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Salmonella Outbreak Investigation; Obama News Conference at 2 P.M.; Could Obama Use 14th Amendment to Raise Debt Ceiling; Stocks Down in Triple Digits

Aired October 08, 2013 - 13:30   ET

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

WOLF BLITZER, CNN ANCHOR: Foster Farms says no recall has been announced.

Let's bring in Elizabeth Cohen, who is digging into this story for us.

Elizabeth, this involves several federal and state agencies. But people want to know all over the country, is our food safe?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: Foster Farms, the folks who productive this chicken, associated with the salmonella outbreak, they say it is safe. On their website, they put this: "No recall is in effect. Products are safe to consume if properly handled and fully cooked." So they say go ahead and eat this chicken. You don't need to throw it away. That is from their website, capitalization and all. They say go ahead and eat the chicken. You don't need to bring it back to the store or throw it away. They say it's safe to consume if properly handled and fully cooked.

BLITZER: We know the partial government shutdown has affected some parts of food safety investigations. Various agencies have different degrees of furloughs. What can you share with us about this, the impact of the government shutdown and the safety -- and the health of our food, if you will?

COHEN: It's interesting, we asked the USDA, is there any kind of link between the salmonella outbreak and the partial government shutdown. They said, look, no, we did our investigation before the shutdown even happened. There is no contention.

It's interesting, the CDC, they let go most of their people who were involved with their food-borne illness investigations, and recently they brought some of them back. So I think that says something right there, that they felt the need to bring some of them back.

I also wanted to read to you a tweet from the director of the CDC, Dr. Thomas Frieden. He said, in a tweet, "The CDC had to furlough 8,074 people. They protected you yesterday and can't tomorrow. Microbes, other threats didn't shut down. We are less safe." So when you see a tweet from the director of the CDC saying we are less safe, it certainly gives you pause.

BLITZER: Yeah. He's a very smart guy. Tom Frieden, a very smart guy.

COHEN: He is.

BLITZER: Thanks very much for that.

Once, again, we are waiting for President Obama. He will be in the White House briefing room making a statement on the government shutdown and answering reporters' questions. We will check in with all of our reporters and analysts right after this.

(COMMERCIAL BREAK)

BLITZER: President Obama goes before the cameras and the microphones shortly on day eight of the partial government shutdown. He is scheduled to make a formal statement at the top of the hour and take reporters' questions in the White House briefing room. Earlier, the president called the House Speaker John Boehner and reiterated he will not renegotiate on the threats involving the government shutdown and the debt ceiling. He is willing to negotiate after those matters are resolved.

Let's bring in our senior White House correspondent, Jim Acosta; and chief congressional correspondent, Dana Bash. They are both standing by. We are all watching what is going on.

Jim, a quick question to you because I was a little confused earlier. The vice president, Joe Biden, a lot of people are suggesting he's been missing in these discussions involving the government shutdown and hasn't been visible publicly, but I assume playing a role behind the scenes. I know you checked to see if he did attend that meeting that the president had last week with the four Democratic and Republican leaders in the House and Senate. Was he there?

JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT: He was there, Wolf. It's interesting to talk about the vice president's role in all of this. He was instrumental in brokering a deal to avert physical catastrophe the last time this came up in 2011. He was apparently talking behind the scenes with the Senate majority leader, Mitchell McConnell, extensively.

From my stand point -- and I know other reporters have asked this question as well -- what has the vice president been doing in this current standoff. One thing I heard from a Democratic source, who would have some knowledge as to what is going on here at the White House and these negotiations, these discussions with Congress, the way it was explained to me, Wolf, is that because Mitch McConnell has also been very silent through much of this, he is facing a primary battle back in Kentucky as he is running for re-election. He is basically being primaries by the Tea Party in Kentucky. He has a tough re- election battle. According to that source, Mitch McConnell has pulled back from the discussions. Mitch McConnell and Joe Biden were sort of working together in that last standoff. The fact that Mitch McConnell has sort of faded into the background kind of explains, in the words of this Democratic source, why Joe Biden has not been quite as visible. But as you mentioned, Wolf, sometimes these discussions are going on and they are not read out to the news media. Jay Carney, the White House secretary, said that to me the other day in the briefing room, sometimes these conversations are not read out to reporters for political reasons. And perhaps because John Boehner, the speaker of the House, doesn't want those calls right out because, you know, people in the Tea Party might be upset with the House speaker if it's known he is having lots of conversations with the president.

But I have also been told by White House officials, this time around, we are not seeing as many conversations between the president and House Speaker John Boehner as we saw in the last standoff, mainly because both sides are so locked into these positions, these polarized positions, that there really hasn't been that much to say at this point. Perhaps because of that conversation earlier this morning, that is starting to change a little bit -- Wolf?

BLITZER: Maybe it will. Maybe that conversation will be followed up by an actual one-on-one meeting the president of the United States and the speaker of the House.

Dana Bash is watching all of this and is back up on Capitol Hill.

