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CNN NEWSROOM

Interview with Rep. Peter King; GOP vs. GOP; Obama Calls for Vote; Cracks Showing Among House GOP; Government Shutdown; Interview with Rep. Erik Paulsen

Aired October 3, 2013 - 12:00   ET

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


REP. PETER KING (R), NEW YORK: The fact is, my district, my area of Long Island, Ronald Reagan carried it by over 100,000 votes. The largest vote of any county in the country. So this is a right of Senate (ph) district. Most of my district is strongly opposed to Obamacare. No one, almost no one is coming up to me and telling me to shut down the government. They realize that you play by the rules, that these issues are decided in elections. Unfortunately, (INAUDIBLE), we lost the last election. We lost the presidential election, the Democrats control the Senate. But the only way we can repeal Obamacare is by doing it the same way that they passed it, get it repealed in both houses of Congress and get a Republican president to sign that repeal into law. Well, the fact is, the way we're going now, we're never going to be able to do that.

ASHLEIGH BANFIELD, CNN ANCHOR: So - so it seem likes right now this is -- especially this week in particular, either the media is universally hated and we are targeted as evil doers for asking these tough questions. I'm sure you've heard about Dana Bash being attacked by, you know, Senator Harry Reid for daring to ask about piecemeal funding. And I've been attacked by both Democrats and Republicans for daring to ask such foolish questions that don't ally (ph) with their philosophies and their strategy. And then there's Ted Cruz, who's, you know, in a commercial lambasting other Republicans.

This is getting out of control. Is this now a battle for headlines and saving jobs on Capitol Hill, or saving speakerships, or is someone going to blink and finally realize people are hungry and they're living check to check and the economy is going to just collapse if you continue on with this, you know, with this impasse?

KING: Well, you know, there's a lot of blame here. First of all, I give Ted Cruz most of the blame. But let me -- I've been very critical of Republicans. Let me also say, it's time for President Obama to really step in. I'm not saying he has to negotiate on Obamacare, but he is the head of the Democratic Party. He's doing a very good job at that.

But he's also president of the United States, who's a nonpolitical position. He has an obligation to try to end this, do all he can. I can't imagine Lyndon Johnson or Franklin Roosevelt or Ronald Reagan just standing on the sidelines and giving an occasional speech. Whatever he has to do to try to resolve it, she should. I'm not even saying make concessions, but he, as the president has power, he can put things on the table. He can make it part of a larger deal. He can keep his Obamacare. That's -- he passed it. He's entitled to that. So it's up to us to try to repeal it. But he just can't continue to be on the sidelines.

As far as Ted Cruz, what he was looking for --

BANFIELD: Well, OK.

KING: To build up his reputation and also build up a mailing list. As far as -

BANFIELD: I think that's --

KING: Politicians who attack you, Ashleigh, I would never attack you.

BANFIELD: You're adorable. Listen, I'm going to -- I'm just going to push you on this a little bit because you just said, I'm not saying that the president has to negotiate on Obamacare, and that's a lot what, you know, the consensus about last night's meeting that went nowhere was that at least the Democrats right now are saying, look, we will start to work with you on the debt ceiling resolution and start making concessions down the road, but we're not going to negotiate here on Obamacare. So are you saying that what the president did yesterday was the right thing?

KING: No, I'm saying the president can be - I think more engaged. He's the president of the United States and rather than just say what he's not going to do, whether it's behind the scenes or whatever, a president of the United States can bring people together and whatever he has to do, try to make that deal. And whether it's, again, I'm not saying he has to negotiate Obamacare. Find a way to negotiate, to bring this to - to resolve it. He has the powers of the presidency and he should try to use them.

Again, Lyndon Johnson would have found a way to resolve this, I believe. Franklin Roosevelt would have found a way to resolve this. Ronald Reagan would have found a way. I'm not the president, but I'm just saying that he has to get in there. I think it's wrong when the rest of the world looks at this and they see our government shutdown and they see a president somewhat disengaged other than the occasional speech. If the government of France shut down tomorrow, and the president of France was not speaking out, we would have no idea who the speaker is. All we would know is that the president of France was on the sidelines. The president should be more engaged. I'm not being critical of him for being -- us being in this position now. But now that we are here, it is what it is and he's the president of the country.

