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North Korea Launches another Missile; McCain's Vote Kills Obamacare Repeal; Scaramucci Unleashes against Priebus; Sessions Calls Comments Hurtful. Aired 12-12:30p ET

Aired July 28, 2017 - 12:00   ET



[12:00:10] ANNOUNCER: This is CNN breaking news.


A lot of breaking news here in Washington.

Obamacare repeal is dead and the White House is in turmoil. But, to those stories in a moment.

We begin with major breaking international news. The Pentagon now confirming to CNN, North Korea has launched yet another ballistic missile. It happened just over an hour ago. CNN's Pentagon correspondent Barbara Starr standing by live with the latest.

Barbara, what do we know?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, John, as you well know, it is often the case that world threats intervene on Washington politics. That may be what we're dealing with here today.

The Pentagon, at this hour, is trying to determine exactly what type of ballistic missile North Korea fired a short time ago off its eastern coast. The question at hand right now is, did North Korea fire another intercontinental ballistic missile east towards Japan? This is the big concern.

An intercontinental ballistic missile, the first one fired just a few weeks ago on July 4th. If they have done another one this soon, that is a major new security calculation facing the president. Of course, an ICBM, an intercontinental ballistic missile, is the type that could someday be capable of striking the U.S. with what North Korea wants, which is a nuclear warhead on top of that kind of missile.

To be clear, we don't know at this hour exactly what type of missile they fired. That is something that the Pentagon, South Korea, Japan, determined by looking at satellite imagery, the heat signature that they can determine through satellites and radars, how long the missile flew, how high it flew, how high did it go, where did it come down, the exact technical details of the trajectory that the missile flew. That will help them determine what kind of missile this was. But regardless, there is a good deal of concern that North Korea is

moving ahead with that long-range missile program. It was just recently that the U.S. intelligence community updated its own assessment by about two years, accelerating the time frame on which they thought North Korea might have an intercontinental ballistic missile in fact capable of hitting the U.S.

So we will find out in the next few hours hopefully what kind of missile. And then the White House will have to figure out what, if anything, they want to do about it, John.

KING: One of the many big challenges facing President Trump a little more than six months into his administration.

Barbara Starr with the breaking news.

Barbara, we'll get back to you as developments warrant throughout the hour. Just raise your hand when you have new information and we'll get back to you.

Now to the other breaking news here in Washington, the collapse of the Obamacare repeal efforts in the United States Senate. Watch the show is what John McCain told reporters as he walked into the Senate chamber.

And what a show it was. More moderate senators huddled with him to share their thoughts and their vote counts. Susan Collins and Lisa Murkowski's were firm nos. That left no room to spare. So the majority leader made his case for a McCain's yes vote to keep the Obamacare repeal process alive. The vice president tried. Then handed Senator McCain his cell phone so President Trump could made his final pitch. And, just before 2:00 a.m., show time. McCain walked to the well of the Senate, flipped his thumb down and voted no.

His vote the other day allowed this debate to begin. And his vote early this morning left a seven-year Republican Party promise in shambles. A stinging defeat for Republican congressional leaders and for a president who promised deal-making was his special gift, and who repeatedly said repealing Obamacare would be easy.

Here's Senate Minority Leader Chuck Schumer last hour praising Senator McCain.


SEN. CHUCK SCHUMER (D), MINORITY LEADER: The very same courage he showed as a naval aviator in Vietnam he showed last night, and has shown time and time again.


KING: So now what? Will they try again? Will they fix Obamacare? Will there be, as McCain hopes, some bipartisan health care conversation?

CNN's Phil Mattingly is still trying to sift through the ashes, live up on Capitol Hill. Phil, what is next?

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Yes, and there are a lot more questions than answers here. But here's one thing we have an answer to, Senate Republicans, as we've seen repeatedly over the course of the last couple weeks, are at this point incapable of getting 50 votes for any repeal or replace proposal. From the fullest to the most bare bones, they are incapable of doing this, which leaves a lot of credence to what Senator McConnell said on the floor last night after this vote failed. It's time to move on. And I think you he talked to a lot of rank and file Republicans who don't like the process. They don't like how this all worked out.

But they also recognize, John, they campaigned on this for seven years. This is a primary reason they hold majorities in the House and Senate, at least partially a reason why they currently control the White House and they haven't been able to figure it out.

