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John Kerry Talks Middle East Peace; Obamacare to Cost Millions of Jobs; Is Sochi Ready for Olympics; Fisherman Lost at Sea Returns

Aired February 5, 2014 - 13:30   ET

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


(COMMERCIAL BREAK)

WOLF BLITZER: Tomorrow, the secretary of state, John Kerry, marks one year as the nation's top diplomat. Today, he sat down for an exclusive interview with our own Jake Tapper. And Kerry spoke about the challenges he faces from the Middle East peace process, to Syria, to Iran, and a whole lot more.

Jake is here with a little preview.

I know the interview is going to air on "The Lead" later today but did make some news on this Iran deal, right?

JAKE TAPPER, CNN HOST, THE LEAD: He made news on a number of issues. We talked about Syria, Israel, about whether or not he would ever run for president again. But, yes, talking about this Iranian deal, I asked him a rather tough question, I think, about how the Iranians seem to be presenting the deal to the world.

(BEGIN VIDEO CLIP)

TAPPER: The Iranians are telling their public that this deal is not that big a deal, what they have agreed to do, that they could undo it within a day. Rouhani went to Davos and basically said we're open for business in Iran. The French, the Turks, they have been sending, not trade missions, but they have almost been sending trade missions, looking to do more business. Have we been played?

JOHN KERRY, SECRETARY OF STATE: Not in the least. Not even by a close margin. In fact, I -- look, I think the Iranians naturally are going to go home and say what you've just said.

TAPPER: Sure, but to the world and the Turks and the French?

KERRY: No, Iran is not open for business. And Iran knows it's not open for business. Nobody should doubt for an instant that the United States has prepared to enforce the sanctions that exist. And all of our allies are in agreement that those sanctions are staying in place until or unless there is a deal.

(END VIDEO CLIP)

TAPPER: And, Wolf, the secretary of state went on to say that when it came to those French businessmen going to Iran to possibly explore business opportunities, they need to know that sanctions will impact them, and they have been put on notice, he said, of those Frenchmen.

BLITZER: But they will get, at least over the next six months, assuming the deal is fully implemented, $4, $5, $6 billion and an easing of sanctions, the Iranians.

TAPPER: Absolutely, there will be an easing of sanctions. Secretary Kerry said that's a necessary part of the deal.

Of course, there are a lot of skeptics of this deal, not just Republicans in Congress, but many Democrats, including the Democrat who succeeded Secretary of State John Kerry, on the Senate Foreign Relations Committee. Very skeptical, wanting to impose more sanctions. Kerry said, you cannot -- we cannot go back on our deal. We have made a deal with the Iranians. We at least have to give it a chance.

BLITZER: Even though the sanctions -- if Bob Menendez, the chairman of the Foreign Relations Committee, or Chuck Schumer, the Senator from New York, had their way, they would pass the legislation now, but not implement it for six months. Assuming that the deal collapses, they would have that ready to go.

TAPPER: Kerry said it's absolutely not productive to what they're trying to achieve.

BLITZER: And there was good exchange you had with him on some of the recent exchange of words that he had with the prime minister of Israel, Benjamin Netanyahu, on the peace process.

TAPPER: You want me to do the whole interview right now?

BLITZER: Just give us the headline?

TAPPER: Well, the headline, I had said something about if the peace process does not continue, if the status quo remains and no peace between the Israelis and Palestinians, then those who are pushing for punishment towards Israel, including those who are pushing for the boycott movement, will likely succeed. Words to that effect.

(CROSSTALK)

BLITZER: But isn't that a fact?

TAPPER: I think that is correct.

BLITZER: Yeah.

TAPPER: He says he was not backing the boycott, and, in fact, he's against all boycotts, especially this -- the boycott against Israel. But many politicians in Israel, especially the more conservative types, suggested that Kerry, by even discussing this, was bringing it credibility, was giving a mega phone to an anti-Semitic boycott. Kerry's response, we will err on "The Lead."