BANFIELD: All right. Well, you know, I could talk to you for an hour.

KING: Right.

BANFIELD: In fact, it's an open invitation for you, Congressman King, to be on the show at any time.

KING: Thank you, Ashleigh. BANFIELD: I like your tone and I like the - I just appreciate -- you're just a straight shooter. Congressman King joining us live from Capitol Hill.

And I am flat out of time. In fact, I just stole four minutes from the next show. So I'm going to pass over the coverage now. Our continuing coverage of the government shutdown continues now straight ahead with Suzanne Malveaux.

SUZANNE MALVEAUX, CNN ANCHOR: This is CNN NEWSROOM continuing day three of the government shutdown. I'm Suzanne Malveaux.

MICHAEL HOLMES, CNN ANCHOR: And I'm Michael Holmes. Thanks for your company.

A fascinating interview there with Representative King. Quite extraordinary comments about Representative Cruz, which - or Senator Cruz, which is remarkable stuff, wasn't it?

MALVEAUX: Divided Republicans. We heard from the president just moments ago as well. He's making his case to the country. He's taking his case directly to the American people. Also, of course, his message to Congress, that paralyzing shutdown has to end so that American people can get back to work. The president says it could happen right away, right away, if House Speaker John Boehner just simply allows a clean vote on the spending bill.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: So my simple message today is, call a vote. Call a vote. Put it on the floor and let every individual member of Congress make up their own minds and they can show the American people, are you for a shutdown or not? If you're not for a shutdown, you'll vote for the bill. If you're for a shutdown, you won't vote for a bill. We don't have to twist anybody's arms. But that way the American people will be clear about who's responsible for the shutdown, or, alternatively, more hopefully, they'd be clear that this is something that doesn't make sense and we should go ahead and make sure that we're looking out for the American people. It should be that simple.

(END VIDEO CLIP)

MALVEAUX: So President Obama holding the Republican feet to the fire. He's pointing out that as a small group of Republicans who are preventing now the House from actually voting on the budget.

HOLMES: Yes, we're covering all angles of the shutdown for you this hour. We've got Brianna Keilar standing by at the White House, Dana Bash is on Capitol Hill, Christine Romans is going to tell us what you need to know if you are out of work with no pay because of the shutdown.

MALVEAUX: So, Brianna, let's go to you first here. This is something that we heard the president in very forceful terms for the last hour saying, look, there's not going to be negotiating over passing this budget to run the government. He said he would sign a bill today. All that has to happen is that House Speaker Boehner has to bring the bill to the floor. Can he do something else besides taking his case to the American people? Can he call Boehner aside, take him into the White House, one-on-one, face-to-face, and somehow make this happen, or is this the strategy that we're going to see in the coming days?

BRIANNA KEILAR, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, certainly I think the White House doesn't feel that that would be an effective strategy at this point. So this, Suzanne, going to the American people, frequently been his strategy when it comes to dealing with a divided Congress. And what he's really zeroing in on right now is well (ph) the division in the Republican ranks in the House. This is one of the reasons why Senate Democrats and the White House feel that they are in a position of strength here.

You know, and it's also interesting because he's dealing, of course, with some competing public opinions here, and that's why he's trying to sway it. Republicans, of course, have roughly half the country who are not fans of Obamacare. President Obama has more than half the country who say there should not be a government shutdown. So you also hear him trying to even appeal to some of the folks who don't like Obamacare by saying, you know, a shutdown doesn't actually shut down Obamacare. Obamacare is still up and running. And so he's trying to, I think, chip away at the public opinion that some Republicans are getting as well. But we're also hearing him emphasize more now the debt ceiling, Suzanne. So that's kind of the turn that we've started to see here in the last few days.

