Return to Transcripts main page
U.S. Senate Debates Tax Reform Bill; Net Neutrality and The Internet as We Know It; Saudi Arabia Says It Intercepted Missile Aimed at Riyadh; Europe, Asia Closely Watching U.S. Tax Overhaul; Mother Births Embryo Frozen For 24 Years. Aired 12-1a ET
Aired December 20, 2017 - 00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[00:00:14] JOHN VAUSE, CNN ANCHOR: This is CNN NEWSROOM live from Los Angeles.
Ahead this hour --
The U.S. moves closer to the biggest tax overhaul the country has seen in more than 30 years and an overwhelming number of Americans don't want it.
A missile attack aimed at the heart of Saudi's power by Houthi rebels in Yemen.
And net neutrality repeal -- is it really the end of the Internet as we know it?
Hello and welcome to our viewers all around the world. Great to have you with us.
I'm John Vause. NEWSROOM L.A. starts right now. >
The biggest rewrite of the U.S. tax code in a generation is very nearly a done deal. Senators are still debating but they're expected to begin the vote soon and approval is all but certain.
The House voted for the bill on near party lines Tuesday but Senate rules require a slightly different version. So the House will have to vote again on Wednesday.
Critics say the bill is a massive giveaway to corporations and the wealthy. Republicans argue it simplifies the tax code and will make American business more competitive overseas.
The tax reform bill is a major victory for Republicans as well as the President Donald Trump but Democrats see this as an opportunity as well once Americans actually read the fine print.
Here's Jim Acosta.
JIM ACOSTA, CNN CORRESPONDENT: It took nearly one year into the Trump administration but Republicans in Congress are on the verge of giving the President his first big legislative win, passing a tax reform package in the House mostly along party lines.
REP. PAUL RYAN (R-WI), SPEAKER OF THE HOUSE: This is a day I've been looking forward to for a long time.
ACOSTA: House Speaker Paul Ryan acknowledged the tax cut plan has yet to win over the public but blames others for that.
RYAN: When you have a sling fest, a mud fest on TV when pundits are slamming each other about this tax bill before it passes that's what's going to happen.
ACOSTA: A new CNN poll finds just one-third of Americans favor the tax plan with two-thirds saying it will benefit the wealthy instead of the middle class.
Most Americans also believe the President vast real estate empire will prosper too despite his denials.
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: This is going to cost me a fortune, this thing -- believe me.
ACOSTA: That was false, right?
SARAH HUCKABEE SANDERS, WHITE HOUSE PRESS SECRETARY: No, because on the personal side this actually could impact the President in a large way.
ACOSTA: Is he looking at how it would balance out corporate versus personal if he's going to come out ahead.
SANDERS: I'm not sure if he's done a side by side. But I know that there are a number of provisions that would negatively impact the President personally. And so we contend that those comments are still very consistent.
ACOSTA: Part of the problems with the President is that he's breaking promises he made on the campaign trail to make wealthy hedge fund managers pay more.
TRUMP: The hedge fund guys are getting away with murder. They're making a tremendous amount of money. They have to pay taxes.
ACOSTA: But a tax break tailor-made for the hedge fund set known as carried interest was saved. GOP leaders don't want to talk about that.
REP. KEVIN BRADY (R), TEXAS: Look, carried interest we can talk about that for the next hour if you'd like. But for most Americans they could care less about that.
ACOSTA: Heading into next year's midterm elections the White House isn't worried about the consequences. The President is betting the tax cuts will add to the gains on "Wall Street" touting this year's stock market performance on Twitter.
But as a candidate Mr. Trump sounded the alarm over what he saw as a market bubble.
TRUMP: Remember the word bubble. You heard it here first. I mean I don't want to sound rude but I hope if it explodes it's going to be now rather than two months into another administration.
ACOSTA: Democrats complain Republican wrote the tax under the cover of darkness accusing some in the GOP like Tennessee Senator Bob Corker of changing their votes after sweeteners were added to the package. Corker rejected that.
SENATOR BOB CORKER (R), TENNESSEE: I know that I'm being maligned over totally malicious stuff that's totally been disproven. I know people are having a good time with this. But it's just malicious. I'm making this decision because I believe that it is best for the country -- period.
