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Government Funding Talks Stall Five Days Before Shutdown Deadline; Interview with Representative John Garamendi (D-CA), Senator Amy Klobuchar Announces 2020 Bid for President; Aired 8-9p ET

Aired February 10, 2019 - 20:00   ET

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


[20:00:05] ANA CABRERA, CNN ANCHOR: You're live in the CNN NEWSROOM. Thanks for rolling with me. I'm Ana Cabrera in New York.

And as time is dwindling so is optimism that the government will avoid a partial shutdown in just five days. That's when the money runs out in five days. That's when the money runs out. And this deadlock, unlike the first one, the president has no intention of owning. Tweeting today, he believes the Democrats want this shutdown.

Now three sources tell CNN border security negotiations were on track toward an agreement this weekend but now they're questioning if a deal can happen and whether backup plans should now be in place. Some of the sources say that talks have not completely fallen apart but there are two key sticking points that continue to get in the way -- funding for a border wall and the lesser known cap on detention beds for undocumented immigrants detained within the U.S.

Joining us now CNN White House correspondent Boris Sanchez.

Boris, the president is going to El Paso, Texas, tomorrow right to the border, trying to push the border wall funding and his re-election. But what are he and the White House doing to avoid a shutdown?

BORIS SANCHEZ, CNN WHITE HOUSE CORRESPONDENT: Hey, Ana. At this point there's no indication the president or his team are trying any new routes to try to get Democrats to sign off on a proposed bill that to not only keep the government open but fund his vision of border security.

It's really a return to his favorite tactic of bashing Democrats on Twitter. Today he went after them, suggesting that they were acting irrationally and sort of misrepresenting their position on one specific issue.

I should point out his acting chief of staff, Mick Mulvaney, took to the Sunday morning talk shows today, making clear that there are still a number of possibilities on the table. He did not rule out a potential second government shutdown or the possibility of executive action on behalf of the president to try to secure funding for his border wall that way.

He did also say that a deal was still possible. And even though that seems unlikely at this point, there are some lawmakers out there who are optimistic and holding on to hope. Listen to this. (BEGIN VIDEO CLIP)

REP. LIZ CHENEY (R), WYOMING: I certainly hope we're not headed for another shutdown. I think the president has been clear, and the Republicans in the House have certainly been clear that we absolutely have got to secure the border. I'm hopeful that this committee will be able to come up with a proposal that we can all support, that the president can sign.

SEN. JON TESTER (D), MONTANA: We are not to a point where we can announce a deal. Negotiations are still going on. There are good people on this committee, so I have confidence that hopefully we'll get something done very soon.

(END VIDEO CLIP)

SANCHEZ: Liz Cheney and Jon Tester weighing in there.

We should point out, sources have told CNN that if talks do fall apart, Democrats already have a plan B. They've suggested that in the House of Representatives, Democrats would present the bill that would keep the government open and fund the Department of Homeland Security through September.

The question now, if that does pass, is whether Republicans in the Senate would actually sign off on that, let alone if the president would sign off on it, if it ever reaches his desk -- Ana.

CABRERA: All right. Boris Sanchez at the White House for us. Thank you.

Earlier I spoke with Democratic Congressman John Garamendi, and despite the near breakdown in talks he thinks this group of 17 bipartisan negotiators will get the job done.

(BEGIN VIDEOTAPE)

REP. JOHN GARAMENDI (D), CALIFORNIA: I spent a good portion of the weekend with some colleagues on the Republican side, as we toured one of the key American bases here within the United States. They have absolutely no appetite for a shutdown and neither do the Democrats. We don't want a shutdown. We want to work this out, and we will. There's a lot of huffing and puffing going on now, but there's a very clear path to get this done.

CABRERA: Republicans say Democrats keep moving the goal post.

GARAMENDI: Well, everybody is moving the goal post here as they go through all the -- what I call huffing and puffing and pushing each other around. But the reality is that we already, last year, agreed to $1.6 billion for border security. Now exactly what that border security is, is obviously under contention. But I do know this. That we should never give any administration any money until it tells us precisely where it intends to use that money, for what purpose, why it's effective, why it's efficient at that particular place and how are they going to build it? What's it going to cost? Those key element elements ought to be in any bill, whatever the money

might be. So there are issues out there but we'll get past those. We really should. We must. This nation does not need, and there's not a politician here in Washington that can withstand another 35-day shutdown or even a one-day shutdown.

