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Winners and Losers; "A Political Weapon of Mass Destruction"; A Temporary Solution; North Carolina Cuts Off Welfare, Blames Shutdown

Aired October 16, 2013 - 16:30   ET


JAKE TAPPER, CNN HOST: Welcome back to THE LEAD. Live from Capitol Hill, I'm Jake Tapper.

In our politics lead, it was a war of attrition, and even while Speaker Boehner admits that the House Republicans lost this round, both sides of the aisle lost a lot of blood in this debt crisis.

Here to talk about losers and if there are any possible winners in this whole thing is our political panel: Republican analyst and former Bush campaign spokesperson, Jennifer Millerwise Dyck, CNN political commentator and former Clinton, Paul Begala, and Washington bureau chief for "USA Today," Susan Page.

Jennifer, I want to start with you. A lot of people, including the are wondering, whether John Boehner, the "Federalist" says, is it time for John Boehner to resign as speaker.

Congressman Tom McClintock, Tea Party favorite, reportedly says, "I would give him an A, I think he's done a good job." He got a standing ovation at the caucus meeting. You heard the congressman say a second ago, very strong, his position is secure.

Is that it? Is that the end of the story?

JENNIFER MILLERWISE DYCK, SENIOR DIRECTOR, APCO WORLDWIDE: I'm not sure anyone else wants the job or could get the job, first off. I mean, it is a little bit in name only. I think it's tough to say he's much of a winner through this. I think that the GOP brand has certainly been tarnished under -- more than it ever has been before, potentially in modern history, and that's certainly been under his watch. So I think it's really hard to say that he's someone who's been a real winner through all of this.

Having said that, I don't think there's anybody else who wants the job or could really get it at this point. So he may be able to continue to hang on.

JAKE TAPPER, CNN HOST: I'm sure that Eric Cantor would take the job if anybody --

DYCK: Probably, probably accept it but...

TAPPER: -- or Kevin McCarthy. I mean -- but, I take your point.

Susan, did Boehner have any choice at the end of the day, but to just take the Senate compromise and put it on the floor?

And now we hear from the congressman, it might even get a majority of Republican votes.

SUSAN PAGE, WASHINGTON BUREAU CHIEF, "USA TODAY": I don't think he had any choice at this point. He had certainly played out for his Tea Party -- the members of his caucus who support the Tea Party, he had played out a lot of string for them, right? We really got right to the edge of the cliff before he agreed to take this deal to the floor.

But I think at that point, he didn't have a choice. I agree that his brand is damaged. He's weakened. The next time around, and that's only going to be months away, right? He's going to be in a less powerful position when it comes to dealing with Barack Obama. This has not been a win for him.

TAPPER: And I wonder about the administration and how the White House is going to treat this. And Paul, our friend, Olivier Knox, the chief White House correspondent for Yahoo! News and a frequent panelist here, tweeted earlier today something I found very funny.

"'There are no winners here,' says White House, as anonymous Obama aides compare him to JFK in the Cuban Missile Crisis."


So I think there is a risk here. I already saw a piece in "The Hill" about Dan Pfeiffer, that brilliant strategist, and how he was the one behind President Obama. He was the ramrod that Joe Biden refers to in the president's spine.

Is there a risk on how the White House plays this?

PAUL BEGALA, DEMOCRATIC STRATEGIST: Sure, sure. And having worked there, Jennifer worked there, arrogance is like an epidemic in the building, and it certainly was when I worked there had and I had it. OK? So I feel their arrogance, but they still have a world of problems.

But the truth is, the president does win. There are winners here. The president emerges stronger because in part his coalition was fracturing before all of this began. The NSA spy incident, the drone attacks, the seeking to bomb Libya.

This was upsetting the Left and peeling them away from President Obama. Now the Left is united. And they've seen the power of unity. So, yes, the president -- when your biggest problem is, I might overplay my newfound strength, that's a high-class problem.

TAPPER: Jennifer, he has a point, because you saw even as ObamaCare, the launch of the website was, shall we say, less than stellar, or you can put it another way, if you want, it was not hiccup free, ratings for ObamaCare went up during this crisis. I can't believe that that's because it was so swimmingly successful.

DYCK: No, I think the Republicans gave him an incredible gift. Had Ted Cruz not led Republicans in the direction that they went, we would have been talking about what a disaster the ObamaCare launch was, and we would have been able to actually go through and maybe fix some of the problems that exist right now.

We gave him an incredible gift, because instead of talking about that, we were talking about how dysfunctional the Republican Party is. So I think he should say thank you, Ted Cruz.

TAPPER: You heard the congressman say that the individual mandate delaying that was really the final thing that House Republicans wanted before the government shutdown.