(CROSSTALK)

TAPPER: It got even more forceful than that.

BLITZER: That's why I asked you about it.

TAPPER: Well, tease it up at 4:00 eastern.

BLITZER: The whole interview.

TAPPER: The entire interview.

BLITZER: We'll be looking for it at 4:00 p.m. eastern.

TAPPER: Thank you, Wolf.

BLITZER: 4:00 p.m. eastern.

TAPPER: Eastern time, 1:00 p.m. pacific, if you happen to live in California.

BLITZER: We'll watch. Thanks very much.

TAPPER: Thanks.

BLITZER: Jake Tapper with another good interview today.

Damage control for the White House. A new report on the effects of Obamacare has Republicans licking their chops. Up next, a little more detail on what the report really means. We'll talk about the possible effect on the midterms. Stay with us.

(COMMERCIAL BREAK)

<11:40:00>

BLITZER: New report from the Congressional Budget Office has caused a rumbling on Capitol Hill. The work force will lose the equivalent of 2.3 million full-time jobs by the year 2021, because of the Affordable Care Act. Today, in a hearing on Capitol Hill, the head of the Congressional Budget Office had a chance to explain those numbers.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN, (R-WI), HOUSE BUDGET COMMITTEE CHAIRMAN: Who are the people typically in this category? What kind of worker, from an income scale side, are being affected by this?

DOUGLAS ELMENDORF, DIRECTOR, CONGRESSIONAL BUDGET OFFICE: So the effect is principally on the labor supply of lower-wage workers. And the reason is that what the Affordable Care Act does is to provide subsidies, focused on lower and lower and middle-income people to buy health insurance, by providing heavily subsidized health insurance to people with very low income and withdrawing those subsidies as income rises. The act creates a disincentive for people to work relative to what would have been the case in the absence of that act. These subsidies, of course, make those lower-income people better off.

(CROSSTALK) RYAN: I understand better off in the context of health care. But better off in inducing a person not to work who is on the low income scale, not to get on the ladder of life to begin working, getting the dignity of work, getting more opportunities, rising their income, joining the middle class. This means fewer people will do that. That's why I'm troubled by this.

REP. BILL PASCRELL, (D), NEW JERSEY: So what you're saying is that because of the security of Obamacare, that it provides, a 60-year-old -- let's take that as an example -- might decide to retire early.

ELMENDORF: Yes.

PASCRELL: And open up a job for someone who is unemployed today. Is that correct?

ELMENDORF: Yes, that's right, Congressman.

(END VIDEO CLIP)

BLITZER: Let's discuss what's going on with our senior political analyst, Ron Brownstein.

First of all, Ron, the report, the CBO report, nonpartisan, came out, highly respected. Is this really bad news for the White House and Democrats?

RON BROWNSTEIN, CNN SENIOR POLITICAL ANALYST: It is a complex nuanced analysis of a subject that is super-charged and doesn't lend itself to complexity and nuance. What they said is very important to parse. They did not say that the Affordable Care Act will reduce the demand for labor. It will not reduce the willingness of business to hire workers. What they said was that, over time, it would reduce the supply of labor. That fewer people will choose to work, either for early retirement or for staying out of the work force at a rate of 2.5 million people by the end of a decade. Elsewhere, they say the law might reduce unemployment by freeing up resources among people receiving subsidies now spending on health care to spend on other things. So it was a very complex analysis but one that by and large I think -- my feeling has been, and we have talked about this before, that public opinion is not likely to change on this law any time soon because the administration simply can't get clear water. Whatever good news they have -- sign-ups are increasing -- is often offset by something on the other side of the ledger. And this is at least a complex analysis that creates doubts.

BLITZER: And it's certainly going to be a huge issue in this midterm election cycle.

BROWNSTEIN: And the problem it's got, Wolf --

(CROSSTALK)

BLITZER: Who is they?