HOLMES: Yes, and, Brianna, too, you know, what we were hearing there from Representative King was, you know, the - bashing, really, Senator Cruz. And you can see these little divisions perhaps coming up between that hard core group of right wing Republicans who are behind this linking of Obamacare with the funding. What is the sense there about that? I mean is that something that they're talking about there at the White House?

KEILAR: The- that is something that they're definitely looking at in terms of the number of Republicans who are saying there should be a clean funding bill. President Obama keeps now making the point that if that were to go to the floor, that that is something that would pass.

He is probably right. I think that's probably something that Dana Bash is hearing on The Hill as well. But there's something that Peter King said that sort of struck me as well. Not only was he attacking a member of his own party on their tactics here, but he was also saying that he thought President Obama needs to be more involved here. But he also said he's not saying he needs to negotiate on Obamacare. So there you had it, really this division between these moderate Republicans and some more conservative Republicans.

HOLMES: Yes, extraordinary stuff. Bri, thanks so much.

Let's switch over to Capitol Hill now, the epicenter of the impasse, if you like. And we were hearing from Republicans, again, making their case against Obamacare. Let's have a listen to that before we go to Dana. (BEGIN VIDEO CLIP)

REP. ERIC CANTOR (R), MAJORITY LEADER: I think the speaker and I have both said that the Republican position is, we believe we should fund this government, but we also believe that this should not be any special treatment for anyone and that is why we believe the right solution to that is to provide for a delay of the individual mandate under the health care law.

(END VIDEO CLIP)

MALVEAUX: Want to bring in Dana Bash.

So, Dana, what we heard from the president here is pretty much the fact that, look, this could come forward for a vote, you get enough votes to support both in the Senate and the House, Democrats and Republicans, a clean spending bill here, this bill that would fund the government, the resolution, continuing resolution. Boehner refuses to do that at this point. Is there anybody, anybody that you're talking to that is trying to take him -- twist his arm, convince him and say, look, we just need to move forward with this and shut this thing down?

DANA BASH, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Absolutely, there are some people trying to do that. But what John Boehner has been doing, which is, by the way, down the hall behind me in his office, is calling moderates in in small groups saying, give me more time, I need more time.

The president is absolutely right, there are vast numbers of Democrats and Republicans who would vote for a bill to fund the government if it were on the floor. Congressman Devin Nunes from California was on with us last evening. He is a Republican. He wants this kind of bill. He says he thinks there could be 200 Republicans to vote for it. That would mean that this could pass by like 400 votes.

Here's the but. That group of 20, 30 hard core conservatives who are saying, you know, go, go, go, keep it going, they are powerful. And the very big reality for John Boehner and his fellow leaders is that if they were to go that route, they probably would not be -- there would be problems for them in their leadership. That's the reality that even the president knows that full well, Democratic leaders know that full well, what Speaker Boehner is up against. He didn't want to go down this route to begin with and now he's here and he's stuck.

MALVEAUX: And, Dana, that small minority there, what is it that they want? Is it a matter of some sort of concession of not raising debt ceiling? What is it that they're asking for now from their leadership - Republican leadership?

HOLMES: And if I could add a rider to that, why are they so powerful?

BASH: The reason they're so powerful is because they are -- well, let me just answer the first question from Suzanne first of what they want. One of the congressmen was actually quoted saying that they don't really know what they want, and that is part of the problem. Many of them come from extremely conservative districts and they're getting phone calls from their conservatives say, go, go, go, keep it going, shut it down, and that's the kind of feedback they're getting. It's not the, you know, what's going on with you guys in Washington? And that's what makes them so powerful because they're getting that advice or the applause from their constituents back home.

The other thing that make them so powerful is that they are a pretty hefty part of the Republican Party and they are being egged on by, you know, Ted Cruz and his grassroots. He does have a very important group of people out there who he has also been egging on all summer long and a lot of members of Congress are concerned about being the ones to sort of push John Boehner publicly because -- these are Republicans I'm talking about -- because they're concerned about getting a primary challenge from the right.