Dana, you were right earlier when you suggested that the vice president was in that meeting. And we wanted to double or triple- checked if, in fact, he was. He's really experienced, Joe Biden. He knows the players. He knows the issues. No one knows the legislative role as Joe Biden. It's been a little intriguing why we haven't seen him play a more visible role. But your analysis earlier and Jim Acosta's analysis spot on. What do they want to hear from the president, the Republican leadership, when he goes before the cameras in about 20 minutes now?

DANA BASH, CNN CHIEF WHITE HOUSE CORRESPONDENT: What do they want to hear? They want to hear he is willing to negotiate. Do they think they are going to hear it? I don't really think that they believe that. They understand inside the Republican caucus, inside the walls of Republican leadership offices where the president's position is. He has made it abundantly clear, never mind to those of us in the public and those of us in the press, so many times. He did call the Republican leaders, the Democratic leaders down to the White House for the meeting you were just discussing with the vice president last week, and he was very stern, we are told, by sources in both parties, about the fact he is not going to negotiate specifically and especially on the debt ceiling. You hear Republicans say so many times that every president has negotiated in some way, shape, or form for something to raise the debt ceiling. Democrats argue that might be true, but up until the 11th hour and not down to the wire we are right now and as we were two years ago in 2011.

So I think in their heart of hearts, Republicans probably realize that. But you know what? We are in a very different world than we were even two years ago because of the fact that John Boehner has gone down this road that he didn't want to go down to begin with, negotiating first on Obamacare, on the spending bill, and now on the debt ceiling. He really wanted to start off, Wolf, with the debt ceiling. He wanted to put all of their eggs in the debt ceiling basket with regard to negotiations and it got a little muddled and I think Republicans up here on Capitol Hill can see that. So that's why they are having a hard time getting back on the message train, if you will, and the president has been very consistent, I'm not negotiating. You know, we have to pay our bills. We have to pass the debt ceiling increase and we have to fund the government. I'm not negotiating. I will afterwards but not beforehand.

So my suspicion is that we are going to hear a lot of that reinforcement of the message from the president, just like we will from Democrats, who are just down the hall behind me in the Senate having their weekly lunch, as are Republicans.

BLITZER: Looks like that stalemate, at least for now, continues.

Dana, thank you. Don't go too far away.

Jim Acosta is over at the White House getting ready to go into the briefing room himself.

Here's a question: Could the 14th Amendment to the Constitution be used to raise the debt ceiling? We will tell you how some are floating that idea and how it might work.

(COMMERCIAL BREAK)

BLITZER: Only 15 minutes or so away from the president of the United States getting ready to go into the White House briefing room, make a statement on the government shutdown, and then answer reporters' questions. We will have complete live coverage here on CNN.

Short of the deal with Republicans to raise the nation's debt ceiling, is there another way to either raise the debt ceiling or keep paying the nation's bills? Back in 2011, the former President Bill Clinton suggested the 14th Amendment to the Constitution potentially could be used to avoid a government default. And here is why. Part of the amendment says this -- I'm quoting -- "The public debt of the United States shall not be questioned." Back in 2011, the White House rejected the idea of using that 14th Amendment to take action on its own, but this time, it doesn't appear -- maybe not completely to be ruling it out, although some officials say the president has no intention of doing so. Some members of the Senate, including the Senate Finance Committee Chairman, Max Baucus, say it needs to be taken into consideration, that 14th Amendment option.

Would the option hold water legally?

Let's bring in our senior legal analyst, Jeffrey Toobin.

Jeffrey, what do you say? Is in the 14th Amendment, could it, in an emergency, be used by the president to go ahead and raise the nation's debt ceiling, pay off of the U.S. existing financial obligations without a formal vote in the Senate or the House?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Wolf, this is one of the paradoxes of the Constitution. Article I of the Constitution very clearly says it's up to Congress to borrow money, to spend money. That is the power of the purse that Congress has. But then, as you just pointed out, there is this 14th amendment, which somewhat mysteriously to some suggests that the president, on his own, without Congress, could pay the United States debt. I think it is a possible argument that could be made. It is not clear that the courts would step in. They might say this is between the president and the Congress, we are not going to get involved. But as a political matter, putting aside the legality, I think it's very, very unlikely that the president would undertake this kind of thing to do.

BLITZER: We had a little abbreviated version of that 14th Amendment. The Section IV of the 14th Amendment says, "The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion shall not be questioned." This was done right after the Civil War. Some have argued, well, maybe this is applicable to the Civil War and, you know, what were call debts incurred for payments of pensions and bounties for services but would not necessarily be the same as far as paying debts the U.S. has to foreign countries who buy T-bills or whatever. What do you say?

TOOBIN: It's important to point out that no president has ever tried this. And just talking about the politics of it for a second, if the president were to suggest that he might be doing this, it would take all of the pressure off Congress. Congress would simply say, well, we don't have to deal with this problem. The whole point of the president's effort has been to put pressure on Congress.

Also, if the president were to do this, there is certainly going to be -- there are certainly people in Congress who would say this is an impeachable offense and this is something the president cannot do. It would shift the focus entirely from, is Congress doing its job to did the president violate the law? And I can't imagine the Obama White House wants to have that conversation when they can put the responsibility all on Congress, which is what they have tried to do from the beginning.