ACOSTA: As for the President he is defending another victory he frequently cites -- his decision to tap Neil Gorsuch to the Supreme Court. Mr. Trump is slamming reports that he wanted to rescinded his selection of Gorsuch after the judge criticized the President calling the story fake news. Adding he never even wavered.
But there is one bit of fake news the President may welcome, as in the artificial version of Mr. Trump added to Disney's hall of presidents although this robot appears to be all talk and no tweets.
As to whether the President is benefitting from these tax cuts, Mr. Trump could settle the issue once and for all and release his tax returns. White House press secretary Sarah Sanders explained that the President won't do that while he's under audit. But there's nothing preventing him from releasing those tax returns anyway.
Jim Acosta, CNN -- the White House.
[00:05:01] VAUSE: Joining us here now in Los Angeles, CNN's political commentators, Democratic strategist Dave Jacobson and Republican consultant John Thomas; also with us political analyst Peter Matthews.
Thank you all. Welcome to the new configuration. I hope it wasn't too off-putting. Ok.
You know, it's not easy for a tax cut to be unpopular. But this one is. According to the Web site 538, the November average approval for the Trump tax cut was 32 percent.
Go back to 1993 -- a tax increase by President Bill Clinton was more popular at the time. So John to you -- I mean it could be true that Paul Ryan says it's all this negative coverage about the plan, all this bad coverage that it's getting about just, you know, how it will impact the middle class and you know, the working poor.
Or maybe it's not the coverage. Maybe it's the fact that it's a bad plan. JOHN THOMAS, CNN POLITICAL COMMENTATOR: I think there's two things.
Number one, I give credit to the Democrats. They got the jump on the Republicans at framing this issue that it's for the millionaires and the billionaires, not the 80-some percent of Americans who are going to see up to a $2,100 a year tax cut. That narrative was lost in the discussion.
Also the challenge is the messenger. Donald Trump's approvals are low and it's the President who sells these things. So if he's not a popular figure saying believe me, trust me this is a good package, it's hard to sell it.
So Republicans -- what we're betting on and I think this is a great bet for the midterm is the proof is in the pudding. If Middle America does in fact get a tax cut and see more jobs and the economy continues to grow that's a win for us.
VAUSE: Dave -- so the problem about, you know, selling the tax cut was a problem that an average household gets -- what -- $900 a year on average and someone who earns more than a million gets closer to $70,000 a year. Even as a percentage that's 3 percent for someone over a million dollars bump in their pay or whatever average household's 1.6 percent.
DAVE JACOBSON, CNN POLITICAL COMMENTATOR: Here's the third problem.
JACOBSON: The Republicans can't guarantee that every middle class family actually gets a tax cut -- like they can't guarantee that. This actually raises taxes on millions of working class families --
JACOBSON: -- in California and New Jersey and New York.
THOMAS: It puts a spotlight on states that have outrageous tax structure problem.
JACOBSON: Here's the problem.
THOMAS: The federal government is no longer going to subsidize out of control states like California.
JACOBSON: This bill is the embodiment of why we have a rigged economy. It gives massive tax breaks to millionaires and billionaires -
THOMAS: They're the people who pay taxes and earn a lot of money.
JACOBSON: -- and Wall Street corporations. Precisely the folks that Donald Trump campaigned on to sort of crack down --
THOMAS: But Dave -- 80 percent of Americans get a tax break. Is that ok? 80 percent.
JACOBSON: Look, it actually gives tax breaks to millionaires and billionaires. And it doesn't --
JACOBSON: -- for every middle class family. And that's why Republicans lost the message war.
PETER MATTHEWS, POLITICAL ANALYST: Put this on a different plane. This is the vision -- competing vision of Reaganomics versus supply side economics versus Keynesian economics.
Reaganomics was supply side so that if you cut tax on the wealthy, they will invest the money and it will grow the economy. But the problem is the wealthy people quite often invest in stock market or in overseas enterprises getting more profits.
They don't create jobs here. It's been proven in the past -- Reaganomics. But then the Keynesian economics with President Roosevelt is to stimulate the economy by spending money and in fact giving working people more a tax cut rather than the rich.
VAUSE: Because they spend it all --
MATTHEWS: Yes, they spend it all and they demand more.
VAUSE: And John -- you know, the problem is that -- we're talking here about a $900 a year tax break on average. Barack Obama when he was president cut payroll tax by about the same amount to stimulate the economy and that pretty much went unnoticed.
So I mean there is that danger that people could get this in their paychecks and not even feel it.
