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Republican's Victory Lap Over Tax Bill; U.N. Showdown Over Jerusalem; Virginia House Balance of Power in Limbo; South Korea Fires Warning Shots Along DMZ; Apple Acknowledges Updates Slow Older Phones. Aired 5-5:30a ET

Aired December 21, 2017 - 05:00   ET


DAVE BRIGGS, CNN ANCHOR: This is what victory looks like as Republicans celebrate passage of its tax overhaul, but the party will be short if the GOP can't approve a spending bill to keep the government open by tomorrow night.


DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We're watching those votes. Let them vote against us. We'll save a lot. We don't care.


CHRISTINE ROMANS, CNN ANCHOR: President Trump with a veiled threat to world leaders as the U.N. prepares for a showdown vote over Jerusalem.

BRIGGS: And how do you pick a winner in a tied election? Wait until you hear how Virginia will determine the balance of power in the bellwether state. A very intriguing scenario unfolding in Virginia.

Good morning. Thanks for getting an EARLY START with us. I'm Dave Briggs.

ROMANS: And I'm Christine Romans. It is Thursday, December 21st. Oh, my gosh, only four more days of shopping. It's 5:00 a.m. in the East, 7:00 p.m. in Seoul, it is noon in Jerusalem.

And in Washington, D.C., a major victory for the Republicans, delivering on tax cuts, killing the Obamacare individual mandate, and opening up ANWR for drilling, all in one move.

[05:00:05] The GOP tax bill just awaits the president's signature.

In touting the bill as a huge tax cut, the president revealed to us the hidden agenda all along.


TRUMP: The individual mandate is being repealed. So in this bill, not only do we have massive tax cuts and tax reform, we have essentially repealed Obamacare. We didn't want to bring it up. I told people specifically, be quiet with the fake news media because I don't want them talking too much about it, because I didn't know how people would -- but now that it's approved, I can say, the individual mandate has been repealed.


BRIGGS: Important to note Obamacare has not been repealed. Those GOP efforts failed this year. It is true the tax bill may destabilize Obamacare by reducing the incentive for young, healthy people to buy insurance. The Congressional Budget Office has said repealing just the individual mandate will likely raise premiums to help cover older, sicker people.

But it will also save the government money as people drop out of the subsidized Obamacare marketplaces.

ROMANS: Now, by admitting the tax bill was a vehicle for hurting Obamacare, the president may have also handed Democrats a powerful talking point for 2018. None of that got in the way of the Republicans' big celebration yesterday.


REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: Something this profound could not have been done without exquisite presidential leadership.

SEN. MITCH MCCONNELL (R-KY), MAJORITY LEADER: This has been a year of extraordinary accomplishment for the Trump administration.

SEN. ORRIN HATCH (R), UTAH: And we're going to make this the greatest presidency that we've seen not only in generation generations, but maybe ever.

MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: President Donald Trump delivered a great victory for the American people.

TRUMP: All friends, I mean, I look at these people, it's like we're warriors together.



ROMANS: The president has yet to sign that tax bill, but companies very quick to announce plans to pass some of their big tax savings to their employees, supporting the claim that corporate tax cuts will eventually help workers.

Now, the bill cuts the corporate rate to 21 percent from 35 percent. Two banks, Wells Fargo and Fifth Third, they say they will hike minimum wages to $15 an hour using their tax savings. Comcast and AT&T promised $1,000 bonuses to more than 300,000 employees. Banks and telecoms will be two of the biggest winners of the lower tax rate. Both of those industries pay high effective taxes. Banks alone could see their profits jump by a quarter.

AT&T's CEO, Randall Stephenson, praised the bill in a statement. He congratulated both Congress and the president. As you know, AT&T is currently being sued by this administration to block its takeover of Time Warner, the parent company of CNN.

Corporate America will benefit from tax cuts, along with other policies of the pro-business Trump administration, policies like cutting regulations. When announcing its bonus, Comcast mentioned both the tax cut and the FCC's repeal of net neutrality. Also boosting military spending is a platform of this administration. Boeing plans to invest $300 million on worker training and upgrading facilities.

BRIGGS: All right. Let's bring in our CNN politics reporter Tal Kopan live for us in D.C. this morning.

