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GOP Split Over Threat Of Government Shutdown; Navy Yard Reopens, No Motive In Killings; Mysterious Etchings On Killer's Gun; Water Quality Concerns In Colorado; Kidnapped Georgia Teen Found Alive; Waiting For $400M Powerball Winner; "Grand Theft Auto V" Sells $800M In First Day; Iranian Leaders Speaks Out On Nukes; Possible Katrina Link To Brain Eating Ameba

Aired September 19, 2013 - 10:00   ET

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

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CAROL COSTELLO, CNN ANCHOR: Happening now in the NEWSROOM.

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UNIDENTIFIED MALE: They think we're going to back off. They're wrong. They're on a different planet.

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COSTELLO: Washington at war. House Republicans demanding Obamacare be defunded. The state set for another possible government shutdown, and time is running out. Plus --

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UNIDENTIFIED MALE: Miss New York!

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COSTELLO: Within minutes of her historic win, she was confronted with hateful and racist tweets. How the new Miss America is handling her critics?

And this -- it's violent and controversial and flying off the shelves. The new "Grand Theft Auto" is apparently the hottest one yet. The second hour of NEWSROOM starts now.

Good morning. I'm Carol Costello. Thank you so much for joining me. On Capitol Hill, the clock is ticking and the risk of a government shutdown growing. With only enough money to keep the government running another 11 days, Republican leaders say they will approve new funding, only if Obamacare is defunded. Moments ago, the Senate Majority Leader, the Democrat, Harry Reid, spoke on the Senate floor.

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SENATOR HARRY REID (D), MAJORITY LEADER: Watching the Republican Party self-destruct, and that's not coming from me, that's what pundits are saying all over the country, it would be good political theatre to watch them self-destruct and that's what they're doing, if there were not so much at stake. The economic consequences of a government shutdown are deadly serious.

And, Mr. President, today, when I had my news briefing, the Republicans are openly fighting against each other now. Senate Republicans are saying, well, we don't have enough votes to get rid of Obamacare, but let's take it back to the House and let them hang tough. House Republicans are saying, why isn't Senate Republicans doing it themselves?

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COSTELLO: The president calls it extortion. Even some fellow Republicans disagree on the high-stakes political gamble in place because the fear of backlash from Americans who will feel the bite of a shutdown looms because many government offices would be closed along with museums and parks. Many federal projects will be delayed meaning contractors and subcontractors would be out of work and that's along with the many federal workers who would also be furloughed. Mail, however, would still be delivered. So there's your little ray of sunshine.

CNN senior White House correspondent Jim Acosta is in Washington with more. Good morning, Jim.

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: Good morning, Carol. Not many rays of sunshine here in Washington. This is sort of like one of those movies you've seen time and again, so you know all of lines. That is what's happening here in Washington with this prospect of a government shutdown because as we've heard many times before, here they go again.

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ACOSTA (voice-over): It's 11 days to a possible government shutdown and this latest budget battle pitting Republicans in Congress against President Obama is becoming the stomach-turning sequel to the sequel.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES OF AMERICA: What I will not do is to create a habit, a pattern, whereby the full faith and credit of the United States ends up being a bargaining chip to set policy.

ACOSTA: This time, the threat is all too real. Not only does the government run out of money October 1st, the nation is set to hit a debt ceiling and go into default starting in mid-October, seeing up a Washington dysfunction double whammy, the likes of which Americans have never seen before.

(on camera): Are we looking at sort of a gridlocked NATO?

JAY CARNEY, WHITE HOUSE CORRESPONDENT: If Congress fails to act, yes, it's possible. I'm not sure about the NATO part of it.

ACOSTA (voice-over): For now, Republicans in Congress say they will only vote on a spending bill that defunds Obamacare. REPRESENTATIVE JOHN BOEHNER (R), HOUSE SPEAKER: We are going continue to do everything we can to repeal the president's failed health care law.

ACOSTA: But that's not going to go anywhere on the Democratic- controlled Senate ramping the likelihood of a shutdown at the end of the month. We've been here before. A government shutdown has loomed four times since 2011. But each time, a deal was struck to avert disaster. Some Republicans say this is one rerun they don't want to watch.

REPRESENTATIVE PETER KING (R), NEW YORK: We can't let the government shutdown. We can't be kamikazes and we can't be General Custer.

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ACOSTA: We're going to hear the president hit on this issue of a government shutdown in about an hour from now when he meets with his counsel here at the White House. You'll see some of those comments later on CNN. Carol, at the same time, the White House is watching much of this battle from the sidelines as Republicans are attacking one another.

You heard Harry Reid talking about that just a few moments ago. That is because House Republicans are furious with Texas Republican Senator Ted Cruz who said yesterday that the Senate, at least on the Republican side, they don't have the votes to defund Obamacare.