THOMAS: Well, I mean you look at South Dakota, for instance, I think the median house income is like $56,000 -- $57,000 a year. They're on average are paying I think $800 in taxes. They would not only -- they would be getting that if not more back.
I mean that's a lot to a middle class family. Perhaps not us on the coast where our costs are higher but everyday Americans I think they are going to feel it and the other thing they were hoping they're going to feel is the economy continues -- already humming along because hearing estimates from the New York Fed of 4 percent GDP -- that does trickle down the high --
MATTHEWS: The individual tax cuts expire in 2025.
MATTHEWS: The corporate ones remain permanently. That's the problem.
THOMAS: Well, that's right. But Paul Ryan said they've got a piece (ph) to make that permanent just like they made Bush tax cuts permanent. MATTHEWS: Well, we hope so, but you know, the people see that -- they wonder if that will happen.
THOMAS: And they would have made them permanent but the rule structure was that they couldn't do it until it was passed.
VAUSE: Dave -- you know, at least now Donald Trump and the Republicans, they've got something to boast about. It may not be the best tax bill in the world but they've got something to go back and talk about.
And even if the economy continues to improve it's not helping Donald Trump and his poll numbers. So it's kind of that, you know, give-and- take.
JACOBSON: Right. Because like at the end of the day the President is toxic any way you look at it. These tweets, the Russia investigation, the fact that he lies to the American people on a regular basis, you've got scandal after scandal. Donald Trump is his own worst enemy.
But the fact of the matter is going back to the tax bill Donald Trump said that he wasn't going to get a tax cut. Forbes magazine put out an estimate today that according to Donald Trump's taxes that were released in 2005, he's going to get an approximate $11 million tax cut. We're talking about $900 for an average middle class family across America excluding the coast.
[00:10:00] The fact of the matter is the President is going to get $11 million. Is he going to invest that in job creation? That's the big question.
VAUSE: What would you do with $11 million?
Ok. When the Obama administration passed health care along party lines, similar to this tax cut, Obamacare was fairly unpopular at the beginning. The Democrats argued it would gain support over time as people, you know, enjoy the benefits. Republicans are making a similar argument now for this tax plan.
(BEGIN VIDEO CLIP)
CHERIN: Mr. Speaker -- does the lack of Democratic support mean that this tax overhaul is vulnerable in the same way that the Affordable Care Act was vulnerable and ultimately changed today by --
RYAN: I think the comparison is a non-sequitur because the Affordable Care Act proved to be extremely unpopular. The Affordable Care Act proved to reduce health care choices, to raise premiums to make health care unaffordable.
This is going to do the opposite. This is going to grow the economy. It's going to increase paychecks. It's going to increase take home pay and that I believe is going to be very popular.
(END VIDEO CLIP) VAUSE: John -- Obamacare was very popular towards the end but it took years. So there's a danger here for the Republicans if they, you know, rely on this model that it could take a long time before people actually feel the benefits. And, you know, thank the Republicans.
THOMAS: It's possible. I believe this tax cut does take -- will affect Americans for the 2018 returns. So hopefully Americans will start to get those reductions to 80 percent of Americans as they go to the ballot box.
VAUSE: But Peter, overall, Trump's core supporters who are left worse off by this plan?
MATTHEWS: Many of them are actually. And if you look at history -- there were tax cuts, the same kind of tax cuts engineered (ph) back in the 1890s and 1920, again in 1981 under President Reagan and then in 2000 by Bush.
Every time they had these tax cuts it's always for the super wealthy. We are followed by a recession, a great depression -- a great recession and a great recession. So that was a problem. And a lot of people, even including the Trump supporters will say this just doesn't seem to be working out for us.
And I think that John may be optimistic that it will happen really soon for them. And when they see the tax cuts expiring, but the corporate tax cuts remain they're going to lose faith.
JACOBSON: Well, that's the big issue. It's Robin Hood in reverse, right.
JACOBSON: Right -- by 2027 we could increase taxes on hard-working citizens by $80 billion.
THOMAS: Paul Ryan, he says that they will make them permanent.
JACOBSON: Paul Ryan may not be speaker at that point.
VAUSE: -- like you get these perks at the beginning and then they slowly sort of trickle away to nothing at all, you know, years down the line.
VAUSE: What was interesting also is that last week lawmakers added a perk into this tax plan which was especially beneficial for anyone in real estate.