Now, this morning, House Republicans met at a conference meeting that aides said was to discussion the next steps forward on health care. They were supposed to vote on appointing conferees by this afternoon. That was the assumption that the Senate would actually get this done.

[12:05:10] Instead, there's more of an airing of grievances, if you will. Speaker Paul Ryan basically saying at one point I'm told, we're the only functioning chamber as it currently stands in Congress.

Now, after the meeting, Speaker Ryan put out a statement and it said, quote, I'm disappointed and frustrated, but we should not give up. I encourage the Senate to continue working toward a real solution that keeps our promise. We have so much work still to do. At the top of that list is cutting taxes for middle-class families and fixing our broken tax code.

Now, he's telling the Senate not to give up, but he's also talking about the next big issue that everybody cares about, and the issue that both the administration and Republican leaders have been itching to get on to now for almost a couple of months. Conservatives made clear, they're still going to try and figure out a path forward on repeal. Very unlikely at this point. Moderates say, hey, let's have a bipartisan negotiation. And there is bipartisan agreement that at least short-term market stabilization in the individual market, some type of package for that is not only necessary but possible.

Here's the issue, John. I know you know this very well. The Senate floor is not a fast place. And if you look at what's stacked up next, you have the NBAA, you have nominations, you have the budget, you have spending bills, you have the debt ceiling and then you have tax reform. These are all things that take a lot of time. So the idea that even a bipartisan proposal would ever reach the floor, that conservatives would fight that tooth and nail, would allow that to happen. By all accounts, right now, it looks like they will have to move on from health care, at least when it comes to a big leadership push. Whether or not they can successfully kind of achieve their other major agenda items, you can't help but note that that is an open question at this moment based on what we've seen over the course of the last seven months.

KING: Remarkable day after. Phil Mattingly live on Capitol Hill.

Phil, thanks so much.

Let's bring the conversation in the room. With us to share their reporting and their insights, CNN's Sara Murray, "The Atlantic's" Molly Ball, Michael Shear of "The New York Times" and Karoun Demirjian of "The Washington Post."

Hard sometimes to step back and think about how stunning this is when you look back at seven years of Republican promises. Donald Trump said he was the dealmaker who was going to come to Washington. He said this particular one would be easy. Later said, who knew health care is complicated. We can talk about -- we'll talk about this throughout the hour.

But in this -- these hours after, how does the Republican Party put the pieces back together? This was their signature promise to the American people in 2010, 2012, 2014, 2016 and now it is ka-boom.

MICHAEL SHEAR, "THE NEW YORK TIMES": Think about what that promise really was, right? I mean as somebody who was -- I was there covering in 2009 and 2010 when they were debating this. It was never a clash of ideas where President Obama had one idea for health care and the Republicans had another kind of well-developed plan for how they thought it should go. It was always mostly an anti-Obama promise, right? We -- we're going to stop it because it's President Obama. And they had some vague idea that it was government controlled health care, but they never really put forward, over all those years, kind of alternative, this is what I want to do. And that's part of why they're struggling now.

KING: And it's also a very different Republican Party because of who came to office in those elections.

SHEAR: Right.

KING: You had two big Tea Party wins in 2010 and 2014, which you'd have to say Obamacare, running on repealing Obamacare was a big part of the Republican message. So what you have, especially in the House, is a much more conservative group who don't want to do what Senator McCain wants to do, who don't want to pass a bill like Senator Collins wants to do. So can they pick up the pieces here or are they done?

MOLLY BALL, "THE ATLANTIC": It's hard to see how they move forward. I man what Senator McCain called for was to start over from the beginning and do it right. It was to go through the committees, have hearings, have a public debate in front of the American people.

You know, there are various conservative policy wonks who did come up with alternative plans to Obamacare over the last seven years. They weren't involved in this process either.

KING: Right. Right. BALL: The administration didn't bring in someone like an Avik Roy (ph) and say, OK, you come in and bring us your ideas and we'll get some other ideas from the Heritage Foundation and we'll all have this big, intellectual discussion. It was much more, you know, to Michael's point, they've been promising just to get rid of this thing everybody hated. And even the bill that failed last night, that wasn't repeal and replace. They didn't even come close to an actual repeal. What they promised was to repeal Obamacare root and branch. Get rid of the whole thing. That was never even on the table.