Good to see you, Tal.


BRIGGS: Look, whether you like this tax bill or not, and polling shows most do not, Democrats don't have much of an economic message, while Republicans can take this to the voters and say look, the economy is expanding. The companies Christine just mentioned, several big banks, Boeing, AT&T, just to name a few, are already giving some of this money back to their workers.

What economic message will Democrats bring to the voters?

TAL KOPAN, CNN POLITICS REPORTER: That's an excellent question, Dave, and, you know, that's something that we've been talking about throughout the campaign as Democrats are really struggling to find a core message that can speak to voters and pull them to their side. And you know, that's part of why Bernie Sanders had so much appeal during the primaries is that he did directly speak to voters in some ways sort of similarly to Trump about getting their situation back on track.

But, you know, at the same time, it's still an incredibly open question what this tax bill is going to feel like for American voters and what the economy is going to feel like for American voters when they hit the ballot box, which is so important. There's analysis that shows that very small tax cuts people don't really feel the impact of, so it depends how much individuals are actually going to get. And, you know, we'll always just have to see what happens between then and now, but Democrats are probably going to run against this, as they'll say it's a giveaway to corporations at the expense of the middle class. Again, it's going to come down to what voters really feel is the truth about that.

ROMANS: You know, I think that we can't really overstate how much of a win this is for the GOP. They got ANWR drilling, right? They got the Obamacare individual mandate pulled out of there.


ROMANS: They got the tax cuts for corporations. The president mentioned yesterday about how, hey, look, you heard him talk about the hidden agenda of the repealing the Obamacare individual mandate. [05:05:04] But also, this was about corporate tax cuts. I mean, they really wanted to get that playing field leveled around the world so that they could deliver on that promise to the business community.

The question is, will individual people who are voters, in February, when they start to get $18 more in their paycheck, will they notice?

KOPAN: Yes, that's absolutely right. And you know, in the end, it's always been a Democratic message that the Republican Party is more interested in business than the individual. So if the effects of this tax bill bear that out, that could be an effective talking point for Democrats. But you know, when you talk to lawmakers in the lead-up to this, the details were all fuzzy until the very end, as we know, because we've tracked it.

But you know, it was really about getting something done, and I think that is the biggest thing for Republicans is that they now can breathe a sigh of relief because they feel like they have some victory that they can take to voters and show that they're accomplishing something. And when you mention all the things stuck on to it, that's no accident. This thing was moving, and people put, you know, legislators know, when you put something on something that's moving, so now they have some wins they can take back.

ROMANS: Failure was not an option.

BRIGGS: Good reason to celebrate, but it could be short-lived, of course, if we're heading for a shutdown. The clock is ticking to tomorrow night. Will they leave the lights on?

KOPAN: You know, this is such a classic Washington week in some ways, where we don't know. You know, honestly, the Capitol Hill press corps, we're wandering the hallways, talking to lawmakers, talking to each other, and no one knows what's going to happen on Friday, honestly. You know, they're still hammering out what they think they can muscle through, and it's very in the weeds.

But sort of every direction you take, you start to lose a chunk of lawmakers, and we've been down that road before. We know how difficult that can be. Even just passing an extension of a few weeks to get us to mid-January is a bit jeopardized because you have some defense hawks in Congress who are very concerned about the military continuing to run on temporary funding.

And so, even that which is sort of the bare minimum that lawmakers are sort of circling around now, let's just get to January and not shut down over Christmas, even that may run into trouble. So, we're keeping a close eye on it. Congress really seems to want to get out of town. They will probably find a way, but it is not certain at this point how they're going to do that.

ROMANS: All right, Tal Kopan. You're right, it is a classic Washington week, except we haven't had tax reform in 30 years, so it's not --

BRIGGS: Yes, in that way it's rather unique. ROMANS: Kind of a big deal. Paul Ryan was a happy kid yesterday,

wasn't he? It's like the 12-year-old Paul Ryan was waiting for a long time --

BRIGGS: Most of these members, that's why they wanted to go to Congress, cut taxes.

ROMANS: All right. Tal, thank you so much.

KOPAN: Thank you.

ROMANS: Don't fire Bob Mueller. That's the warning to President Trump from the top member of the Senate intelligence committee. Mark Warner of Virginia is calling on the Senate to respond with significant consequences if the president tries to neutralize the special counsel.