BROWNSTEIN: The administration and Democrats in general. Is that the pivot of the midterm election are states where the Affordable Care Act is likely to be especially unpopular. The most important thing in this midterm election is whether Democrats can hold seven Senate seats they now hold in states that voted for Romney in 2012. Those tend to be older, blue-collar, whiter states, like Arkansas, West Virginia, South Dakota, Montana, Alaska, where the law is especially unpopular. Those are constituencies who are the most skeptical of it. So it is going to be difficult in the midterm. Whether that translates into a problem in 2016 is something different. But for 2014, almost certainly a problem.

BLITZER: When you hear Democratic leaders in Congress, whether Nancy Pelosi or others, say you know what, you can make this -- Obamacare, Affordable Care Act -- a positive winning issue in your re-election bid, do you believe them?

BROWNSTEIN: I think it's hard in the near-term. The game for the administration really is building up institutional support for the law. As I said, I think it's hard to change public opinion. You know, most voters -- there's been at least a plurality that viewed this as a negative and positive for the country, really almost all the way through. That hasn't changed much, only a third or 35 percent of Americans say it will benefit them and their family.

What they can do over time is build a constituency for the law in the millions of people they are adding to the insurance roles, as well as the medical industry that believes it benefits by having more people covered rather than facing uncompensated care. If they can do that, they can fortify the law and reduce the odds that even a Republican president and Congress can reduce in 2017. But I think the odds are that, at least in this midterm election, it will be a negative again for many Democrats.

BLITZER: Ron Brownstein, good explanation, as usual. Thank you.

BROWNSTEIN: Thank you.

BLITZER: Countdown to the Winter Games, and it's looking like there is really some chaos inside the ring of steel as workers rush to finish parks and hotels before the grand opening.

(COMMERCIAL BREAK)

BLITZER: Only two days away from the Olympic opening ceremonies. In a new CNN poll, the majority of Americans expect a terrorist attack in Sochi. 57 percent, in fact, say it's likely. 51 percent, by the way, expected an attack in Atlanta in 1996 in a poll we did then. The location in Sochi was hand-picked by the Russian president, Vladimir Putin. It's his favorite vacation spot. But in our poll, the American people don't really like Putin. He's got just a 20 percent favorable rating, though his country, Russia, fares a little better with 41 percent.

It's torch day in Sochi. The torch arrived after 123 days and at least 35,000 miles. The big news wasn't the flame. Instead, it was the flame-haired American, Shaun White. He announced he's pulling out of one of his two events. It's called the slope-style snowboarding it's called the slope-style snowboarding effect. He was one of the athletes injured on the course.

Our senior correspondent, Ivan Watson, is in Sochi covering all of this.

Ivan, some say the slope-style course is too dangerous. This would be another black eye presumably for the games to go along with the alleged poisoning of stray dogs, a lot of unfinished hotel rooms and a lack of snow. Here's the question. Is the city really ready for these games with only two days until the opening ceremonies?

IVAN WATSON, CNN SENIOR CORRESPONDENT: Certainly the International Olympic Committee is standing by Sochi, standing by Russia and the Russian Olympic organizing committee saying yeah, things are good. Yes, there has been a lot of attention in the last 24 hours because of the journalists coming in and learning that the rooms are not ready or furnished or water is not running. The IOC insists this is just 3 percent of the tens of thousands of hotel rooms currently in Sochi. The fact is, Wolf, that everything behind me, this entire Olympic Park, all of the dormitories and buildings and stadiums, none of this existed seven years ago when Russia won the right to host the Olympic Games. It's all built in this mad rush of construction that has this enormous price tag of about $50 billion, the most expensive Olympics yet. It's very clear that the Russians still have not worked the kinks out of some of this infrastructure at the very least. We have seen some of it working quite well. They insist the venues are working well. We will have to see the test. What happens when the tens of thousands of tourists come and the families of athletes if their water is running and hotel rooms are not finished in time. Then things will get bad.

BLITZER: What about the athletes' accommodations. Forget about the media and the fans and spectators. What about the athletes?