KING: Right. And so the president weighs in to this last night and into this morning on Twitter. Three Republicans and 48 Democrats let the American people down. As I said from the beginning, let Obamacare implode, then deal. Watch. He went on to say, if Republicans are going to pass great future legislation in the Senate, they must immediately go to a 51-vote majority, not senseless 60. That's factually not in context. They didn't -- they only needed 51 to do most of what they were trying to do last night. Even though parts of health -- and then he corrected himself, even though parts of health care could pass at 51, some really good things need 60. So many great future bills and budgets need 60 votes.

So I -- these tweets, like throughout the process, is the president confusing things, as opposed to making things more clear.

The politics of this could be delicious. You know, it is a defeat for the president. It is more of a defeat for the Republican leadership, who for years before President Trump was even on the scene politically said they would do this.

[12:10:05] Can we try for one second to talk to the people out there watching in America? If you live in one of those counties that only has one insurer in your exchange because the others have pulled out over the past few years, if you're thinking about changing your job but you're afraid to do so because you don't know what the health care marketplace is going to look like in three to six months. Do we have any idea what comes next? Will the administration keep funding the Obamacare insurance subsidies? Will, as Senator McConnell promised, remember, he said if Republicans can't figure this out, we're going to have to work with Democrats on some fixes. Will they do that or will this become a political standoff where they just go off into their corners?

KAROUN DEMIRJIAN, "THE WASHINGTON POST": Well, I think this kind of goes back to what you were asking before of, can they pick up the pieces. First you have to identify what the pieces are. Are the pieces just the disparate parts of the GOP and trying to agree on something that they can have a party victory, which clearly they cannot now. And he's trying to see is there might be some -- and splintering off on other issues after this after this. I mean they were supposed to be on a defense bill right now. But Rand Paul surprised everybody said no. So there's not a lot of confidence in the leadership there right now in the GOP.

If the pieces are that you can actually start to work across the aisle, then the president's going to have to be willing to step off to the side and not keep stirring this pot so they can actually do that. That's a very, very tall order in this political environment to actually have Mitch McConnell and Chuck Schumer and shake hands so that they can afford to lose the more fringe parts of their parties and pull together a majority-proof middle.

: But I --

DEMIRJIAN: But that's sort of -- that's something that they can't do if the president continues to be involved in questioning the validity of this.

KING: Involved in the way he has been involved.


KING: Which has been inconsistent.


KING: Which has been inconsistent. Sometimes the president, in the same day, says, just repeal. Just -- then he says repeal and replace.

But what about from here forward? Could this be that Trumpian moment where he says, come down to Blair House, people, we're going to have a bipartisan health care summit and we're going to fix this? There are a lot of Trump voters out there who rely to a degree on Obamacare. They may not like it, but they -- if you're going to take it away, you better fix it.

SARA MURRAY, CNN WHITE HOUSE CORRESPONDENT: I would be surprised if after this failure the White House decides thy suddenly want to wrap their arms around this tighter and own it. But it think that their -- there was, you know, a real lesson in this. You cannot treat health care like it is a political football. It is too intimate to people's day-to-day lives, it's too intimate to their family histories, to their family stories.

And what we saw in the skinny repeal was a political document. There was not anyone in that room who thought that was good legislation, who thought that was good health care, who thought that was good for the people at home. And that is why it ultimately didn't make it through.

So, yes. I think you could get at a point later down the road where you see Democrats and Republicans at the same time. I don't think that's coming soon. But I also don't think if you're sitting in the White House you can sit there and say, we'll just watch insurers drop out of these markets, we'll watch premiums go up, we'll stop making payments and not own that.

Like, you are the president of the United States now. You answer to these people. You promised to fix this. You got your shot to do it your way with Republicans and you failed. So, yes, at some point they're going to have to do something.

KING: How much of a factor are the personal politics here? The president had his team go after Lisa Murkowski. He tweeted about her. Then they had his team call up to Alaska and essentially say, we will punish you. She stood firm. She voted no.