Anyway -- but there's also a lot of other people --
THOMAS: They're calling that the Corker --
VAUSE: The Corker kickback. But Corker isn't the only one. Listen to this.
(BEGIN VIDEO CLIP)
DAVID SIROTA, INTERNATIONAL BUSINESS TIMES: There's about 14 Republican Senators -- that's about a quarter of the senate Republican conference that have investments in LLCs and real estate related partnership investments in which they stand to make big money off of a provision inserted into the bill at the -- in the conference committee.
(END VIDEO CLIP)
VAUSE: And clearly John -- the President is no stranger to property development. How is that draining the swamp working out?
THOMAS: I mean there's no question this is not a perfect bill but like Obamacare Democrats argue it wasn't a perfect bill either. But we had to get something done.
THOMAS: Sometimes you have to horse trade. Look, it's like the carried interest loophole. Why in the world is that still in this bill. But somehow it is.
VAUSE: Ok. Dave -- given the administration has been caught up in a string of scandals, you know. Cabinet secretaries, you know, flying private jets all over the place. You know, we saw the Treasury secretary and his wife, you know, with a printed sheet of dollar bills there with their gloves looking like Bond villains. You know, there is a perception here within this administration that, you know, this isn't exactly draining the swamp.
JACOBSON: This is corrupt politics at its worst. At the end of the day, you've got Donald Trump who campaigned for the little guy, for middle America, for folks who feel disenfranchise.
And he's giving giveaways to wealthy Wall Street investors and corporations and millionaires and billionaires. And he's not really doing anything to create jobs and grapple with income inequality.
The rich are getting richer. The poor are getting poorer. Donald Trump's not doing anything for the poor, at least not through this tax bill.
VAUSE: And Peter, I mean Donald Trump could actually, you know, prove that he is (INAUDIBLE) of this plan if he released his tax returns.
MATTHEWS: If he released his tax returns -- exactly. But he wouldn't do it. There must be something that's holding him back from doing that. My question is what could that be?
THOMAS: There's no doubt that he's a successful business person. He has a lot property interests. Of course, he's going to make more money just like -- just like successful entrepreneurs should make more money. They pay more taxes. MATTHEWS: But John -- why not release them? Why not release the tax
returns. What's holding him from that?
THOMAS: Obviously it's counter to the broader narrative that he's trying to put forward about the 80 percent of Americans that do get relief.
VAUSE: Ok. On the same day that the President gets a very -- ok let's go to the Senate right now because they are wrapping up the vote. And this is an historic moment regardless of how you see it or your point of view.
[00:15:00] Ok. They've been casting a vote. This you know, is pretty much procedural now because we know that the bill should actually pass without any hurdles.
THOMAS: You know, what's remarkable about this?
THOMAS: It's that not a single Democrat is voting for this.
VAUSE: Why is that remarkable?
THOMAS: It's remarkable because Democrats are going all in on the fact that this will fail. If this succeeds, it is a clear path for the Republicans to succeed in the midterms in four years from now because there's not one Democrat. They were so against it.
Now, of course, if it fails, it's a good (INAUDIBLE)
VAUSE: Did they do a campaign on tax cuts.
This is very hard to campaign against a tax cut. Much easier to campaign on Donald Trump and you know, his Twitter wars and misogyny and you know, attacks on minorities.
JACOBSON: I don't think Democrats are against tax cuts for hard- working families or the poor. They're against tax cuts for Wall Street and for corporations and for big pharma and for big establishment interests -- the wealthiest individuals in this country.
And so what Democrats are going to do is they're going to shine a bright spotlight on how terrible this bill is. And look, Democrats don't even have to do that. At the end of the day the American people don't support this bill.
This is the most unpopular tax cut bill we've ever seen in modern America.
MATTHEWS: The numbers are staggering -- 66 percent don't support this bill. It's because of the fact that it benefits just a top few.
And again I go back to economic development. Is this going to help the economy or not. It can't help the economy especially the cuts in programs that actually would spread the money around and create more demand.
VAUSE: The other issue too -- this is a tax cut for -- this is a deficit-driven tax cut. And John -- you know, if you cast it right back to when President Obama was in office and you know, at a time when the economy was stalling, in deep trouble and that's when you traditionally have a stimulus package or a tax cut because that's the only spending really, you know, stimulus left to the economy.