That prompted a lot of House Republicans to go off on Twitter. One House republican, Sean Duffy of Wisconsin, accused Cruz of waving the white flag of surrender. And so 11 more days of this together -- Carol.

COSTELLO: Can't wait. Jim Acosta reporting live from the White House this morning.

Also this morning, a return to work, but far from a return to normal at the U.S. Navy Yard in Washington. The military complex reopened for business, just before dawn, three days after that murderous rampage, and investigators are still searching for clues as to what turned Aaron Alexis into a killer.

They know his mental health was crumbling. His paranoia making him delusional, but even his own mother is left with many questions. CNN justice reporter, Evan Perez, is working his law enforcement sources. So, Evan, what are they telling you about these etchings found on the gun Alexis used?

EVAN PEREZ, CNN JUSTICE REPORTER: Good morning, Carol. Yes, this is among the many clues that the law enforcement investigators are looking at. They're basically still trying to figure out, there's so many unanswered questions that they have. There are things, so many puzzling things that they've found.

One of the things they found was on the shotgun that he used on Monday. He had etched the couple of phrases. One said better off this way and the other one said my elf weapon. Now no one knows right now what those -- especially the "elf weapon" refers to. It could be something video game related. It could be some Navy phrase.

It's one of the puzzles that they have today. They also found in searching his laptop, they found that he had some kind of online alias in the name of Mohammed Salem and apparently they're trying to figure out whether or not this means anything. They don't think he was a Jihadi or had any interest in any kind of religion views. He dabbled in Buddhism. So, again, this is among the many puzzlers that they're still trying to figure out today.

COSTELLO: Yes, because we all thought he didn't really have an online presence.

PEREZ: Well, you know, he didn't have much of a social media presence. He was apparently a big video game player, but apparently not much of a social media user. And this online presence, I should say, there's no content. There's no web site that essentially has any kind of writings or anything like that. It's one of those things that they're, you know, just unexplained at this time.

COSTELLO: So many questions remain. Adam Perez, thank you so much.

PEREZ: Thank you, Carol.

COSTELLO: Checking our other top stories this morning at 8 minutes past. Receding floodwaters in Colorado give way to rising concerns about what might get into the ground water. Fuel, heavy metals and fluids used in fracking, a process that cracks the ground for drilling, might be mixing with the floodwaters and possibly be seeping into the water supply. More than 1,800 oil and gas wells had to be turned off.

Right now, the Colorado Oil and Gas Association says there are no reports of leaking wells, but a leak isn't really the issue, it's the chemicals and toxic fluids that might combine with the floodwater, and that water could end up in lakes or rivers used for drinking. Scientists say the state will have to be vigilant about testing and fixing any problems.

Police in Georgia are looking for at least two more possible suspects in the abduction this week of a 14-year-old girl. Two other men have been arrested. Ayvani Perez is in good health and now back home with her family after she was kidnapped during a home invasion.

Someone is waking up $400 million richer this morning. A winning Powerball lottery ticket was sold at a store in Lexington, South Carolina, near Columbia, actually at that store right there. No one has come forward yet with the ticket. In South Carolina, winners can remain anonymous. The jackpot was $400 million, but after taxes it will be closer to $223 million. The winning numbers, by the way, 7, 10, 22, 32, 35, the Powerball number, 19.

It was one of the most anticipated video games of the year. Now "Grand Theft Auto 5" has left its competition in the dust. I mean, left its competition in the dust. The controversial game generated more than $800 million on the day it hit store shelves. That would be a new record for first-day sales.

Alison Kosik is at the New York Stock Exchange to tell us more. Good morning.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Good morning, Carol. Can you believe it? Crowds actually lined up to buy this game, which by the way, rewards stealing and killing in the virtual world. For Take Two Interactive, the company who makes "Grand Theft Auto V," the cult following really continues to pay off for them.

As you said the company made $800 million in sales of the game in just one day, the first day of sales, amazing. We're hearing it could be a one-day sales record. You look at its rival, Activision. Activision makes "Call of Duty." Its latest version, it sold only $500 million on the first day.

"Grand Theft Auto" does do better partly because it doesn't release new versions as much. When "Grand Theft Auto" first came out, the fourth one, it came out five years ago. So these gamers were really chomping at the bit for a new one to play -- Carol.

COSTELLO: So let's talk about traditional video games. They're in stiff competition with online games and mobile apps. What does the success of "Grand Theft Auto V" mean for traditional gaming?

KOSIK: You know what it shows? It shows that traditional gaming, it's still alive. It's thriving even after "Grand Theft Auto" has been around, what, for more than 15 years now. So the fact that it's breaking records after all this time, it really is incredible. No surprise here, shareholders are really happy.