We know that John McCain and the president have a lousy relationship. The president didn't -- and McCain coming back for this debate did tweet, he's a hero. Thanks for coming back, John. We really need you. But we all know the history. He said way, way, back early in the campaign, I prefer those who don't get captured. And shot that McCain said shouldn't be about him, should be about all P.O.W.s.

How much did we learn from that about the personal relationships, which when you're at 52-48 in the Senate and you need every vote -- or just about every vote to get something done, that matters.

DEMIRJIAN: I think we learned about certain people. I think we learned that Lisa Murkowski, who, frankly, maybe should have known, you know, she has run as a write-in candidate and gotten back into the Senate.

KING: Right.

DEMIRJIAN: She has not just, you know, said, I'm going to vote no on the health care bill. She also may have said, you want your interior nominees? You're not going to have -- get them anytime soon.

KING: Right. She's not afraid of the president.


McCain, also, at this point, I mean he's always had this, you know, is he a maverick, is he a partisan, this question of the pulling back and forth. But at this point he really does have nothing to lose. I mean the guy just got diagnosed with brain cancer. So he can kind of take a moral position and not really have to suffer the blowback, which seems like a very callous way of putting it, but that is the case.

KING: Well, he gave -- McCain gave others cover. There were several other people who want -- who said, I prefer to vote no, but I'm afraid I'll get conservative backlash. Once they knew McCain was going to kill the thing, they were able to go over and not get -- not have the conservatives come in their face.

BALL: Yes, I mean, is -- the majority of Republicans are -- still are very afraid of the president. But I do think we saw a real breaking point this week. More with the sanctions bill, actually, than with the health care bill.

KING: Right.

BALL: But both of those were instances of Congress turning to the White House and saying, we don't owe you anything. And, you know, the president's consistent participation in the health care process was mostly standing on the sidelines throwing tomatoes over the fence.


BALL: And that was not particularly appreciated, right? Yes, he had them over for lunch. He made phone calls.

KING: Right.

BALL: But there wasn't a -- there wasn't a, you know, get down to brass tacks and talk about how to achieve actual substantive goals. And so I think we really saw a Congress turn on the president this week. I think it's only going to get worse. They are starting to gain the confidence to stand up to his threats because they realize they're pretty much empty.

[12:15:06] KING: And they think -- they think --

DEMIRJIAN: And I imagine that it's not all about policy.

KING: Right.

DEMIRJIAN: And some of this was the president going after Jeff Sessions, who's got friends in Congress. You don't mess with your friends. And then also the transgender troops. You had a lot of people who have a military backgrounds saying that's not OK.

KING: More on that as we go through the program more, and health care as well. We'll close this segment with this part. President Obama's spokesman put out this statement. The Affordable Care Act has made Americans stronger and healthier, but there will always be more work to do. President Obama has always said we should build on this law, just as members of both parties work together to improve Social Security Medicaid and Medicaid. President Obama still believes that it's possible for Congress to demonstrate the necessary bipartisanship and political coverage to keep delivering on the promise of affordable health insurance to every American.

President Obama weighing in from the sidelines. His law survives for now.

Ahead, more on the health care drama and the fall-out. But, next, a White House in crisis. A vulgar attack on two of the president's closest aides from the new hire in the president's inner circle.


[12:20:16] KING: Welcome back.

Anthony Scaramucci's title is White House communications director, which means Anthony Scaramucci speaks for the president. Here's what Scaramucci told "The New Yorker" about the White House chief of staff and, a warning first, this gets vulgar and offensive.

Reince Priebus, if you want to leak something, he'll be asked to resign shortly. That was the nice part. Reince is a bleeping paranoiac schizophrenic, a paranoiac, Scaramucci said. I don't think that's a word, paranoiac.

But he then turned his vulgar wrath on the White House chief strategist Steve Bannon. I won't read the first part of this out loud. No way. But there it is on the screen so you can understand the repulsive language used to describe a colleague by a top White House aide paid with your tax dollars. Of Bannon, Scaramucci then went on to say, I'm not trying to build my

brand off the bleeping strength of the president. Now, those words are vulgar. They're offensive. Maybe you like them. Maybe you don't.

Here's the most important part. This all became public hours and hours ago and the president of the United States has been silent. So we have to assume Anthony Scaramucci still speaks for the president, because that is what he was hired to do this week. And the president has done nothing to suggest he disagrees here.