Republicans opposed any kind of deficit spending. But now they're ok with this one. These guys who said, you know, the deficit is evil but now it's ok.
THOMAS: Well, because there wasn't -- they didn't see a growth solution out of the deficit spending. This is more akin to what happened with Reagan where he had a spending problem but the revenue to the government increased after the tax cuts. I think that's what they're looking at.
And then the next thing we have to tackle is spending.
VAUSE: And that's the thing too.
MATTHEWS: Wait, we're talking about the second Reagan tax cut. The first one, '81 actually did not increase revenue. That created a bigger deficit.
THOMAS: Right. We're talking about the second.
MATTHEWS: The second that tried to fix the first one.
THOMAS: Correct. And then we fought the Cold War, drove up our spending --
MATTHEWS: The debt went way up -- definitely.
VAUSE: But Dave -- you see what happened, you know, with the deficit. It goes all the way up, you know. It inflates the deficit and then we start hearing already from the Republicans that then means cuts to entitlements to cover the cost of the deficit.
So you have a situation where you get these corporations that are getting billions of dollars in tax breaks. People with million dollars or more will be having tens of thousands of dollars extra in their pocket. But I'm sorry, get Social Security and maybe pay for it.
JACOBSON: Precisely. This is the embodiment of, I think, extreme hypocrisy by Republicans. In 2010, they campaigned against Barack Obama. They campaigned against the deficit. And the fact of the matter is they're adding $1.5 trillion to the deficit.
And you're right, they want entitlement cuts at the end of the day. But those are going to impact middle class and poor families. And that's an issue the Democrats have to hold Republicans' feet to the fire.
THOMAS: I think the difference is, Dave, Republicans trust Americans and business owners, American working families to deploy their capital that we're giving back to them to create more --
MATTHEWS: They're not required - John. Why not require in the legislation that they should spend it on investment?
THOMAS: No, because that's exactly right. We trust that they'll spend it better --
MATTHEWS: But they haven't done that.
VAUSE: We have the (INAUDIBLE) there. The only problem was that when Gary Cohn the economic advisor was in a roomful of CEOs he said who's going to reinvest this money -- no one put up their hand. Because they were all going to use it as, you know, a share buyback scheme or, you know -- send it overseas.
Ok. Peter, Dave, and John -- thank you very much. Good to see you guys.
Ok. Well, Saudi Arabia says for the second time in two months, it has intercepted a Houthi missile fired at its capital Riyadh. Houthi rebels in Yemen say this is video of the launch and they say they were targeting the Saudi royal palace. No casualties have been reported.
But the launch shows the Yemen civil war is taking a disturbing new trend. Senior international correspondent Ben Wedeman reports now from Beirut.
[00:19:03] (COMMERCIAL BREAK)
VAUSE: Well, in what's already been a year of outrage in American politics, there seems to be rare agreement on net neutrality. In fact net neutrality is a good thing but the FCC voted to repeal the Internet regulations last week. And now many fear the days of fair and open Internet could be numbered.
But the fight is far from over with lawsuits about to be lodged and lawmakers on both sides of the aisle slamming the FCC's move. The issue could ultimately be decided in court or maybe even in Congress.
Well, for more on what's at stake here, Internet security analyst Hemu Nigam joins us now.
Ok. You think it's a whole lot of much ado about nothing. It's only with industry (ph), one of the big arguments for net neutrality is to prevent the big Internet providers from creating a fast lane for those who want to pay more, a slow for those who don't.
But there's also a counter argument which I think goes to your point -- all that excess data from companies like YouTube and Netflix, they aren't paying a dime extra for any of this. That's actually slowing the Internet down in a major way.
HEMU NIGAM, INTERNET SECURITY ANALYST: Well, there's also on top of all that, the reality is those two years is all that this rule actually existed at the FCC. So the question becomes the Internet started -- what, back in the 1980s, late 1980s --
NIGAM: What's happening in the last 20 something years --
VAUSE: Well, it became widely available. I would say, you know, in the last ten years or so. And the progression to mobile has been a big development.
And what it did that rule that was put in place in 2015 cemented the practice that had already been ongoing --
NIGAM: -- which is exactly the point that I'm making here is that the practice is already ongoing. So what's happening is the FCC was given a certain mandate -- hey make this be practiced in the -- you know.