You look at shares of Take Two. They're up more than 55 percent this year. They're up another 2 percent today. However, they also got their name out there because of some controversy. The game has players compete, complete these heists. They have to traffic guns, they kill police and civilians. The games involve drugs, you know, all this stuff that makes life worth living -- Carol.

COSTELLO: Well, just so they stay encased within that game and your living room or wherever.

KOSIK: I hear you.

COSTELLO: Alison Kosik, thanks so much.

Still to come in the NEWSROOM, strong-arm politics on Capitol Hill as the government inches towards a shutdown. We'll take a closer look at the gamble and the potential payoff next.

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COSTELLO: This morning, Americans awaken to an increased threat of a government shutdown. Remind you all of a particular Bill Murray movie? Yes, you remember that movie. Broken or not, the clock is ticking towards September 30 when federal funding runs out and the government teeters on a shutdown. Today that threat is more real as Republican leaders say they will approve new funding only if Obamacare is defunded. The president is calling it an extortion, but one of our guests, Amy Kremer. You know her. She is exuberant. She is the head of the Tea Party Express and she this e-mail saying, we did it.

After traveling the country, rallying support to kill Obamacare, Kremer told reporters, quote, "This is a huge victory for the Tea Party. Once again proves that we are a strong force and won't be ignored. While we won this battle, the war is not over.

Amy Kremer joins us now, along with Jason Johnson, an HLN contributor and Hiram College, political science professor. Welcome to you both.

COSTELLO: OK, so Amy, you're celebrating this morning, but a lot of people are pretty angry about this. So tell them why they should be.

AMY KREMER, CHAIRWOMAN, TEA PARTY EXPRESS: Well, it is a victory. We didn't even think that leadership in the House would bring it to the floor for a vote and they're bringing it to the floor I believe tomorrow. So it's a huge victory for us. It shows that when we work hard. We can accomplish something and the Tea Party Movement is still here.

COSTELLO: Do you think it will pass in the House and go on to the Senate and pass and hit the President's desk?

KREMER: I think it will pass in the House. They're going to vote tomorrow and hopefully it passes in the Senate. We have a lot of work to do in the Senate and that's what we're going to be focused on other the next ten days.

COSTELLO: But why tie Obamacare to the federal budget? We still live in a fragile economy, right? Why take a chance? Why not fight Obamacare another way?

KREMER: Well, one of the reasons the economy's doing so bad is because of Obamacare. The bigger question I think or the correct question is why would we implement and fund a program that was passed into law three year ago and is still not ready for prime time? Even the president has admitted that because parts of it he's delayed.

He's delayed for big business. He's delayed for Congress. Why not delay for middle class average Americans? Why can we not defund this, delay it for a year, and let's have that Obamacare debate that we never got to have because it was shoved down our throats? It passed with not one Republican vote.

COSTELLO: It still passed, went to the Supreme Court.

KREMER: People don't want it.

COSTELLO: Jason, I really, in fact, polls show Americans don't understand what Obamacare is, 70 percent know very little about this law. JASON JOHNSON, HLN CONTRIBUTOR: Most think it's a bad idea. We've been seeing it in Oregon, in Washington, and in my home state of Ohio, premiums have been going down. So I think this idea we need to scuttle the entire American government and screw up the entire economy just for this particular bill, it's not a good idea. It won't pass through the Senate. Really, this is a lot of political posturing. This is just like all the votes to defund it before. It's not going to work.

COSTELLO: Even Ted Cruz came out and tweeted. Ted Cruz is a big Tea Party favorite. Even he says this doesn't have a chance. So why do it?

KREMER: I mean, I haven't seen Ted's tweet. Two weeks ago, everybody said it didn't have a chance of getting through the house and now we're bringing it to a vote. We're going to have to fight that battle. I think there are senators that need to be put on the spot and see where they are. This is the thing is that Democrats are coming out against this.

Max Baucus said it's a train wreck. When you have union leaders who helped promote this for the president, now they want out of it. I mean, the president and Harry Reid need to listen to the American people and not worry about scoring a political victory because this is what it is to them. No one's talking about the president. It's not the Republicans that want to shut down the government. We're going to totally fund the government. It's the Democrats that are talking about shutting down the government, if the --

COSTELLO: You tied Obamacare to a bill that would shut down the government if Obamacare's not defunded.

KREMER: The president has said if. If the sequester is not rolled back, he's going to shutdown the government. Why is no one talking about that?

JOHNSON: This doesn't make any sense. This is the problem, you see, first, you look at the republican leadership in the House, the vast majority, they weren't even around. They weren't in office in the last government shutdown. That is going to kill the Republican Party. Ted Cruz was graduating from lawsuit when the last government shutdown happened.