The word "chaos" does nothing to convey the mood inside the Trump White House, which this week seems to make "Game of Thrones" seem like a tea party.

Sara Murray, you cover the building every day. You -- when you have somebody brought in who says he's doing this with the president's blessing, he says that as he does these interviews, as he says these things, that I'm doing this with the president's blessing. I'm assuming Steve Bannon and Reince Priebus are having a very interesting day at the office?

MURRAY: You know, I think that that's probably the right assessment. Look, we've seen the president doesn't like to do his own dirty work. We saw that with Jeff Sessions, where he's happy to just sort of, you know, shoot his mouth off on Twitter but he doesn't actually want to fire the guy, doesn't actually want to say he's safe (ph).

We're now seeing the same thing when it comes to Reince Priebus. Sarah Huckabee Sanders went out there. She did not say the president had confidence in Reince. She just said, if he wanted him gone, he would fire him.

So, you know, we have this White House were aides are constantly frustrated because they're sick of having to bat back at stories that they're about to get fired, but we have a president who's perfectly happy to have waring power centers and he thinks people work better, frankly, when their views are being challenged and when they don't know if their job is going to be safe day to day.

Now, it's no surprise that it might be difficult to find someone to replace Reince Priebus in that role. And that's one of the big things that's really held them back from pulling the trigger and just replacing the chief of staff outright. People aren't exactly competing to get this job in Washington. But this -- like this level of vulgarity, I think it's pretty stunning when you think about the job these people were hired to do and the office they're representing.

BALL: I think -- I don't find it totally shocking that people talk this way because people in politics do talk this way. They usually don't do so on the record and this was an on the record interview. But this is the way -- it's certainly the way Anthony Scaramucci talks and people have known him a long time. But I think to the point about Reince Priebus, he hasn't effectively been chief of staff for a while now.

He has been so busy trying to keep himself safe and get into the president's good graces. The president has never trusted him because he sees -- the RNC as having tried to get in his way from the beginning. And Reince is constantly been insecure about this position in the hierarchy. He's never had real sort of executive authority. He's never behaved like a chief of staff in that he runs the staff. And so these Scaramucci moments undercut him even more and ensure that he has no power over anybody, even if he stays.

KING: Do any of them realize this isn't about house Bannon, house Priebus, house Scaramucci? There's a country out there. Clearly a lot of people who voted for this president, who made him president, who would like to get a decision on what we're going to do about China trade, who would like to get Obamacare to the finish line, who would like to resolve some of these policies, they have legitimate policy debates within the White House. Can we get to those? But, silly me.

But we do know -- we do know -- I've talked to a number of people this morning and late last night, this reporting in "The New York Times" and elsewhere where people at this table have reporting that the president is openly talking about a new chief of staff. To Sara's point, they're having a hard time finding somebody.

Now, this happened a couple of months ago and it fell through and went back to what we have, whatever you call it, because they couldn't find anybody. Among those being considered, Gary Cohn, who's the president's top economic adviser right now. "The New York Times" says he wants a general and has talked about John Kelly, the homeland security secretary. I'm told David Urban, who's a former campaign adviser, a CNN contributor right now, his name has come up in the conversation. I'm also told, though, he's in line for a big ambassadorship, doesn't want to come inside, doesn't want any part of that.

Dina Powell, who's the deputy national security adviser, who works closely with Gary Cohn, who's very friendly with Jared Kushner, her name has come up as sort of a fallback candidate because I'm told the conservatives are pushing back against Gary Cohn very hard. They've looked at his positions. He's talked favorably about maybe raising carbon taxes. They think he would be in favor of legalizing the undocumented. They don't want him as chief of staff.

So, what does the president do? Does he let this just keep twisting in the wind?

[12:25:03] SHEAR: Well, it's possible that -- I mean we've all seen it before, that this could just sort of be another moment where we all think that this is going to happen and then it doesn't. It does feel like this is a little bit different.

But the problem is, as you pointed out, the language isn't really the problem. I mean Senator McCain has salty language. A lot of politicians we've all covered talk that way. We've certainly had that in sort of background conversations.

The problem is the actual dysfunction. This White House doesn't run the processes that have to run to get stuff done. Whether it's national security process to respond to North Korea, whether it's domestic -- a domestic, you know, step by step organizing your White House to get something done. And sort of the language that you've seen is just evidence that those things aren't happening because everybody's at war right now.