SEN. MARK WARNER (D), VIRGINIA: Any attempt by this president to remove special counsel Mueller from his position or shut down the investigation would be a gross abuse of power and a flagrant violation of executive branch responsibilities and authorities.


BRIGGS: White House counsel Ty Cobb telling CNN no consideration is being given to firing Mueller. He adds: If the media is going to continue to ask for responses to every absurd and baseless rumor, attention-seeking partisans will continue to spread them.

Mueller is facing a growing number of Republicans who claim there is an anti-Trump bias in the Russia investigation.

ROMANS: Another twist in the Virginia House race leaving the balance of power there in limbo. Now, it basically comes down to the luck of the draw. A recount had given Democrat Shelly Simonds the victory by one vote over Republican David Yancey, but a three-judge panel has now declared one more valid vote for Yancey, so now the final tally is a tie, 11,608 votes each.

BRIGGS: Remarkable.

Virginia law says in the event of a tie, the election board will determine the winner by lot. The board of elections process involves printing the candidates' names on to equal-size sheets of paper, then putting them into a container. The first name drawn would be declared the winner. The loser could then petition for another recount.

A victory for the Democrat would split the House of Delegates control. A win for the Republican would mean GOP remains in the majority. What an intriguing process.

ROMANS: It really is.

BRIGGS: I want to see that live. ROMANS: You know, it's democracy. This is how democracy works.

BRIGGS: Draw it out of a hat.

ROMANS: All right, shots fired at the DMZ. South Korea opens fire after soldiers from the North pursue a defector. We're live in Seoul.


[05:13:53] BRIGGS: This morning, the U.N. General Assembly votes on a resolution rejecting President Trump's decision to recognize Jerusalem as the capital of Israel. And the administration says it will remember which countries oppose the U.S. position. America's U.N. ambassador, Nikki Haley, writing her fellow ambassadors to say she and the president will be carefully monitoring their votes and taking them personally.

ROMANS: That follows this tweet from Haley on Tuesday: When we make a decision at the will of the American people about where to locate our embassy, we don't expect those that we've helped to target us. The U.S. will be taking names.

President Trump pushing it a step further, warning financial assistance to nation would be cut off if they vote against the U.S. position.


TRUMP: Well, we're watching those votes. Let them vote against us. We'll save a lot. We don't care.

But this isn't like it used to be where they could vote against you and then you pay them hundreds of millions of dollars and nobody knows what they're doing, and we're not going to be taken advantage of any longer.


ROMANS: Let's go live to Jerusalem and bring in CNN's Oren Liebermann.

Oren, when is this going to happen and what do we expect?

OREN LIEBERMANN, CNN CORRESPONDENT: Well, Christine, President Donald Trump's threat to cut off foreign aid and Nikki Haley's threat there not expected to have any real impact on the outcome of this vote, and that's because it's expected to pass not only a little bit, but overwhelmingly. And if you want an idea of the kind of margin we're looking at in the 183-member United Nations General Assembly, take a look at a vote from a couple of days ago on Palestinian self- determination.

That passed 166 in favor and only 7 against or abstaining, Israel and the U.S. in that voting against category. And this vote, a vote to try to nullify president Trump's recognition of Jerusalem as the capital of Israel is expected to have much of the same result, even with Trump's threat and even with Israel instructing its diplomats to lobby against it. Again, it's expected to pass overwhelmingly, showing support for the Palestinian cause here, and in effect, Jerusalem, which was only supposed to be decided in final status negotiations, and that includes voting in favorite of it, the moderate Arab states that have a relatively good relationship with president Trump.

So, what's this all about, if we know the result already in advance of a vote? Well, because it's nonbinding, its real purpose is to show a stinging rebuke of U.S. foreign policy. And because this is an emergency special session of the general assembly, it's an even more powerful rebuke of where the U.S. stands on this one.

Christine, that is for the most part overwhelmingly alone.

ROMANS: All right. Oren Liebermann in Jerusalem, we know you'll be watching this for us. Thank you.