CABRERA: When it comes to the wall specifically, President Trump's acting chief of staff Mick Mulvaney says if there is a deal, but it doesn't have the full $5.7 billion that Trump is asking for, he'll get it without Congress. Listen.

(BEGIN VIDEO CLIP)

MICK MULVANEY, ACTING CHIEF OF STAFF: You cannot take a shutdown off the table and you cannot take $5.7 off the table but if you end up someplace in the middle yet, and what you'll probably see is the president say, yes, OK. And then I'll go find the money someplace else.

[20:05:02] CHUCK TODD, MSNBC'S "MEET THE PRESS": You've been looking for the money in the budget.

MULVANEY: I have been.

TODD: There's this national emergency. Are the two the same or different? Do you find money without declaring a national emergency, or do you need to declare the national emergency to use this other money?

MULVANEY: The answer to the question is both.

(END VIDEO CLIP)

CABRERA: Congressman, it sounds like the Trump administration has a plan B, maybe even a plan C. Do Democrats?

GARAMENDI: Well, absolutely. I'm introducing a bill so that plan B doesn't happen. There's no way we're going to allow the president to take over the power of Congress to appropriate money. There will be a lawsuit immediately, particularly if the legislation does not provide or there is no legislation providing money for a border wall. No president, this or any other president, has the power to appropriate money on their own.

Now under an emergency declaration, there are things that the president can do. What Mulvaney is talking about is going after the disaster recovery money that has been already appropriated by Congress for places like Florida, Texas, California, where the hurricanes were, for fires, as well as for the other places in the United States.

Now if the president thinks he's going to go rip off money that is there to help recover American communities and states from multiple disasters, he's in for a big political headache. We will introduce a bill tomorrow to prohibit that. It's a 1986 provision. Never been used. And it does -- under an emergency. Now what is the emergency? A bunch of mothers and children trying to

cross the border, legally? Seeking asylum? Is that an emergency? I don't think so.

CABRERA: I know Republicans don't agree either with this idea of going forward with a national emergency declaration.

Let me pivot because you're on the House Armed Services Committee as we mentioned.

GARAMENDI: Right.

CABRERA: And on Friday the White House missed the deadline to report to Congress whether they hold Saudi Crown Prince Mohammed bin Salman responsible for the murder of "Washington Post" journalist Jamal Khashoggi.

What does Congress do about this?

GARAMENDI: Well, there's several things that we will be doing. There's legislation introduced that would set up a different relationship with Saudi Arabia. Certainly the arms sales to Saudi Arabia require congressional approval -- an authority, then approval. So all of those things are in play. We will take action. There clearly has to be a punishment for what has happened here. There's more and more evidence that the crown prince himself was directly involved.

Sanctions are possible. We could move sanctions through the Congress. That probably would require the president to sign on to that. But there are must-pass pieces of legislation that would deal with that. Bottom line of this is that we should not, as a nation, countenance or even cozy up to anyone that has done such a horrible, terrible thing as happened to this journalist.

CABRERA: Let me ask you quickly before I let you go about the expanding Democratic field for 2020. This weekend it got bigger. Senators Elizabeth Warren and Amy Klobuchar both making it official, and Warren even picked up a couple of endorsements from Congressman Joe Kennedy as well as Senator Ed Markey.

Are you ready to endorse anyone?

GARAMENDI: No, I'm not. We have some terrific candidates running, those -- there are actually three women from the U.S. Senate that are running, one happens to be a Californian who I know very well. There will be time this thing will sort itself out. And obviously there are going to be a whole lot more players on the field before this gets down to the elimination rounds.

CABRERA: We do a lot of polling with Democratic voters to find out what's important to them. But let me ask you, what is the number one thing that will determine who you ultimately decide to get behind?

GARAMENDI: Well, there are about half a dozen things. I'll go through them quickly. Are they really prepared to deal with climate change? Are they prepared to not -- to get beyond the rhetoric and down into the weeds about what we can do? Are they prepared to be strong internationally and really backfill from the terrible troubles that the current president has caused with our international relationship, particularly with our allies?

I want to make sure that they are full in on education at every level. And I want to make sure that they care about the middle class, that they have programs that will help the middle class. If they're in for those things and they're capable -- all of them are capable, at least from what I've seen thus far. And they're able to articulate and show the leadership necessary, they'll have my endorsement.

(END VIDEOTAPE)

CABRERA: That was John Garamendi for us.

Coming up, the Democratic field continues to expand as Minnesota Senator Amy Klobuchar greets a crowd amid heavy snow freezing temperatures. We're live in Minneapolis, next.