And that is the unofficial law of the land so the real question becomes ok, if you take it away from the FCC, it says I'm not going to do this anymore. What was happening before? The FCC was standing ready with all eyes on the companies
The DOJ was standing ready for whether it's anti-trust, anti- competitive behavior or deceptive practices. There's all sort of list that these organizations in the government are ready to pounce on the private sector like Comcast or Verizon if they actually sway in any direction.
VAUSE: But net neutrality was codified because of a lawsuit that came out of North Carolina because, you know, a very small telephone company tried to do exactly this. They tried to block Vonage from having an app on their cellphones so people could use that app to make free Internet calls.
And that's where it all started from. The court ruled in favor of Vonage and then the FCC codified it. So there was an attempt to do what people are alleging, you know, it could have.
NIGAM: You know, the great point about that -- and I'm glad you brought that up -- is because at the time when you did that you actually didn't have to publicly disclose it.
NIGAM: What people are I think not realizing is that if any of these companies do it today you actually have to tell the consumer, hey we are going to charge differently here. You're going to pay more here, pay less here and all of a sudden every consumer advocate is going to come out like they've been doing right now.
VAUSE: Really? They're going to -- similar to those ads that --
NIGAM: They don't have to.
VAUSE: -- at the end.
NIGAM: Right. Well, I actually pause those commercials to read it. But I'm just --
Look, I think the problem with transparency, I think it's a fair one. The problem though where the transparency actually breaks down is when consumers don't have a choice.
And the FCC says what, about 50 percent of households in the United States do not have a choice of Internet providers. So the transparency is great it you could pack up your bat and ball and go to someone else.
VAUSE: But if you've only got one provider, you know, in your area --
NIGAM: That's actually a change in the definition. You know what's interesting is we are actually talking about all these finer point things that have been going on. But the larger picture is this and it's a very simple one.
[00:25:00] If you go back to what happened before, there were people watching for the consumer. And that's actually one of the greatest things about America -- there's so many advocates that sit in Washington D.C. that protect the consumer. And that includes the DOJ and the FCC and as well in many ways the FCC. And I think that's going to continue to happen.
What's going to happen -- I mean look at now -- we're what day six or something since this happened and we're still doing exactly the same.
VAUSE: It doesn't happen like -- it's like sending out a tweet. It is incremental.
NIGAM: Right. But what really needs to happen -- and this is I think where you're actually thinking about this -- what really needs to happen here is one very basic thing. And that is Congress get together, pass a law, make this policy the law of the land. And stop everybody from wasting money and wasting time on this because if you make it into a law the new FCC commissioner who comes in can't just change it like that.
VAUSE: Well, I mean --
VAUSE: -- because the change to this law is so dramatic that without any real basis to it that's I think one area they'll (INAUDIBLE) knock down. But I think the problem you have is that it happens so insidiously.
It happens incrementally. It doesn't happen overnight. And before you know it, you know, you are at the mercy of these Internet companies.
Have you ever spent, you know, hours on whole with Comcast or, you know, with AT&T or Univision, you know? I mean it is a nightmare already. I mean the customer service from these big companies is horrendous.
NIGAM: Yes. And the backlash they get from that is you talking about it in front of 20 million people.
VAUSE: It doesn't mean anything because they have a monopoly in the area.
NIGAM: Actually they don't because you have AT&T, you have Comcast, you have a bunch of companies. And yes, there is that, I guess some people call it an oligopoly. Is that a word? I remember --
VAUSE: It's an oligopoly in the sense that they're all as bad as each other.
NIGAM: Well, it depends on what perspective. At the end of the day, the good thing here is this. The consumer is being watched out for from many out there.
And the second is the companies actually realize given all the backlash that's happened they better be on guard here and do the right thing because if their moral compass shifts in the wrong direction there's plenty of people to say I told you so.
VAUSE: Look, I think when people find out that their free port in going away there will be riots in the streets.
VAUSE: Good to see you.
NIGAM: And that's for another night.
VAUSE: Ok. Thanks for coming in.
Ok. Saudi Arabia -- back to the story -- has said for a second time in three months it has intercepted a Houthi missile which was fired at the capital Riyadh.
Houthi rebels in Yemen released a video saying this was in fact the launch and the missile targeted the Saudi royal palace. No casualties have been reported.
But the launch shows the Yemen civil war is taking a disturbing new turn. Senior international correspondent Ben Wedeman, I hope, reports now from Beirut.
