jeopardy and should it be?
Let's discuss CNN senior economics analyst Steven Moore and CNN global economic analyst Rana Foroohar. It is good to have you both.
STEVEN MOORE, CNN SENIOR ECONOMICS ANALYST: Good morning.
RANA FOROOHAR, CNN GLOBAL ECONOMIC ANALYST: Thank you.
CUOMO: Whatever you celebrate, I hope you celebrate it well at this time of year. And let's start with something specific and then go into the general notion of why this might work. And then I want to talk a little net neutrality when I have you big brains here, as well.
FOROOHAR: All right.
CUOMO: OK. In terms of who this is designed for, we know the stat that there's an estimate that 60 percent of the value goes to the top slice of those earners in this economy.
But there's something else that's more stark that needs to be explained. The tax cuts even for me, even for a one percenter, are temporary. The cuts for the businesses are permanent. Why that preference?
MOORE: Well, that's a good question. And we struggle with this, by the way. And a lot of the businesses said, "Look, if we're going to do a lot of planning, build a new plant, or factory or invest more in equipment and so on, we want to make sure that this tax cut isn't going to go away." And that was -- they told us, you know, "We will invest, but we want to make sure you're not going to snatch this away from us." And that's the reason we wanted to make the business tax cuts permanent, because we thought it would lead to more long-term investment by businesses.
The reason that the individual tax cuts are temporary is, frankly, because of the $1.5 trillion box. That there was a limit on how much under the budget rules that could be afforded. And the only way you could stuff all this in that box was to make them -- some of them expire after six or seven years, some after eight years and so on.
But by the way, I actually believe that this is going to work. And that, as it works, people are going to say, "Oh, we don't want this to expire." Right? I fully expect that this will eventually be made permanent.
CUOMO: We've heard that before.
CAMEROTA: And now you've heard...
CUOMO: We heard Ronald Reagan say you don't balance the budget on the backs of the poor. It sounds like a preference. I get that the businesses want to do their planning, but business is all about change. Why do they need so much advance notice? Do you like this preference?
FOROOHAR: I don't like the preference. And I don't like it for logic reasons. I mean, Steve and I disagree on what businesses are actually going to do with the money that they're going to get in tax breaks.
I think if you look back in history over the past 20 years you have not seen tax breaks causing that kind of sustained investment on the part of business. You haven't really seen tax breaks creating economic growth in 2001, 2003 under Bush, or even under Obama.
But -- but the key point for me is that this is really a tax break for the corporate sector. And I think that the corporate sector is going to do with that money is bring it back, put it right back into the stock market in the form of buying back their own shares, paying dividends. That's great for me and you. That's great for the top 20 percent of the population that owns 80 percent of the stock, but it doesn't do a lot for Main Street.
And so my worry is that that is going to really increase that gap between Wall Street and Main Street. And we're already in a market that a lot of people think is overheated. And this is sort of pouring kerosene on it.
CUOMO: What do you say to the people who put the president in office three years from now, if the economy is doing well, businesses are doing well, but their wages aren't going up, and dividends are up?
MOORE: That's been the hard part of the economy for the last 25 years, is getting those wages up. Look, the economy is doing a lot, lot better right now than it was a year ago. CUOMO: Before this tax cut.
CUOMO: Why do we need it?
MOORE: President Trump mentioned yesterday in a speech that for every new regulation there have been 20 deregulations and rollbacks of regulation. I think that's had a big effect.
I think that, look, the business community, industry, employers believe this is a pro-business president who wants businesses to succeed. Part of that is the tax cut.
Now, you know, I've talked to a lot of major CEOs of companies and small businesses. You know, "If you get this tax cut, what will you do?" And a lot of them say -- not all of the, but a lot of them -- say, "Look, we're going reinvest in the business. We're going to expand."
And, you know, you look at the GDP numbers now. They're -- we're up to almost 3.5 percent growth. I think we could get 4 percent growth next year. Remember, one of the big elements of this bill is the -- what we call immediate expensing, which allows businesses next year to write off their equipment purchases, if they want to purchase a truck or expand a factory. They can write it off immediately. A lot of businessmen and women are telling me, "Look, you do that, it's like a performance-enhancing drug. We're going to go out there and invest right away."