So there's so many different dynamics in here. It's not just about the sort of the vast public opinion, as Brianna was talking about. There are very important constituencies. Small as they might be, but very powerful in these particular districts that are driving this.

MALVEAUX: All right, Dana Bash, thank you so much. Michael and I have so many questions, we're just bombarding you with all of them.

HOLMES: Yes.

MALVEAUX: But we appreciate - you know, we'll get back to you as soon as there's some developments, as well Brianna Keilar.

Christine Romans, we want her to stand by. We want to talk with you as well about what people can do essentially if they're furloughed. And we're going to get to all of that after a quick break here.

(COMMERCIAL BREAK)

MALVEAUX: The government shutdown has furloughed almost 800,000 people.

That is just people who work for Uncle Sam, does not even include the people who work for companies with government contracts.

HOLMES: Yeah, take this, for example. The company that makes Black Hawk helicopters, Sikorsky Aircraft, now it could sent as many as 2,000 people home starting next week if the shutdown continues.

Here is just a fraction of the other agencies either slowed down or completely closed right now.

MALVEAUX: The U.S. Commerce Department, more than 40,000 people are not working today. Half the Department of Defense civilian workforce, 400,000 people, they've been furloughed.

The shutdown does not apply to active-duty military men women.

HOLMES: So no troops are furloughed, at least for now. And also for now, military paychecks are not affected.

And the Peace Corps is not bringing anyone home from overseas duty, but most Peace Corps employees here in the United States are furloughed. That's another 620 people to the list.

MALVEAUX: So furloughed government workers suddenly have to wonder, what are we going to do now? What -- how do we pay our bills? How do we support our kids?

Should they file for unemployment? What happens if they can't even make their own mortgage payments, right?

HOLMES: Yeah. Exactly. And, also, who's next? It's not just government workers, but those caught up in the spillover effects, like we were saying.

Our Christine Romans joins us now. Christine, fill us in. You're good at this. What options does a furloughed worker have?

CHRISTINE ROMANS, CNN BUSINESS ANCHOR: And so many federal workers, you guys, right now are trying to decide if it lasts just this week, I'm not going to file for unemployment; that's too much of a pain.

But if this is going to be something that lasts through October then it starts to make sense filing for unemployment benefits, and that's what so many hundreds of thousands of federal workers are considering here right now.

So furloughed workers are eligible for jobless benefits, and jobless benefits are not affected by the shutdown. That's part of the mandatory spending part of the budget.

But, beware, you might have to pay it back. If there's a retroactive pay for furloughed workers, you might have to pay it back, you guys.

And watch out for taxes. That's something that could be an issue if you don't have your -- if you don't have your withholdings correct, you might have to pay taxes on the jobless benefits and you're trying to figure out the part -- it could be just kind of a hassle. So you want this to be over quickly.

Another quick point for people, if you have student loans, so many of you do, right, and you're trying to figure out how to pay the student loans, look up, research something called economic hardship deferment.

Try to get a deferment or a forbearance. Do it, student loan experts say, in one-month increments if you can.

Start investigating that immediately to try to get some relief from your student loan bill while out of a job.

MALVEAUX: And, Christine, as this thing progresses, day by day, potentially week by week, is there anything that you advise people not do, that actually might be a downfall if you're in a situation where you are not working?

ROMANS: You have to be really careful about trying to raid your retirement to pay your bills.

We've seen it, again and again, that people raid their retirement because they think they'll be able to pay it back. Even if they take a loan, they think, oh, in just a couple of months, I'll be able to pay it back. And then you can't. Life gets in the way and you can't.

The penalties of raiding your 401(k) can be pretty significant, even if you take a loan on the 401(k) and you can't pay it back.

A lot of government workers have something called a TSP. It's just like -- it's like a thrift savings plan. It's just like a 401(k), same kind of rules.

Investigate it very carefully. You want to look at the withdrawals and the fees. And you have to remember, your intentions can be great, but a lot of times people in a pinch, they raid their retirement and then they can't pay it back, and then they've lost the nest egg.