BEN WEDEMAN, CNN SENIOR INTERNATIONAL CORRESPONDENT: The Houthi rebels posted online the launch of the missile, a Burkan or a Volcano 2H -- a modified scud. It was aimed at the Saudi capital of Riyadh where an image of a plume of white smoke was captured moments after the missile was intercepted by a U.S. supplied Patriot anti-missile system.
The target, according to the Houthis was a meeting of the Saudi leadership at Al-Yamama Palace outside Riyadh. Saudi Arabia accuses Iran of supplying the Houthis with weapons, a charge Iran denies.
In a lengthy speech broadcast on a Houthi-run TV station the rebels' leader Abdul-Malik al-Houthi declared that Riyadh and Abu Dhabi -- capitals of the two largest members of the Saudi-led coalition are now in range.
He said after a thousand days had passed since the start of the Saudi- led offensive against the Houthis, a new phase had begun in the war. "They attacked our facilities and we will attack theirs," he said. "An eye for an eye, a tooth for a tooth."
In early November the Houthis fired a similar missile at the Riyadh International Airport. The level of violence has increased dramatically recently. According to the United Nations air strikes by the Saudi-led coalition have killed 115 civilians in the last 11 days.
More than eight million Yemenis are on the brink of famine while supplies of food, fuel and medicine are desperately low as a result of the Saudi embargo.
The United Nations is trying to act as a peacemaker but it appears no one is listening.
Ben Wedeman, CNN -- Beirut.
VAUSE: Well Asia and Europe closely watching the U.S. tax vote will tell you why they worry about the impact on global trade and investment in just a moment.
[00:29:41] (COMMERCIAL BREAK)
VAUSE: Welcome back, everybody, you're watching CNN NEWSROOM live from Los Angeles, I'm John Vause with the headlines this hour.
VAUSE: Markets in Europe and Asia have been closely watching the U.S. tax vote. So let's take a quick look at what's happening in the Asian region right now. There we can see it's all pretty much flat, the Nikkei, Hang Seng, Nikkei's in positive territory, Hong Kong down a touch. The Shanghai composite down by a quarter of a point and Australia pretty much is flat as well.
Alex Cherin is the senior vice president of Englanders, Knabe & Allen, (INAUDIBLE) I should say. He writes a weekly column on international trade and globe issues. Good to see you.
VAUSE: OK. So the view from Europe seems to be that this tax plan takes the U.S. from a high tax country down to a low tax country, at least from a business point of view. But it goes way beyond creating a level playing field here. It actually says that it gives a huge advantage to American exporters and that will penalize countries in Europe, especially countries like Germany.
ALEX CHERIN, SENIOR VICE PRESIDENT, ENGLANDER, KNABE & ALLEN: Well, that's certainly the perception. But what we will see in the coming days and coming months is whether Trump is the great negotiator as he has touted himself to be over the last few months and the years. So, look, three big takeaways from today's vote in the House overseas in Europe and Asia, and this is sort of the eyes of the global community.
Number one, the Trump administration, what happened with this bill has absolutely cemented the fact that lowering the corporate tax rate is going to be the cornerstone of the Trump administration.
We don't know whether that will pan out internationally or not but they certainly signaled that's going to be the cornerstone for years to come.
Number two is this hopeful optimism that this money that's parked overseas, American money, will somehow be repatriated back to the United States by giving a small tax penalty, 8-11 percent, sort of a get out of jail free card.
The third which you mentioned, which is the most contentious, is this incentive --
CHERIN: -- that this bill gives to American exports, again, to be determined.
VAUSE: Finance ministers from Germany, France, Britain, Spain and Italy, they've been in touch with the Trump administration directly, they've written a letter. This is part of it.
"It is important that the U.S. government's rights over domestic tax policy be exercised in a way that adheres with international obligations to which it has signed."
They go on to argue about all the unfair advantages for American companies. They also say that there could be violations here in a number of treaties as well as international laws.
So (INAUDIBLE), but do they have a case?
And what can they do?
CHERIN: They do. The irony, John, is this is the stuff that we complain all the time about when other countries do it, whether it's China or other countries, yet here we are. We've codified it in our legislation today.
What it essentially does is lower the tax rate on U.S. exports to about 13 percent. The hope is that that will obviously incentivize small businesses, agriculture and other markets in the U.S. to have a broader open market overseas.