FOROOHAR: You know, I can believe that small businesses might invest. But small businesses are not going to be the major beneficiary. The major beneficiary are going to be the largest, richest corporations in the world.
You know, Apple stands to gain about $47 billion from this tax cut. Apple is holding 10 percent of America's corporate wealth in offshore tax locations.
MOORE: We want that to come back here, though.
FOROOHAR: Yes, but you know what? It's going to go right back in the stock market, which is exactly what's been happening over the last few years. That dynamic hasn't changed.
What we need to be doing, particularly at the end of a recovery cycle -- let's step back and remember, we've been -- it doesn't feel like it, but we've been in recovery for almost 10 years. That's typically how long those cycles last. So we're really actually due for a recession if you look at it kind of historically. That's the time to be putting safety nets under people, to be making sure that you're doing something for Main Street not Wall Street.
CUOMO: Look, I'm slow on the polls, because people don't know what's in the bill. And the more homework you do on this bill, the more concerned you're going to have. Depending on your particular slice of life.
But I think the reason for the lack of popularity, other than the political spin and the left coming after it so hard and the interest groups, is it's a maybe for the middle class. It's a certainty for the rich. And that's not washing with people, Steve.
[07:25:07] MOORE: Well, let's -- I wanted to address this issue about the stock market. There's no question. I mean, we've gained five to six trillion dollars in wealth just in the last year. And you asked about, well how does that happen...
FOROOHAR: Wealthy people.
MOORE: I mean...
CUOMO: Trump used to say don't look at Wall Street as an indication of Main Street. He'd bash it all the time.
MOORE: But it is also true that, you know, Americans -- most of Americans' savings, in their pension plans, their 401(k)s, that's all in the stock market.
My only point is that when American businesses are more financially healthy, that's when they're going to invest more.
MOORE: They don't invest -- they don't invest. I mean, we learned what happened in the 2008 and '09 recession, right? The stock market crashed. And what -- then what did companies do? They started laying off millions of people.
FOROOHAR: A couple of points. Most Americans keep most of their wealth still in housing. Housing hasn't gone up. In fact, housing quite bifurcated. Rich people in rich locations has seen housing increases. Most of the rest of the country hasn't.
So the stock market really isn't all that connected to Main Street. I wrote a whole book about this.
MOORE: And by the way, I think that's a problem with the American economy. I think every American should be more invested in the stock market.
CUOMO: They've got to have the money.
FOROOHAR: I don't know. I think there's a correction coming, so I don't...
MOORE: Savings -- I think we're too much of a consumer. I mean, if people start saving -- I have one piece of advice for young people watching the show. You want to get rich, start investing even a little bit at a young age. The most powerful force in the universe is compound interest. Get that money...
CUOMO: They've got to have the money. FOROOHAR: First of all, they've got $30,000 in debt.
CUOMO: You know, I mean, so those are the choices that have been made. Let me get something really quick from you guys. Net neutrality, do you like the move by the FCC and why? Quickly.
MOORE: I think that we ought to keep the Internet regulation and tax free. Let people expand. We don't need government regulation to expand Internet access and access to broadband, in my opinion.
FOROOHAR: I think we need a new definition of net neutrality. I want to see an open, equal access Internet for rich and poor.
But I do have sympathy with the broadband providers when they say, "Look, we're building out the pipes of the 21st Century digital railroad."
MOORE: Thank you.
FOROOHAR: I know. We actually agree on something. "And we can't monetize it as well as Google, Facebook."
My worry is that, by repealing net neutrality, you might then create an uneven playing field for average people.
MOORE: And you might have less infrastructure spending by these companies if you tell people you have to give it away for free.
CUOMO: You know what's nice, and you know why I asked you about both? It's the same choice proposition. Who are you going to take care of?
CUOMO: Are you going to take care of what they want or are you going to take care of what I want?
CUOMO: That's what you did with the tax bill. We'll see how it turns out. That's what they're doing with net neutrality. You two, always value added. Thank you very much.
FOROOHAR: Thank you.
MOORE: Merry Christmas.
CUOMO: Merry Christmas. All right, Alisyn.
CAMEROTA: All right. Russian President Vladimir Putin dismissing claims of election meddling as spy hysteria. So why did President Trump thank him in a phone call? Senator Richard Blumenthal, here on that, next.