BLITZER: I know that the president does not want to use the 14th Amendment, and made that clear on many occasions, including today after that phone conversation that the president had with the House speaker John Boehner. Let me get that White House statement that was release. The last line of that statement says that the president, in the conversation with John Boehner said, he noted, meaning the president, he noted that "only Congress has the authority to raise the debt limit and failure to do so would have grave consequences for middle class families and the American economy as a whole."

So here, the president, in the statement from the White House, the press secretary said "only Congress has the authority to raise the debt limit." Might be settled law as far as we're concerned.

TOOBIN: The White House has been very consistent on that. The question remains, if the country is looking at an absolute financial cataclysm, looking at heading into a depression because of massive defaults, would the president step in and invoke the 14th Amendment? So far they have said absolutely not. The question remains, in a supreme emergency, would that happen? I don't think we know the answer to that question as least to a 100 percent certainty.

BLITZER: I think you're right, as you usually are.

Jeffrey Toobin, thanks very much.

TOOBIN: Thanks.

BLITZER: We'll have more with you later in "The Situation Room."

Once again, we're awaiting the president. He's going to have a news conference in the White House briefing room. He's scheduled to make a statement at the top of the hour, then take reporters' questions. We'll have live coverage coming up.

Will his words console investors out there? We'll get a market check after the break.

(COMMERCIAL BREAK)

BLITZER: So how's Wall Street taking the news of extending the nation's debt ceiling?

Let's bring in Alison Kosik. She's over at the New York Stock Exchange.

Alison, how much does wall street care about what's going on here in Washington?

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: It cares a whole lot. As you can see, the Dow down again the second day in a row, down in the triple digits. This is kind of wall street's way of firing yet another warning shot to Washington, saying it's time to find a solution, not just to the shutdown but to the debt ceiling issue as well. You know, they say, listen, the way wall street sees it, there's going to be more of this kind of selloff if Washington doesn't get its act together and come up with a solution on both of those issues.

The path of least resistance, as far as Wall Street sees it, is down. You look at the Dow, it's been down 10 of the past 13 sessions.

Most analysts expect stocks to stay under pressure until a deal is done. Most really believe that a default is unlikely. But here's the thing. If one does happen, Wolf, one analyst says the S&P 500 can drop 45 percent. You'd feel that right in your investments because the S&P 500 is what your retirement funds, your 401K funds closely, sort of track. The estimate it could drop 45 percent, that's a big deal -- Wolf?

BLITZER: That's a huge deal. A lot of people would be -- that would be a disaster for so many people.

Thanks so much, Alison.

We'll continue to watch the markets, see how it reacts after the president's news conference. He starts in a few minutes. We'll have live coverage after this.

(COMMERCIAL BREAK)

BLITZER: Hello, I'm Wolf Blitzer in Washington. We want to welcome our viewers here in United States and around the world.

This is CNN's special coverage of what could be a major moment in the standoff in this shutdown crisis with Congress. Any moment now, the president will speak live. He will make a statement and then answer reporters' questions at the White House briefing room. You're looking at live pictures on this, day eight of the partial government shutdown. And with the debt ceiling only nine days away, both sides are still saying it's the other guys' shutdown, the other guys' fault. The House Speaker John Boehner saying today he got a phone call from the president. The president apparently telling him he will not negotiate on a government funding bill or a debt limit increase.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER, (R-OH), SPEAKER OF THE HOUSE: -- our differences. But refusing to negotiate is an untenable position. And frankly, by refusing to negotiate, Harry Reid and the president are putting our country on a pretty dangerous path.

Listen, there's never been a president in our history that did not negotiate over the debt limit. Never.

(END VIDEO CLIP)

BLITZER: The White House says that is not how this call went down. Apparently, the president told Boehner he is willing to negotiate, just not under the threat of the government shutdown and the debt ceiling.

Now consider this. This whole thing could be over today if a clean spending billed passed the House of Representatives without any conditions attached. The speaker says there just aren't enough votes for that kind of legislation to pass. The president insists there are enough votes. So how about this? We've been doing a rolling CNN survey of the entire 435 members of the House of Representatives. There are two vacancies right now. It shows that this bill, potentially, if it were to get to the floor, it could get enough votes to pass, but only barely. By our count, 18 Republicans now say they would be willing to join all 200 House Democrats in favor of such legislation. If you do the math that would make 218 yes votes for this clean C.R., or continuing resolution. You need 217, given the two vacancies in the House right now. That would be a bare majority. But that kind of vote is not likely to come up unless the speaker would allow it to come up. They don't have enough votes to go around the speaker right now with a procedural maneuver.

Let's bring in our senior White House correspondent, Jim Acosta. He's standing by at the White House in the briefing room.

It was pretty hastily organized, today's news conference. Only a couple hours or so ago, they announced the president would do this.

ACOSTA: That's right, Wolf. As you know, he canceled that trip to Asia. The president has had some time on his hands. The White House usually provides a week ahead. They didn't even do that for this week.