It wasn't defunding, it was delaying the individual mandate. Paul and then Susan, do you think if this hadn't happened with this problematic rollout of the ObamaCare website, would people who want to log in and join, having trouble doing so, do you think that would have even been on the table?

BEGALA: Certainly it distracted from -- you would not have seen what we saw, which is the popularity of ObamaCare going up, even as the rollout was troubled. And that is because of this distraction that we had here.

So it's an enormous opportunity cost that the Republicans have paid, but it's a real-world cost. Their brand is at an all-time low, and this is the best ObamaCare has been in a year or two.

TAPPER: What do you think, Susan?

PAGE: I think one of the winners we should talk about are women in the Senate. It was the women in the Senate who started the bipartisan negotiations that built a framework for the eventual deal, women chairman of the two key committees, Appropriations and Budget.

Women just make up -- there's 20 women senators -- that's a record, but it's only 20 out of 100, but they were the drivers behind getting over this negotiating deal moving on.

TAPPER: I've heard people say, Democrats and Republicans, Susan Collins of Maine in particular, the Republican senator, who was trying to broker a deal, in particular, is a -- I don't know that there are any winners, really, but at least she comes out a little bit better, her reputation, enhanced.

Senator Ted Cruz, he had some very critical words thrown at him by "The Houston Chronicle" today, the paper that endorsed him.

And in fact, the newspaper said, "Does anybody else miss Senator Kay Bailey Hutchison?"

Jennifer, dinged in his own state, in a newspaper that endorsed him for election, is he -- I can't tell where he is right now. He seems more popular than ever with the Tea Partyers and serious conservatives, but he doesn't seem to be more popular here in this building. DYCK: I don't think he was ever popular here with his colleagues. That certainly seems to be the buzz. I do think that when people have a chance to step back, they're going to look at this and say, he had no strategy. I mean, there was no strategy here. This was never something he was going to be able to win.

So he really drug a couple of people along with him, made this three weeks of just a complete disaster, has destroyed the GOP brand, and for what?

I hope that's what people realize at the end of the day, that he took us down this path for absolutely no reason whatsoever, on something he was never going to win. Had he kept his powder dry for a few days, he maybe could have made arguments about ObamaCare.

TAPPER: And Paul, isn't that the lesson here, that House Republicans -- and you can put Ted Cruz in there -- showed that there's actually a group less competent than the people behind the ObamaCare website?



BEGALA: I agree with everything except this, Ted Cruz is a big winner. The Republican brand is weighed down, but the Cruz brand is way up. I'm from Texas, I grew up there and I've talked to friends there today.

And the business community is furious. Business Republicans are furious. But the grassroots loves this. And we'll know soon. We'll see. I bet you you'll see invitations rolling in to Senator Cruz to come to the Reagan Day dinner in one state and the Lincoln Day dinner in another state, or whatever Republican -- he's going to be a huge draw. I think this is a big win.

So the lesson that he takes from this, I suspect is, I'm bigger than the party. The Democrats take the opposite lesson, which is, when we all stick together, it actually works out well for all of us. But I think the fracturing may continue and I think that Cruz is just going to be inflated by this.

PAGE: There's going to be a 2016 candidate for the Tea Party movement. There's been a battle among any number of Republicans who would like to have that. Ted Cruz has taken a big step toward becoming the standard-bearer for the Tea Party in 2016.

TAPPER: And there were thoughts that it might be Marco Rubio at one point, might be Rand Paul.

PAGE: And it still might be. There's still a little time to 2016.

TAPPER: But still, he's done well with that crowd.

BEGALA: In the middle of this disaster, he won the straw poll, the Values Voter Summit, very conservative and more Christian than Libertarian, meeting right here in Washington, at the worst of the shutdown. That tells me something.

TAPPER: Indeed. All right. Jennifer, Paul, Susan, thank you so much. Coming up next on THE LEAD, asinine. That's what Warren Buffett thinks of Congress using the debt ceiling as a political tool. Don't blame me for that word.

And even though the Senate has apparently worked out a deal, what are the economic consequences of doing this again, maybe in a few months?


TAPPER: Welcome back to THE LEAD, live from Capitol Hill. I'm Jake Tapper.

So what do the titans of Wall Street think of the possibility of a last-minute deal from Congress? Actually, they're pretty bullish over it. But that doesn't mean that the Oracle of Omaha, Warren Buffett, didn't have a bone to pick. Our Poppy Harlow caught up with him earlier today.