(COMMERCIAL BREAK)

[20:13:58] CABRERA: The race for the White House 2020. Today add one more Democrat to the field of declared candidates who want to face President Trump next year.

(BEGIN VIDEO CLIP)

SEN. AMY KLOBUCHAR (D), PRESIDENTIAL CANDIDATE: Hello, everyone.

(END VIDEO CLIP)

CABRERA: Minnesota Senator Amy Klobuchar made her official entry into the presidential race this afternoon. She proclaimed herself a candidate for the White House in a very snowy, subfreezing day in the Twin Cities.

(END VIDEO CLIP)

KLOBUCHAR: I am running for every American. I am running for you. And I promise you this. As your president, I will look you in the eye. I will tell you what I think. I will focus on getting things done. That's what I've done my whole life. And no matter what, I'll lead from the heart.

(END VIDEO CLIP)

CABRERA: CNN's Suzanne Malveaux is live in Minneapolis.

Suzanne, that was the most Minnesota way to make a major announcement during practically a blizzard.

[20:15:03] What did Senator Klobuchar say she will bring to this race?

SUZANNE MALVEAUX, CNN NATIONAL CORRESPONDENT: Sure, Ana. Well, it was -- it really was quite an amazing moment. It was 14 degrees outside like it is now but under heavy snow when she officially kicked off the race. And her main message here was she was going to bring heart and the heartland into this race, that she's focused on the Midwest, the region, that many Democrats feel was neglected back in 2016.

(BEGIN VIDEOTAPE)

MALVEAUX (voice-over): Senator Amy Klobuchar, jumping into the 2020 waters, making the announcement along the Mississippi River in her home state of Minnesota.

KLOBUCHAR: Let us cross the river of our divides and walk across our sturdy bridge to higher ground.

MALVEAUX: The 58-year-old third-term senator talked up her heartland heritage and her ability to get things done.

KLOBUCHAR: I will look you in the eye. I will tell you what I think and no matter what, I'll lead from the heart.

MALVEAUX: Klobuchar joins an increasingly crowded Democratic field including fellow Senate Judiciary Committee members Cory Booker and Kamala Harris. It is from that committee perch last fall that Klobuchar captured the national spotlight with her questioning of then Supreme Court nominee Brett Kavanaugh.

KLOBUCHAR: So you're saying there's never been a case where you drank so much that you didn't remember what happened the night before or part of what happened?

BRETT KAVANAUGH, SUPREME COURT JUSTICE: You're asking about a blackout. I don't know. Have you?

MALVEAUX: The exchange for which Kavanaugh later apologized went viral.

KLOBUCHAR: Could you answer the question, Judge? Just -- so you -- that's not happened? Is that your answer?

KAVANAUGH: Yes. And I'm curious if you have.

KLOBUCHAR: I have no drinking problem, Judge.

MALVEAUX: Klobuchar later said she was stunned by the moment, which also let her discuss her own experience growing up with an alcoholic father.

KLOBUCHAR: My dad is 90 now. Struggled with it throughout his life and finally got treatment and is sober.

MALVEAUX: With her national profile elevated, Klobuchar coasted to reelection in 2018 with 60 percent of the vote, winning 42 counties carried by Donald Trump in 2016.

KLOBUCHAR: You go where it is uncomfortable, not just where it's comfortable. And that's how we're going to win the Midwest. MALVEAUX: A graduate of Yale University, Klobuchar interned for

fellow Minnesotan Walter Mondale in his Senate office.

KLOBUCHAR: I thank Vice President Mondale who's here with us who has been a mentor to me.

MALVEAUX: Klobuchar says Mondale's choice of running mate in 1984, Geraldine Ferraro, the first woman on a major party ticket, opened her eyes to the future of women in politics.

KLOBUCHAR: For me, it was a moment when I knew that anything and everything was possible for women in the United States of America.

MALVEAUX: In 1998, Klobuchar was elected attorney of Minnesota's most populous county. Eight years later she became the first woman elected to represent the state in the U.S. Senate.

KLOBUCHAR: I left Minnesota with my husband and our daughter and loaded up our Saturn with our college dishes and a shower curtain from 1985.

MALVEAUX: On Capitol Hill, Klobuchar has partnered with Republicans on issues such as online privacy, workplace harassment and prescription drug costs, earning respect across the aisle. Bipartisan credentials Klobuchar hopes will give her an advantage in the campaign to come.