BRIGGS: Meanwhile, gunfire along the DMZ. It started when a North Korean soldier fled across the demilitarized zone toward the south. Later when North Korean soldiers appeared in the DMZ searching for the defector, the South Korean military says its troops opened fire as a warning to the North Koreans.

CNN international correspondent Paula Hancocks joins us live from Seoul with more.

Paula, this is a zone no one needs more tension in, but that is the situation we find ourselves in this morning.

PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Well, that's right, Dave. You certainly don't want gunfire along the DMZ. And while it wasn't direct military engagement between the North and the South Koreans, as you say, just an hour and a half after that defector came across the border, the South Koreans fired 20 warning shots as the North Koreans approached the border, clearly looking for that defector. And then shortly afterwards, they also say that they heard shots on the North Korean side of the border, but they didn't land in South Korea.

Now, what we know about this defector so far is he's young. He's late teens, early 20s, according to the South Korean military. They say that he's a low-ranking soldier, that he was armed as he came across but there was no incident. He's now in custody. He's being investigated.

But this isn't the first time this has happened. Just last month there was a very dramatic defection across the DMZ. A defector was shot four times by his former comrades. He was critically injured but has survived.

So, of course, it's raising the question now, why are so many more North Korean soldiers trying to make this very risky route across the DMZ? In the past, it was considered far too risky. There were four North Korean soldiers just in the past year that defected. There were four before that in the past five years. So, you can see how much it's increasing -- Dave.

BRIGGS: All right. Paula Hancocks live for us in Seoul -- thanks.

ROMANS: Breaking overnight, more than a dozen people hurt in Australia when a car plowed into pedestrians outside Melbourne's iconic Flinders Street Railway Station. Two adults and a young child with a head injury have been taken to the hospital in serious condition. Police have the driver and another person under arrest. They say the action was deliberate, but they are not specifically calling it terrorism.

BRIGGS: Also breaking this morning, in the Philippines, rescue operations under way after a ferry capsizes with 251 passengers aboard. Officials say 27 have been rescued so far off the coast of Luzon island, about 20 miles east of Manila. A coast guard official says the ferry was loaded under its official capacity of 286 passengers. The coast guard is coordinating with the military, adding possible air force and navy assets. We'll stay on that for you.

ROMANS: All right, and this shocking development -- opioids now kill more people in the U.S. than breast cancer. New numbers released overnight about the growing epidemic, no signs of slowing, actually limiting American life expectancy.


[05:23:41] BRIGGS: Well, if you own an iPhone, something you don't want to hear this morning, phone updates are actually slowing down older models.

Let's bring in CNNMoney correspondent Samuel Burke live in London.

Samuel, good morning to you. Lots of us have thought this for years, but why might it be happening?

SAMUEL BURKE, CNNMONEY CORRESPONDENT: This is an urban tech legend that goes back for years, but it turns out, it may not be so untrue, not like a lot of us tech people thought people were just complaining.

Basically, what people have always thought is when a new iPhone comes out and then they do an iOS update to their current phone, all of a sudden, it slows down, making them think Apple is trying to force them to buy one of the new iPhones like one you see on your screen.

Well, this morning, an Apple spokeswoman confirmed to me it's true, the iOS updates do slow down your phones if you have an iPhone 6, 6s or se, but not for the reasons people might suspect. They say basically what's happening is the battery peaks sometimes as it gets older, causing the phone to shut down, so they're sending out an update that will slow down the phone a bit but prevent that battery from peaking and shutting down, though I'm sure some people will still suspect otherwise.

BRIGGS: Yes, we certainly will. I've always wondered about this slowdown. Samuel Burke, thank you, my friend.

ROMANS: A CDC study says America is losing the battle against opioid addiction. New statistics show overdose deaths spiked to more than 42,000 in 2016.

[05:25:06] That's the most ever and more than annual deaths from breast cancer.

West Virginia, Ohio, and New Hampshire have the most overdoses. President Trump declared the opioid crisis a public health emergency in October but has not allotted any money to combat it.

BRIGGS: All right, ahead, Republicans are celebrating after passing this massive tax plan. Now on to government funding, which is set to run out tomorrow night, the Friday before Christmas.


ROMANS: This is what victory looks like. Republicans celebrate passage of an historic tax overhaul. Party might be short if the GOP can't approve a spending plan to keep the government open by tomorrow night.