WARREN BUFFETT, CHAIRMAN & CEO, BERKSHIRE HATHAWAY: People play brinksmanship games sometimes, but it is totally asinine to have a debt ceiling at all and to use it as a means to try and get your way out of anything else, whether it's abortion, gun control, ObamaCare, you name it. It's a political weapon of mass destruction that shouldn't be used.


TAPPER: The host of CNN's "YOUR MONEY" and our newly minted chief business correspondent, Christine Romans joins us now.

Thanks for being here. Congratulations on the minting.

So how many other business leaders does Warren Buffett speak for?

CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: Just about all of them. I've never really in my career seen so much business speak with the same voice, sing the same song on something. Basically, look, congratulations, Washington. You've narrowly averted a fiscal crisis of your own making again.

If there's one thing you should be buying, it's stock in the countdown clocks because by the time we put this one away, we'll have to turn it on again in February. So we still have this problem with this short- term decision making and not really addressing the long-term problems.

That's what Warren Buffett, what so many business leaders are so worried about. Today, talking to so many business leaders, no one is saying congratulations. They're saying, OK, kick the can, hopefully kick the can, and then we're going to be here in February.

TAPPER: And yet a lot of business leaders are also Republicans and support a lot of House Republicans. And a lot of them are very concerned about what House Republicans are worried about, which is the debt, the national debt, which is almost $17 trillion.

ROMANS: But a lot of these business leaders know that you don't solve that at the credit card, you solve that at the spending and the front end. They say that we need a budget and we need priorities in this country.

If you look at half a dozen debt commissions over how many of the past 15 years, all of this work has been done. We know that there are tough choices to be made, but in Washington, people aren't making tough choices, right? They're just thinking from election to election or shutdown to shutdown.

TAPPER: You don't think forming a blue ribbon commission is a tough choice?

ROMANS: Not when it's not binding, not when you don't have to do anything about it. I mean --

TAPPER: Picking that shade of blue for the ribbon, that's going to be tough.

ROMANS: This is true. Look, all of the work has been done. Now people have to give something up and figure out how to really fix these problems.

TAPPER: Well, we are here in Washington -- not me, but they are kicking the can down the road again, because the government will open until January, the debt ceiling will be extended until February.

And I'm wondering if that uncertainty, the fact that it's baked in. We know where we could have another crisis like this again, in a few months; we won't be outside of it, of course, when we do the show.


TAPPER: Is Wall Street worried about that?

ROMANS: They're worried about it. It is baked in and they know that the Federal Reserve is really the only functioning body in Washington. The Federal Reserve isn't pumping $85 billion a month into the system. So you've seen stocks go up.

Even as these budget woes have been going on for more than two years now, stocks have gone up, we have had job creation, but not as much as we should have.

So the Fed has been really propping up the economy. But Ben Bernanke, Janet Yellen, who is the nominee to succeed him, they've all said, they can't going on like this forever. We can't keep propping up -- the Fed can't keep propping up the economy, because Washington can't get its act together, can't have sane fiscal policy and really focus on job creation instead of these squabbles.

TAPPER: The two sticking points when it comes to a long-term debt deal are Republicans want major reform to safety net programs, entitlement programs, if you will. And Democrats want to raise taxes.

Is Wall Street willing to go along with a morphing of the two in order to have more stability, because my impression is Wall Street is very anti-tax?

ROMANS: Look, Wall Street wants comprehensive tax reform. Wall Street wants lower corporate taxes. That might mean taking away some loopholes from some industries. Wall Street wants to know what the rules of the road are, right? Now, and let's remember, too, only have of Americans are invested in stocks. So for right now, most people don't care at all about Wall Street.

They only care about the fact that they've gone to a payday lender because they just didn't get their federal check or they're very concerned about, you know, a contract or a license they need and the federal government is shut down. So this has hurt. It really has hurt real families and real people right now. And I'm not sure these people get that.

I think they think they averted something here, but they didn't avert anything. They already have hurt the economy, and these squabbles the last couple of years, like Mark Zandi from Moody's analytics and a couple of other places have said at least 800,000 to a million jobs have been lost over the past three years because of the uncertainty in the budget squabbles here.

TAPPER: Let the record reflect, you're pointing to members of Congress, not to these young men and women --

ROMANS: Not to you.

TAPPER: They're good, they're sweet. Christine Romans, thank you so much. We appreciate and it congratulations on the new gig.

ROMANS: Thanks.

TAPPER: Coming up next on THE LEAD, welfare checks stopped in one state and the government shutdown is blamed. Are state officials playing politics with vulnerable kids or is it the shutdown?

Plus, a story we've heard before, A night in underage drinking ends in accusations of rape. A victim shunned for speaking up and charges dropped against two football charges. But now nearly two years later, could the case get a second look?