(END VIDEOTAPE)

MALVEAUX: And the president wasting no time in reacting to her jumping into the race tweeting today, saying, "Amy Klobuchar announced that she's running for president, talking proudly of fighting global warming while standing in a virtual blizzard of snow, ice and freezing temperatures. Bad timing. By the end of her speech she looked like a snowman-woman."

And Klobuchar pouncing back, and the president this evening, her own tweet responding, saying, "Science is on my side, Real Donald Trump, looking forward to debating you about climate change and many other issues and I wonder how your hair would fare in a blizzard," and there's a snowman emoji -- Ana.

CABRERA: All right. Suzanne Malveaux, braving the cold temperatures for us yet again. My nose would be looking like Rudolph if I were out there right now. Thank you for being a warrior tonight. We appreciate it.

MALVEAUX: Thank you.

CABRERA: Right. Another Democratic presidential candidate Senator Elizabeth Warren, barnstorming Iowa today, one day after officially announcing her 2020 bid. She's also taking a few jabs at the president.

SEN. ELIZABETH WARREN (D), PRESIDENTIAL CANDIDATE: By the time we get to 2020, Donald Trump may not even be president. (CHEERS AND APPLAUSE)

WARREN: In fact, he may not even be a free person.

(END VIDEO CLIP)

CABRERA: The Massachusetts senator also doubled down on saying Trump is racist.

(BEGIN VIDEO CLIP)

[20:20:03] UNIDENTIFIED REPORTER: Senator warren, you said bigotry has no place in the White House. Some of your Democratic colleagues have just straight up come out and said President Trump is racist. Are you willing to say that? Is he a racist?

WARREN: I've already said that many times. Go back and look at the tapes. I don't think there's much doubt about that.

(END VIDEO CLIP)

CABRERA: Those comments come just a day after Trump mocked Warren over her ongoing heritage controversy, tweeting, "Will she run as our first Native American presidential candidate or has she decided that after 32 years this is not playing so well anymore?"

Plenty to digest from this busy weekend on the campaign trail, as Amy Klobuchar becomes the latest Democrat to believe she can beat President Trump.

CNN political analyst and chief political correspondent for "Esquire" Ryan Lizza is joining us now.

Ryan, let's start right there with Klobuchar. The last Democratic presidential nominee from Minnesota, Walter Mondale, got crushed in 1984 against Ronald Reagan. Hillary Clinton barely won the state in 2016.

How does Klobuchar expect to win over so many parts of the Midwest that went to Donald Trump?

RYAN LIZZA, CNN POLITICAL ANALYST: Well, it's -- you know, look, Hillary Clinton came within 70,000 votes of winning the election. And she had -- she flipped 70,000 votes in Wisconsin, Michigan, and Pennsylvania, she would be president. So it's razor thin there in the Upper Midwest. And Klobuchar going right at that electability argument in her announcement speech today.

She won, as Suzanne pointed out, with 60 percent in her last election. And, you know, that is -- a lot of the sort of smart consultants in the Democratic Party believe the Upper Midwest should be the focus for the Democrats come general election time, not the southwest, you know, not the sun belt but the Midwest. And she has a track record of success there. So very different than Mondale, who lost 49 states and only won Minnesota. CABRERA: Now let's move on to Elizabeth Warren because you saw her

blunt warning, that President Trump might not even be a free person come 2020. It seems to be maybe a change in strategy, taking him on so directly.

LIZZA: Yes.

CABRERA: What does that tell you?

LIZZA: I mean, you know, the cynical part of me says maybe she's -- you know, she's been in a little bit of a tough series of news cycles over the story that has dogged her for a while now about her -- how she has or hasn't used her lack of Native American heritage, right? And I thought maybe she was trying to get past that, trying to move -- look, attacking Trump or Trump attacking you is the best thing that happens to a Democratic candidate, right?

I'm sure Amy Klobuchar was very excited today when she saw Trump tweeted at her and attacked her. There's nothing better for a Democrat. The Democratic Party is -- you know, there are a lot of differences in the Democratic Party. One thing it is defined by, obviously, anti-Trumpism. So that's always a blessing to a candidate to have something like that. And I think maybe Elizabeth Warren was trying to take the fight a little bit more to Donald Trump to change the news that's been dogging her recently.

CABRERA: I wonder if his attack, because he hasn't attacked every candidate that's jumped in, means something.

LIZZA: A great point.

CABRERA: Does he see these two women as a big threat?