And, remember, touching your retirement is the sign of economic Armageddon for your personal finances. You must try to do everything else before that.

HOLMES: Yeah, Christine, as always, thanks. Appreciate your advice. And I know something that you're watching as well, we're going to have a look at now.

Day three of the government shutdown, Wall Street increasingly concerned about a possible default, that is the debt ceiling.

You heard the president last night saying that Wall Street should be worried. Look at that, down one-and-a-tenth percent. The European markets were down again.

And the International Monetary Fund Managing Director Christine LaGarde, warning about the debt ceiling, saying it's a threat to the global economy. It's not just in this country people are worried about it.

MALVEAUX: And there's something that's happening within the Republican Party, They are split.

There are some Republicans who are pushing their party, pass a clean budget bill, no strings attached.

We're going to hear from Republican Congressman Erik Paulsen from Minnesota who says that he's willing to break away to get this budget passed, up next.

(COMMERCIAL BREAK)

MALVEAUX: A few Republican members of the House, they are now breaking with the majority and their leadership in hopes of ending the shutdown, getting the government simply back to work.

HOLMES: Yeah, they're pressing for a new funding bill, one without the demands on President Obama's healthcare program.

Minnesota Republican Erik Paulsen is one of them. He even tweeted these words through his followers, quote, "During the shutdown I have asked to have my pay withheld."

MALVEAUX: Congressman Erik Paulsen, he is joining us live from Capitol Hill.

And, Congressman, so you say you're willing to work for no pay, that's what a lot of folks are having to do now who are furloughed to get to the end of this here.

The president brings up a very good point. He says, look, if Speaker Boehner simply brings this is to the floor by our count, by Dana Bash's count, there are enough Republicans as well as Democrats to get this thing passed.

Do you have any influence? What can you do or your caucus do to get Boehner to bring that to the floor?

REP. ERIK PAULSEN (R), MINNESOTA: Well, this is where I'm trying to influence, and thanks for having me on today.

There are ways forward, and the speaker knows this. I had a conversation with him yesterday as well, and there are bipartisan ways forward.

In order to resolve this, and we want to see this resolved, there is going to have to be bipartisan support.

The medical device tax repeal is the only proposal that had the most bipartisan votes coming out of the House and has the opportunity in the Senate to gain tractions, and it fixes a part of ObamaCare in terms of repealing an awful tax.

And it's got bipartisan support. And then we can address the situation, of course, of reopening the government.

So it's a great opportunity. It could be the real linchpin, the real linchpin, to move this opportunity forward.

And I think our leadership recognizes that as well.

MALVEAUX: But, Congressman, you know what the president would veto such a bill.

He would not under any circumstance sign a bill that either changes, defunds or changes in some way his ObamaCare plan.

PAULSEN: Well, first of all, it is important to note, though, that -- I don't think it's helpful to have finger--pointing, to have lines drawn in the sand. People need to sit down and talk through it.

Seventy-nine senators also voted to repeal this device tax as a part of their budget debate. There are Democratic senators.

And knowing we're going to have to have that bipartisan component to resolve this situation, this is a way forward.

And members, rank-and-file members, are bringing this forward as well. You're going to see more attention on this issue in the near future.

And, you know, the White House, I think, may come along, if they have some pay-fors for it. That's been an issue in the past.

And, so, we're keeping that door open, and I think they are as well.

HOLMES: So perhaps that is a carrot. That is something that can be offered up in this negotiating thing.

But something we asked Dana Bash earlier, I'm curious. You're on the inside there. We're hearing other Republicans say, there's this 20, 30, maybe 40 hardcore conservatives who are behind all of this and there are a lot of moderate Republicans going, we're getting dragged into it.

Why is that core group so powerful within the GOP?

PAULSEN: I think right now everyone feels they've been dragged into it. And, actually, even the conservative, real hard-line conservatives that wanted to take this line of strategy, have now actually modified their positions and have voted for just the medical device tax repeal or just the one-year delay in the mandate.

So we've all kind of gotten dragged into it. My constituents want to see resolution. I think most lawmakers want to see resolution now.