It's like people don't have institutional memory. Boehner was the only one in leadership but cantor and everyone else wasn't. This is going to be blame on the Republican Party. This is a battle that can be fought next year. The continuing resolution only goes to December 15th anyway. We're right back in this argument right before Christmas.

KREMER: This totally defunds it permanently. The continuing resolution only funds the government, the government spending until December 15th.

JOHNSON: In which case we're going to be back in the same fight. Whether we're talking about Obamacare or not, who wants to have this argument in front of Christmas? I think this is a bad idea overall. This October 1st when people have access to Obamacare, who knows, they may actually like it.

KREMER: They're not going to have access until January, but we don't even know --

JOHNSON: The vast majority of Americans are going to start signing up October 1st. I was a skeptic. I was a skeptic like you. We've seen in several different states the premiums are going down. The premiums at my college are going down. It's not such a bad idea.

COSTELLO: What you said about people not supporting it, especially union leaders, is true. Everybody who does not have health insurance now who cannot afford health insurance now, they actually are interested in Obamacare and how it might help them. And we're talking about millions, tens of millions of people.

And I want to make two points. Number one, that the Republicans came out yesterday with a plan to replace this out of the Republican Study Committee and there are free market solutions that will work so people can have access to health care.

Second thing I want to say in 1966, when Medicare was implemented, the cost was $3 billion. The projection of cost in 1990 was to be $12 billion. The actual cost in 1990 was $107 billion. It's going to be the same thing with this. We can't afford this.

Government is not the answer. Government's the problem. We need to get out of the way and pass free market solutions that will work, insurance across state lines, getting rid of pre-existing conditions that sort of thing.

COSTELLO: We've already debated all of these issues.

JOHNSON: It's amazing how they came up with these brilliant ideas at the last minute now that this is about to become policy.

COSTELLO: The Republicans brought up those ideas during the last debate and they were tossed aside by the Democrats. Let's be honest about this.

JOHNSON: They were tossed aside because President Obama wants this, and yes, it's political points. We can't be disingenuous here and think this is a disaster. There are ways this bill can be fixed. Once it's implemented and we see what happens. We're talking about projections down the road. We still have sequestration. We don't know if that's going to work. The idea of saying we know this is going to be doom and gloom doesn't make any sense.

KERRY: It doesn't make any sense when they have to sell it to the American people and they're spending hundreds of millions of dollars --

COSTELLO: Democrats have done a terrible idea of helping people understand. Bill Clinton will be on letterman on Monday night. I'm sure that's what he'll be talking about. What exactly this means. JOHNSON: Most of us are still skeptical. Costs have been going down in some states. It may end up working out.

COSTELLO: All right, I got to end this but we could go on and on. Amy Kremer, Jason Johnson, thank you. We'll be right back.

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COSTELLO: President Obama has called it a threat to our national security and to the world. The possibility that Iran could be pursuing nuclear weapons and now the nation's recently elected new president, Hasan Rowhani, who happens to be a former nuclear negotiator, is making this pledge about nukes.

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PRESIDENT HASSAN ROUHANI, IRAN (through translator): We have never pursued or sought a nuclear bomb and we are not going to do so. We are solely seeking peaceful nuclear technology.

UNIDENTIFIED FEMALE: Can you say that Iran will not build a nuclear weapon under any circumstances whatsoever?

ROUHANI (through translator): The answer to this question is quite obvious. We have type and again said that under no circumstances would we seek any weapons of mass destruction, including nuclear weapons, nor will we ever.

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COSTELLO: President Rouhani also opened up about a recent letter exchange with President Obama who contacted him after his June election and called the letters, quote, "positive and constructive."

Checking our top stories at 27 minutes past the hour, Senator John McCain wrote a scathing article about the Russian leader that was published on a Russian news site called Pravda. McCain's piece is titled, "Russians deserve better than Putin." McCain wrote, quote, how has Putin strengthened Russia's international stature by allying Russia with some of the world's most threatening tyrannies, but supporting a Syrian regime that has killed tens of thousands of its own people to remain in power," end quote.

Hurricane Katrina may be to blame for a brain-eating ameba for in a Louisiana communities tap water. The parasite killed a 4-year-old boy who visited St. Bernard parish last month. The 2005 hurricane left most of that area in ruins. State health officials think pipes that went unused for months, even years, helped breed the ameba. The parish is now flushing those pipes with chlorine.

If the latest iPhone upgrade isn't working for you, you might want to wait. Many iPhone and iPad owners say installation of apple's new operating system has been extraordinarily slow. It's likely the result of overwhelmed servers. Developers are also pushing out apps now optimized for the new system, so be patient. We'll be right back.

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