LIZZA: I think that's a great point because look, if you're not getting attack by Donald Trump, what are you doing wrong, right? And I think it's really he has gone after Elizabeth Warren since before people were even sure she was going to run for president. So there's something about Elizabeth Warren that has just -- has him a little either worried or obsessed. But -- so I think he is -- he's obviously -- you know, understands politics. And so I think the people that he sees as somewhat threatening get a little bit more of a vicious tweet.

I think as a Democratic candidate, you have to worry when he's not attacking you.

CABRERA: Which seems so strange, right? Well, what's the contrast --

LIZZA: It means he's not scared of you, right?

CABRERA: He's scared of you, that may be what it is. We'll see. Let's contrast, though, what Warren said with Cory Booker's approach. Listen to him.

(BEGIN VIDEO CLIP)

SEN. CORY BOOKER (D), PRESIDENTIAL CANDIDATE: I'm not here to try to emulate the tactics of a president. I'm not trying to match him ugly comment for ugly comment, bashing for bashing. I'm focusing on the people.

(END VIDEO CLIP)

CABRERA: Is that smart strategy, considering just how much rage there is in the Democratic Party toward the president?

LIZZA: I thought that was one of the more interesting comments right now because there is this tactical debate that is playing out in the Democratic Party of how -- how much do you askew the tactics of Trump, don't take the bait and make sure that all of your communications, speeches, social media, does not mirror what he does, right? And there are other candidates who are saying no, you've got to come right back at him the same way he comes at us.

[20:25:01] I think Booker is trying to argue that may create a race to the bottom. And he's betting that Democrats don't want a replica of Donald Trump. They want a replacement. And so I think that tactical debate is going to -- we're going to be seeing that for the next two years play out among Democrats. And I think there is a danger, frankly, of, you know, emulating the president sort of bringing politics down into the gutter and, you know, it works for Trump. It won't necessarily work for everyone else.

CABRERA: It's that question about authenticity, right? Because if you can't do it, and be yourself in doing it, does it really work? We saw a lot of GOP candidates had a hard time with trying to go toe to toe and get in the mud.

LIZZA: Exactly. Remember when Marco Rubio tried to do his stand-up routine?

CABRERA: Right.

LIZZA: And I think he has said, acknowledged he regretted it. It did not work for him because he wasn't authentic to who he is.

CABRERA: Right. Didn't work for him. Didn't work for Jeb Bush. We digress.

Let's focus forward. But I do want to bring up one thing that is maybe backward looking. It was 12 years ago, Barack Obama launched his presidential campaign. We recall when Hillary Clinton, she started early in the 2008 race but she waited to launch her 2016 bid.

Now I bring those former presidential candidates up because of timing. The question of timing.

LIZZA: Yes.

CABRERA: When is it too late for other Democrats to get in? We already have almost double digit number who have said they are running. Have those who haven't gotten in, Bernie Sanders, Joe Biden, Beto O'Rourke, who knows who else -- have they lost the staffers and the money they would need? LIZZA: I think that the more well-known you are, the later you can

jump in the race. You know, you want to lock up the donors and the staffers early if you're a little less well known. So if you are Hillary Clinton, you can probably wait a little longer. I think all indications are that she's not going to run but there will be a moment as this primary plays out and the candidates start attacking each other, and some candidates stumble and there will be some early departures as there always are.

There's always a moment in, like, the fall where the candidates have been at each other for so long that the voters start to look around and say, is this all we have? Is there anyone else that can jump in? I think that's the moment you'll start to see a second wave, maybe there'll be a third wave by then, of candidates who think -- who didn't jump in early and rethink it.

Look, Bill Clinton, in 1990, he entered the race in October of 1991. Now that's -- you know, that's a long time ago, but it's --

CABRERA: In October?

LIZZA: October of '91.

CABRERA: There you go. It's a long way from now.

LIZZA: Just a few months before -- yes. So, you know, the -- yes, the general thinking is, though, the earlier the better if you're not that well known.

CABRERA: All right. Ryan Lizza, we've got a long ways to go. It will be interesting to see the twists and turns along the way. Thanks as always for being here.

LIZZA: Thanks, Ana.

CABRERA: And those are live pictures of Elizabeth Warren. She is hitting the ground running here in the first days of her campaign.

All right. Defiance and denial. Virginia's top two lawmakers refusing to step down amidst scandals causing national outcries. So how do Virginia voters feel about this? We're live in Richmond, next.

[20:30:00] (COMMERCIAL BREAK)

ANA CABRERA, CNN HOST: Still no sense of how the chaos in Virginia state capital will get sorted out, as the state's top three elected officials, fight for their political lives. Governor Ralph Northam and Attorney General Mark Herring, are both embroiled in blackface scandals.