TAPPER: Welcome back to THE LEAD, live from Capitol Hill. Now, we knew the shutdown was bad news, but the numbers paint a picture of just how bad. Moments ago, Standard and Poors released a report that the stalemate in Washington has taken $24 billion, yes, billion, with a "b," out of the economy.

The Senate deal is coming just in time for thousands of children in one state who cut off welfare checks, the move being blamed on the shutdown. Our Rene Marsh is looking into that part of the story for us -- Rene.

RENE MARSH, CNN CORRESPONDENT: Well, Jake, as you know, a deal may be in the works, but for thousands of people in the state of North Carolina, this has really been a nail by biting, tense wait. It turns out that North Carolina is the only state in the nation that has chosen to suspend some welfare benefits because of the shutdown.


MARSH (voice-over): In North Carolina, more than 20,000 needy families received their last welfare check this month. Governor Pat Macquarie, a Republican, temporarily halted the state's Work First Program, which provides short-term assistance to low-income families, concern from people who call the program a lifeline, like James Murphy's sister.

JAMES MURPHY, NORTH CAROLINA RESIDENT: She don't know how she's going to be able to take care of her baby, the third one.

MARSH: The checks are about $215 per month for each family. Other states are using their own money to plug the gap after the Obama administration sent this letter, saying states could qualify for federal reimbursement post shutdown. But North Carolina doesn't trust that the government will repay them.

REP. DAVID PRICE (D), NORTH CAROLINA: Why is North Carolina the only one of all these states that is victimizing its most vulnerable citizens in this way? It is not acceptable.

MARSH: North Carolina's Democratic Congressman, David Price, says it could be politics.

PRICE: The state has found $75,000, $80,000 to keep the Blue Ridge Parkway open, and that's a good thing, but it does raise the question, why would we be the only state out of 50 that can't find the money for these families with these acute needs?

MARSH: The North Carolina Budget and Tax Center, an advocacy group for low-income families, agrees.

ALEXANDRA SIROTA, NORTH CAROLINA BUDGET AND TAX CENTER: We have a rainy day fund that has more than $600 million in it. This is certainly a rainy day for families in North Carolina. There's no reason that state policymakers can't tap into those dollars to provide stopgap support to families today.


MARSH: All right, well, it is worth noting that we did reach out to the governor of North Carolina for an explanation as to why he found it was necessary to suspend new applications for some of these welfare benefits. We have yet to hear back from him. But the big question is, so what happens when this shutdown is over?

We asked that question to the state, and they said that if the shutdown and a deal does come through tonight, then they should start processing those new applications. Emphasis on the "should," because they still don't know when that federal money will be available to them, once again.

TAPPER: And it still hasn't passed the House. Rene Marsh, thank you so much.

Coming up next, whether you're a fan of Grunge or Gangster Rap, music lovers take note, the newest Rock and Roll Hall of Fame nominees are out and we'll tell who made the list that's coming up next.


TAPPER: Welcome back to THE LEAD, live from Capitol Hill, where we are waiting on a vote that could lead to the end of this long government shutdown and the debt crisis, debt ceiling crisis, I should say. The debt crisis continues.

Some other headlines now, Missouri's lieutenant governor is urging the state's attorney general to revisit a controversial rape case that was dropped last year. Just like in Steubenville, Ohio, the case involves underage drinking, high school football and well connected families, has brought out the ugly side of some in the community.

Felony charges were dropped last year against two 17-year-old football players from Maryville High School. One who was accused of raping a 14-year-old freshman cheerleader named Daisy Coleman. The other accused of recording the assault. The family claims they were forced to move out of town last year because of backlash from a community that blamed the girl.

Her mother says Daisy tried to commit suicide twice. Their former home also mysteriously burned down six months ago. The hacking group "Anonymous" has also demanded a new investigation and vowed justice for Daisy and her family.

A much lighter note now, in our Pop Culture Lead. Here we are now, getting nostalgic. They were the Gods of Grunge and now prepare yourselves, Gen Xers. Nirvana is among 16 new nominees to the 2014 Rock 'N' Roll Hall Of Fame. But if you're more into spandex and face paint than the whole flannel thing, the Glam Rockers Kiss, they're also on the list this year. Good times.

As are LL Cool J, Pat Stevens, Peter Gabriel, and NWA, all nominees release their first single or album at least 25 years ago, hard to believe, a fact that's causing me to have a full-on existential crisis right now. Time flies.

Make sure to follow me on Twitter @jaketapper and also @theleadcnn. I'll be back at 11:00 p.m. Eastern tonight, 8 p.m. Pacific for a live CNN special, "Shutdown Showdown." I now turn you over to Wolf Blitzer in "THE SITUATION ROOM."