WATSON: From the reaction we have seen so far, I think the Russian Olympic Committee, the various hotels, they seem to value the athlete far more than the journalists. Do you blame them? We heard no complaints from the athletes. In fact, we heard the opposite, that some of them were impressed by the Olympic cities and the villages. No complaints yet from any of them.

Though there is a concern about the slope-style snowboarding course after a Norwegian snowboarder broke his collarbone the IOC had to put a statement out saying that has nothing to do with the course's safety. Shaun White, the U.S. team's superstar snowboarder, conceded he had concerns about that slope-style snowboarding course after he agreed to pull out of it, as he said, to focus on winning a third gold medal in the regular half-pipe snowboarding event -- Wolf?

BLITZER: Ivan Watson in Sochi for us. Thanks, Ivan. Thanks very much.

The star of the Olympic delegation won't be going to Sochi. Billy Jean King will miss the games because of the failing health of her mother. In a statement, she thanked President Obama for picking her to lead the delegation. No current members of the Obama administration will be attending the games, although the former secretary of Homeland Security will, Janet Napolitano.

Later in "The Situation Room," I will sit down live with Mitt Romney and talk about security at the Sochi Olympic Games. He was in charge of the Winter Games in Salt Lake City. I will ask him about his plans in 2016. Is it possible he can try a third time to be president of the United States? The interview at 5:00 p.m. eastern in "The Situation Room."

This fisherman said he was lot of at sea for a year. But does his story hold water? A closer look when we come back.

(COMMERCIAL BREAK)

BLITZER: Here's Jeanne Moos with an amazing survival story, that is, if it's true.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN NATIONAL CORRESPONDENT (voice-over): After 13 months adrift without a water supply, the apparent castaway was back on land holding a Coke, and he spoke through a Spanish translator as if talking to aliens, using gesture after gesture to describe dreaming food and contemplating suicide because he was so hungry. What were the foods he craved most?

JOSE SALVADOR ALVARENGA, CASTAWAY: Tortilla. Huevos. Pollo. Agua.

MOOS: He seemed mentally shaken and exhausted. When a light started to fall, he was quick to react.

No one asked whether he talked to anything the way Tom Hanks talked to his volleyball, Wilson.

(BEGIN VIDEO CLIP)

TOM HANKS, ACTOR: We may just make it. Did that thought ever cross your brain?

(END VIDEO CLIP)

(SHOUTING)

MOOS: Jose Salvador left Mexico on a one-day fishing trip with a teenage fisherman. After their boat was blown off course, he said his companion refused to continue eating raw food and eventually died. Throughout what would be a 5,700 mile journey, he survived on fish, birds and turtles.

UNIDENTIFIED MALE: How did he catch a turtle?

MOOS: It wasn't like a flying fish dropping from the sky like in the "Life of Pi," but they came banging against the boat.

SALVADOR: (SPEAKING FOREIGN LANGUAGE)

MOOS: That all he had to do was grab them. Skeptics abound, saying that's one chubby castaway, and looks like he has been scoffing turtle burgers and chips.

(on camera): Doctors say he seems to have liver problems and edema, which could make him bloated.

(voice-over): But we really don't know if the story was true.

The hardest part, he said, was during periods without rain and he had to drink his own bodily fluids.

SALVADOR: (SPEAKING FOREIGN LANGUAGE)

MOOS: He finally washed up on a coral island among the Marshall Islands. He was stark naked when he yelled at two residents.

BBC quotes witnesses saying the boat was covered in sea animals, with a dead turtle and fish remains inside.

During the interview, he kept touching his long hair, though it wasn't long until the immigration chief treated him to a haircut and a shave. All that hair, like a memory, cast away.

Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

BLITZER: That's it for me. Thanks for watching. I will be back at 5:00 eastern in "The Situation Room."

NEWSROOM continues right now with Brooke Baldwin.

BROOKE BALDWIN, CNN ANCHOR: Mr. Blitzer, thank you very much.

Great to be with you all on this Wednesday. I'm Brooke Baldwin.