Meanwhile, Lieutenant Governor Justin Fairfax is now defending himself against sexual assault allegations made by two women. In a new interview with CBS, Governor Northam says he wants to help heal wounds caused by this racist photo in his medical school yearbook.

(BEGIN VIDEO CLIP) GOV. RALPH NORTHAM (D), VIRGINIA: Right now, Virginia needs someone that can heal. There's no better person to do that than a doctor. Virginia also needs someone who is strong, who has empathy, who has courage and who has a moral compass. And that's why, I'm not going anywhere.

(END VIDEO CLIP)

CABRERA: CNN's Kaylee Hartung joins us now from Richmond. Kaylee, Northam thinks -- he thinks he can heal the racial pain there, in Virginia. Are his comments today, helping or hurting?

KAYLEE HARTUNG, CNN CORRESPONDENT: Well, Ana, Ralph Northam is not a career politician. As you just heard him there, he's a doctor. Today, in a conversation with CBS, there was an awkward moment, as he tried to put this past painful week, in the context of Virginia's complicated history of racial division. Listen here.

(BEGIN VIDEO CLIP)

NORTHAM: What has been a difficult week, and, you know, if you look at Virginia's history, we're now at the 400th-year anniversary, just 90 miles from here, in 1619, the first indentured servants from Africa landed on our shores in old point comfort, what we call now Fort Monroe. And while --

GAYLE KING, ANCHOR, CBS NEWS: Also known as slavery.

NORTHAM: Yes.

KING: Yes.

(END VIDEO CLIP)

HARTUNG: I spoke with one politically engaged Virginia voter today who said he saw that moment as an unartful attempt by Northam to use less offensive language in putting this all into context. Ana, when you listen to that conversation on a larger scale, you see that he's trying to speak to Virginians, the people who put him into office.

Those are the same people who don't like to be reminded of Virginia's painful past, despite the fact this week has made them confront a not so distant past of racial tension.

[20:35:00] CABRERA: Let's talk about the allegations facing the Lieutenant Governor, the women who accused Lieutenant Governor Justin Fairfax of sexual assault, now saying they are willing to testify against him at an impeachment hearing. Is that where this is headed?

HARTUNG: Well, the first steps are being taken in that direction, Ana, member of the House delegates. Democrat Patrick Hope has said first thing tomorrow morning, he will introduce articles of impeachment to the legislature. He shared a resolution with his fellow Democrats today. Our Ryan Nobles obtained that resolution. In it, he outlines his reasoning for wanting to pursue impeachment. And we are just receiving a response from a spokesman on behalf of Justin Fairfax, in reaction to this. He says he believes that an inherently political process is not the most likely path for learning the truth. The Lieutenant Governor is confident in the truth that will emerge from an independent impartial investigation.

Ana, again, the introduction of these articles of impeachment tomorrow, just the first step in a long process, in order for this resolution to be brought to a vote. The Speaker of the House has to support it, and that Republican speaker has not indicated that he will do so. Ana?

CABRERA: All right, Kaylee Hartung, good reporting for us, thank you, in Richmond, Virginia.

Are you feeling the financial squeeze this tax season? You're not alone. Refunds have fallen an average of eight percent. Our money expert explains why, next.

(COMMERCIAL BREAK)

[20:40:00] (COMMERCIAL BREAK)

CABRERA: Next time you hear the President or senator or any politician, tout the new tax overhaul that gave the wealthy, big cuts, and was supposed to benefit all of us, consider this, the IRS reports the average tax refund is down about eight percent under the first full year of this overhaul tax code.

What does that mean in dollars and cents? Current refunds averaged $1,865, that's down from the average of $2,035 last year. Here to break it down for us, Financial Planner and Founder of Dynamic Money, Chris Burns. Chris, people are getting less money back, why? Was the tax reform supposed to provide tax relief?

CHRIS BURNS, FOUNDER AND PRINCIPAL DYNAMIC MONEY: Yes. Well, first of all, let's just admit it's terrible. When you think you're going to get all this money back, you already have plans for it, right? So folks already knew they're going to put a down payment on a house, they're going to pay off that debt.

So, this is really hard for a lot of people. But to understand why it happened, you have to actually walk back last year, this time, and remember at that point, Treasury was running around, trying to figure out how in the world do we implement this thousand-plus tax change that's just been passed by Congress?

And one of the big pieces of that was changing the whole withholding system, OK? So, back last February, a lot of people -- most Americans saw some sort of little bump to their payroll. And for a lot of people, it was so small, it was almost laughable.