The problem is that other countries, as you mentioned, are going to cry foul. To further complicate this is when it does come to a head, where do we go to resolve these disputes? Over the last few months, the Trump administration has tried to wean us off of our reliance on things like the World Trade Organization, NAFTA, the Trans-Pacific Partnership so it's a little hypocritical for us to criticize other countries, pull away from these multinational trade agreements that we have and then go ahead and do the same --
VAUSE: -- in the Trump administration in these institutional international organizations.
We're also not hearing a lot officially from China but there's been a lot of stuff in the state run media that doesn't get there by accident, there was a front page editorial in one of the business papers, warning that tax cuts in the U.S. and their fallout will pose a challenge to China's manufacturing and technological innovation, which China must cautiously brace for.
What would that impact be?
And not just in China because China's typical of so many countries across Asia, huge manufacturing, a lot of U.S. investment there.
CHERIN: China has been around the block a few times before. They know how to handle this. And what they see is in the short term there will be some benefit. You're seeing this huge rally on Wall Street. They obviously advantage from that. But I think in the long term, China has some concern for two reasons.
Number one is what mentioned before, is that if there is a dispute that arises, there is really no venue that they can negotiate that in, whether it's the World Trade Organization or the TPP.
The second is China's loves short-term tax breaks. It benefits them. Whether it happens in the U.S. or elsewhere. But what they're most concerned about is the long-term stability of the U.S. economy. And what nobody's mentioning, what really didn't come out of this bill today and what the international markets have yet to react to is the $1.4 trillion that this adds to the U.S. deficit. That will send shock waves China.
VAUSE: Because the currency issue is a big issue for the U.S. and when (INAUDIBLE) these huge defects, you got to get the money from somewhere. So how does the United States end up funding this and -- when you take
a $1.4 trillion out of the world economy to fund these tax cuts, what's the fallout effect?
CHERIN: Again, I think the biggest takeaway today overseas is that the U.S. is going to turn back to those Reagan era trickle-down policies. There is this optimism that if you lower the corporate tax rate from 35 percent to 21 percent, that will be offset by long-term growth.
Again, markets have shown and the international community has shown that they would rather have long-term stability.
VAUSE: It doesn't work, I guess, the whole trickle-down theory, despite what -- how much we want to believe in it. Thanks for coming in.
CHERIN: Thank you.
Well, the bond between a mother and her child is a special thing. But this mother says she and her history making baby could have been friends. We'll tell you the reason why in a moment.
VAUSE: Welcome back, everybody.
This is the scene right now in Washington. It is 12:41 on a Wednesday morning and the Senate is in the final stages of voting on that Republican tax cut bill -- tax reform bill. There have been protests from the gallery as this vote has been carried out. People have been yelling, "Kill the bill, not us."
Those protests have been taking place on Capitol Hill all day long. This is the final stage in the once-in-a-generation overhaul of the U.S. tax system.
(INAUDIBLE) for you.
Well, a woman in Tennessee and her baby have made history. Emma Wren Gibson was born about a month ago. She came from an embryo that was frozen for 24 years. That's the longest known frozen human embryo to end with a successful birth. The National Embryo Donation Center in Tennessee arranged the donation.
Emma's parents say they feel she was destined to join their family. (BEGIN VIDEO CLIP)
TINA GIBSON, EMMA'S MOTHER: Twenty-four-and-a-half years ago, God already knew that she was going to be part of our family. I tear up thinking about it because it's just such a blessing. He's been so good to us. (INAUDIBLE). We're just so grateful.
They're like, well, Tina, this is a world record.
And I just looked at them and I was like, what?
And they're like, yes. It's been frozen for 24.5 years.
And I was like, are you kidding? Oh, my god!
BENJAMIN GIBSON, EMMA'S FATHER: It's still kind of overwhelming to find out that day that we --
BENJAMIN GIBSON: -- all that happened.
TINA GIBSON: Yes, we were --
BENJAMIN GIBSON: -- after going through everything that we went through.
(END VIDEO CLIP)
VAUSE: Dad seems like he's still coming to terms with what happened.
Frozen embryos are often called snow babies as they sit in the storage before the in vitro fertilization.
Thank you for watching CNN NEWSROOM live from Los Angeles. I'm John Vause. Stay tuned with us, "WORLD SPORT" is up next. You're watching CNN.