I think we need everyone just to sit down and actually talk. We have averted past shutdowns, just two years ago, for instance, when both sides were talking.

And, unfortunately, we don't even have these conversations going on now.

HOLMES: But this was led by Senator Cruz and those who are along with him. A lot of Republicans aren't happy about that. Why are they so powerful?

PAULSEN: Well, first of all, the challenge for anyone who's in leadership is getting everybody on the team to move forward with unity, and that's been a challenge for sure on the Republican side right now.

But in the end, there's no doubt. I'm not a supporter of ObamaCare. I voted to repeal it, to defund it, et cetera.

But we do need to move on. We'll get through this next election. We'll have an opportunity to really make a difference.

But we can dismantle parts of the law and this medical device tax has bipartisan support to do that. I think it's a linchpin to move it forward. I'm going to continue to work hard to make sure that that happens as well.

So it's not just one faction. I think a lot of folks now recognize we've got some challenges that we can meet, and what are the ways forward? That's what we need to figure out soon. MALVEAUX: And, Congressman, I want to bring up, this is Senator Barbara Boxer. She's explaining here how things could move forward, and, of course, that is the speaker bringing the legislation before the House.

I want you to hear how she put this.

(BEGIN VIDEO CLIP)

SENATOR BARBARA BOXER (D), CALIFORNIA: Speaker Boehner could just bring up that vote right now, in five, ten minutes, and we would open the government and then we would sit down and talk about all of the things they care about.

What's really interesting is that the Republicans in the House have been gutting the NIH, so I'm glad they now care about it. That's good.

(END VIDEO CLIP)

MALVEAUX: So, Congressman, I mean, how long does this go on, until there is some sort of movement or demand to get the speaker to the floor to make this thing happen, to move this forward. I mean, he is the one person who can do that.

PAULSEN: Well, I would point out this, though, because when the House did pass a couple of our bills we sent over to the Senate, they did avoid the vote on the medical device tax.

They combined it with another bill, so Senator Boxer had an opportunity to break it apart.

If we can get that vote separately in the Senate, it's exactly as she said. There will be bipartisan support. We can resolve it.

So it's not just the speaker holding something up, it's actually the majority leader in the Senate.

And this is where both sides need to figure out, come together, and talk. Our constituents demand that. Certainly as an elected official I want to see that happen.

MALVEAUX: Are you talking? I mean, can you tell us what's going on?

PAULSEN: There is -- there are conversations. In fact, there's a group of growing members, mostly younger and newer members that haven't been here as long that are trying to break the logjam to make sure that issues like the medical device tax repeal are entered into the debate, are entered into the discussion.

I had my conversation with my leadership, Speaker Boehner, yesterday and he said, hey, this could be a possible way forward. So that door's not closed.

I've also been speaking with my U.S. senators from Minnesota, and they're open to the idea of repealing the medical device tax, too. So it's just kind of a - maybe it's a matter of just getting actual sit down at the table with some of the leaders and we can get the rank-and-file members behind it.

HOLMES: And very quickly, too, I mean, because, you know, people watching all have opinions on this.

I mean, Congress has a 10 percent approval rating. Are you surprised?

PAULSEN: No, I'm not surprised at all. I'm not in the approval rating -- support the approval rating as well. Congress is broken. Washington is broken. And, you know, it's the president who's doing the finger- pointing as well.

And this is where I think folks are just expecting us come together to sit down. We've got the challenge with the debt ceiling coming up. You know, the vast majority of the public says that shouldn't be negotiated over. It's not a line in the sand, as well.

And we need to be prepared for that, to have those serious talks, negotiations, to get it right because a 17 trillion debt, that's nothing to scoff at.

We need to address that with future plans as opposed -- and make sure we don't default, obviously.

But we've got to have a plan in place so it's reformed and fixed in the future.

HOLMES: Congressman Erik Paulsen, thanks so much. Appreciate you being with us today.

PAULSEN: Good to be with you.

MALVEAUX: And at least he's talking about talking.