If you made $70,000 a year, your average increase was about $40 a paycheck. And for most folks, that was kind of throwaway money. They said, they didn't even really notice it, right?

CABRERA: Maybe an extra dinner out.

BURNS: I'm sorry? Oh, yes, exactly. It's an extra dinner out, it's a night at the movies, whatever it is.

CABRERA: Yes.

BURNS: But if you take that over the course of a year, well, that's $1,000, right? And so, the hard reality of this -- and this is not easy -- is that, most people, even though it feels like they've made less money, because that tax return is eight percent or the refund is eight percent lower, well, they might have actually made more money over the course of the year, but it was so spread out, they don't notice it.

And then, when they get a few hundred dollars less on the refund, it feels like a punch in the gut.

CABRERA: OK. So, that really does explain a lot. It doesn't necessarily mean people aren't taking home more money but, if somebody is getting this and, as you point out, has already spent the money they thought they were going to get in their refund, because they didn't make the can calculations adjustments in their own head or, you know --

BURNS: Sure.

CABRERA: -- own planning. What should they do now to adjust moving forward?

BURNS: OK. So, this is a tough question. And a lot of people won't like my answer here, I'll tell you in advance. One thing you can do is, you could go and you could change your withholding again, and give the IRS more of your money and next year, you'll get that refund again.

So, if you miss that refund and you go, that is what I was banking on, you could easily go change that and get the refund again. But, we have to go back to this idea of what is a tax refund? And I think a lot of us treat -- I mean, over 70 percent of Americans get a refund, like you said, the average is over $2,000 a person.

So, something so many people are banking on. But, what is it? Well, imagine this for a minute. If you were to go to the grocery store, let's just say, to buy milk, and then you paid $10 extra. I don't know why, they just overcharged you. And every time you went, all- year, you paid an extra $10.

Then, at the end of the year, they came back to you and said hey, we are so sorry. You overpaid us $1,500 for milk, we're going to send you a check. Would your response be, this is amazing? This is the absolute, best thing ever, right, or would you go, why in the world did I overpay you all-year?

We're just so used to giving the IRS extra money that's not theirs. And then, what do they do with it? Well, I don't earn interest on it. I don't have access to it. They just sit on it. And let me tell you, the IRS is good at a lot of things, but they're not a good babysitter, but they're babysitting your money when you do that.

CABRERA: All right. So, maybe it's a good reason why not having such a big tax refund at the end of the day, isn't so bad. Tax -- Chris Burns, thank you for the tax insight, tonight. I appreciate it.

BURNS: Sure. Hey, thank you so much.

CABRERA: Coming up, taking a backseat. Prince Philip surrenders his driver's license as investigators weigh charges after a January crash.

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[20:45:00] (COMMERCIAL BREAK)

CABRERA: Actor Rob Lowe is facing backlash after what he calls a joke, fell flat. Lowe took a shot at Massachusetts Senator Elizabeth Warren, after her announcement that she's running for president. He posted this, on Twitter.

Elizabeth Warren would bring a whole new meaning to Commander in "Chief" with the word, chief, in quotation marks, apparently, referring to the Senator's history of claiming Native American heritage. Now, Lowe deleted that tweet after a tidal wave of angry backlash from readers online. He then tweeted, "It was a joke and some peeps got upset."

Britain's Prince Philip has decided he's done driving at the age of 97. He turned in his driver's license as part of a fallout from a January crash. CNN's Anna Coren has more from London.

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ANNA STEWART, CNN INTERNATIONAL CORRESPONDENT: It's been a little over three weeks since Prince Philip was involved in this car accident, a shocking collision that everyone was very fortunate to be able to walk away from.

[20:50:03] The police have been investigating it, like they would any other car accident, and have now passed on the file to the CPS, the Crown Prosecution Service, who will now decide whether or to press charges. Now, the most likely charge, if there is one, would be driving without due care or consideration.

That can lead to a fine plus points on a driving license or even its disqualification. Of course, the Prince has actually now voluntarily surrendered his driving license. And that will be taken into consideration by the CPS and all of this.

Now, one of the ladies involved in the accident, from the other car, who broke her wrist, has spoken to British tabloid, the Sunday Mirror, today, welcoming the news that Prince Phillip surrendered his driving license, saying he could have done it sooner.

It must have been a very difficult decision for Prince Phillip. He retired from public life, two years ago, and he's always really valued his independence and he's a keen driver, often seen behind the wheel over the years. He once, of course, drove President Obama and the First Lady, when they visited Windsor.