KING: And you -- Sara mentioned the attorney general hanging in the wind. He's in -- out of the country right now doing a trip out of the country, but he did do an interview with Tucker Carlson of Fox News. Listen to him here describe -- remember, the president has made clear, I have no confidence in my attorney general. He's gotten a lot of pushback from conservatives this week saying, don't you dare fire your attorney general. Listen to Jeff Sessions. And, remember, he was the first United States senator to endorse candidate Trump.


JEFF SESSIONS, ATTORNEY GENERAL: It's kind of hurtful, but the president of the United States is a strong leader. I serve at the pleasure of the president.


SESSIONS: If he's -- he wants to make a change, he can certainly do so. And I would be glad to yield in that circumstance. No doubt about it.


KING: Glad to yield in that circumstance. No doubt about it. He calls the president a strong leader. A lot of the blowback to the president this week, some of it open from other Republicans, is the president's actually a weak leader. If you don't have the courage to either fire people or just you shut up yourself and make sure Anthony Scaramucci shuts up and stop undermining,

I get your point about the language, but I'm sorry, I don't -- I don't think it would be tolerated at this company. I don't think -- do you think all the people at Apple talk that way about Tim Cook? Or that Tim Cook has his deputies talk to people about -- about senior people in this circle? Pick your big major corporation in America. Is that tolerated?

BALL: Well, and the other thing that -- the reason that he made the call was he was trying to find out the source of a leak.

KING: Right.

BALL: And so -- and it seems like what he's really been brought in to do is be the enforcer. Be the one who stops the leaking, which is really just people talking crap about their boss. And that seems to be what Trump is most preoccupied with. He sees that as the biggest problem is all of these people are talking about him behind his back.

DEMIRJIAN: And he wanted a street fighter and he's getting a street fighter in a way. I mean that -- he didn't like the Sean Spicer model of doing business. He did like Scaramucci as a person. He's come in. he's now doing this. And it -- you know, it might be shocking to everybody else, but the question is, if it's OK with the president and the other people were not OK with the president, it makes this a forgivable sin.

At the same time you know you've got Jeff Sessions, who's, you know, in a position where he's saying the thing that everybody says when they're in a situation where they don't want to provoke more of the president's ire because they're trying to keep their jobs and hold to -- (INAUDIBLE).

SHEAR: And the irony is, if I wasn't trying to minimize the language. It's horrible. In any other setting, big corporate setting, the person who uttered the language, the person who got caught uttering that kind of language would be the one on the way out. In this case, the person about whom the language that's described seems to be the person who's about to depart.

MURRAY: The only thing I would add is -- it's, you know, it's disheartening day in and day out to have to constantly go to people and say, is this person staying?

KING: Right.

MURRAY: Is this person going? What is your future hold? And, you know, that's because the president is constantly calling people and saying maybe today is the day I'm going to fire this person or fire that person or he's tweeting about how this person is weak and doing a terrible job. I can't imagine how demoralizing it must be if you are one of these cabinet secretaries, if you are one of these White House employee who has decided to take a job for a much lower pay than you would be making elsewhere, or if you're Jeff Sessions, give up a very safe Senate seat, to serve your country in a different way, and this is how your boss treats you. There was no apology from Anthony Scaramucci. There's been no apology from President Trump to Jeff Sessions. And I don't expect there will be on either front.

BALL: Yes, the Sessions thing put so many people on edge. I mean I think people expect him to treat his underlings this way, even if it's not very nice. But to go after Sessions, who has been so loyal, I think everybody now sees that no amount of loyalty is ever enough for Donald Trump.

DEMIRJIAN: There's a lot too at stake with the Sessions thing, just remember, because Sessions, you know, if you get rid of Sessions, can you start getting rid of other people who stand between you and Mueller? And then we're talking about the whole Russia probe and --

SHEAR: It's the heart of his agenda (ph).

DEMIRJIAN: Right. Exactly.

KING: All right, well, it's a great drama. A great drama. A government would be nice.

Up next, candidate Trump said governing would be so easy. He's finding out it's a little harder than he thought, as we've been discussing here, especially when parts of your own party turn against you. (COMMERCIAL BREAK)