He'll probably have to put up with being driven from now on and await the decision by the CPS, as to whether he will be summoned to court. Anna Stewart, CNN, London.

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CABRERA: Thank you, Anna Stewart. I got my Annas mixed up, earlier.

Coming up, an exclusive look inside Facebook, how the company's tremendous growth has also brought tremendous problems.

UNIDENTIFIED MALE: There is a bit of a Game of Thrones culture among the executives.

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CABRERA: It started as a college experiment, and now 15 years later, Facebook is a tech giant, with more than 2 billion users worldwide. But as with all 15-year-olds, the company has had its share of growing pains and missteps from massive data breaches to concerns about user privacy. It hasn't exactly been smooth sailing.

A new CNN special report, Facebook at 15: It's Complicated, gives us a rare inside look at the tech giant. Here's a preview.

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LAURIE SEGALL, CNN SENIOR TECH CORRESPONDENT: It's October 19th, 2018, and we are heading to Facebook. This is a really big deal. We're going to sit down with Mark Zuckerberg, who rarely sits down for interviews. Facebook years are like dog years. A lot happens in a little time. In the months since I first walked through these doors.

UNIDENTIFIED FEMALE: Nearly 50 million Facebook users have been targeted by hackers.

UNIDENTIFIED FEMALE: The largest security breach in Facebook history.

UNIDENTIFIED FEMALE: Facebook on the defensive today (INAUDIBLE) damning New York Times report on how Facebook has handled its bad P.R. --

SEGALL: And we'll get to all that later, but for now, back to Facebook, and what you need to know about an interview with Mark Zuckerberg.

UNIDENTIFIED FEMALE: It's to get cold.

SEGALL: First, he likes a room cold, very cold. Turn the cameras around and you'll see his people on the other side, they're taking notes, scribbling furiously, keeping time. They know that the stakes are high these days. The whole world seems to be watching. And that's Facebook in its current moment. MARZ ZUCKERBERG, CEO, FACEBOOK: Thank you for coming --

SEGALL: Massively influential.

UNIDENTIFIED FEMALE: Facebook CEO Mark Zuckerberg under fire.

SEGALL: Influx.

UNIDENTIFIED FEMALE: The biggest security breach in the history of Facebook.

SEGALL: And controversial. But to fully understand Facebook of today, you have to go back to the beginning.

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CABRERA: There you go. There's your teaser. CNN Business Senior Tech Correspondent Laurie Segall, is joining us now. This is your baby, Laurie, and I know you've been working on this long time.

SEGALL: Yes.

CABRERA: And you've had incredible, incredible access and insight into Facebook's world. When you pulled back that curtain, I mean, you were there during the height --

SEGALL: Right.

CABRERA: -- of the most recent scandal. What was that like?

SEGALL: Yes. Look, I mean, I remember walking in during the Cambridge Analytica scandal in March 2018. This was such a pivotal moment for the company and Mark Zuckerberg doesn't like doing on-cam interviews. He hadn't been out there that much.

And I just remember it was this moment that so many people wanted to hear from Mark Zuckerberg. And for me, having covered tech for many, many years, it was this moment that tech almost had become mainstream because everyone wanted to know, everyone was upset about Facebook, and this data scandal, and everybody wanted to hear from Mark Zuckerberg.

And so, you know, you weave in and out of this company throughout the years and you begin to understand why they're in the position they're in, what the challenging questions are going forward. And that's -- what we try to do in this documentary is kind of go back to the beginning and look at that.

CABRERA: What do you hope people take away from the documentary tonight?

SEGALL: Well, you know, look, I think it's really easy to look at Facebook right now. But I also think you almost, to understand where it is, right now, you have to go back to that beginning. And I hope people look at the complications that the privacy scandals throughout, you know, Facebook history, they'll get a better idea of Mark Zuckerberg.

We speak to Mark Zuckerberg and Sheryl Sandberg and I don't think a lot of people know who Mark Zuckerberg is, and more people want to know who he is. And I think, you know, this next phase of technology, which is very complicated, deserves our participation, you know, deserves us, being able to weigh in and understand the nuance and the debate around issues like free speech and data and privacy.

And I think, educating ourselves and, you know, how we got to where we're at is very important. I hope people get that from taking a look at this, tonight.

CABRERA: Look forward to seeing it. Thank you so much Laurie Segall.

Join CNN's Laurie Segall as she talks exclusively with Facebook insiders, what is really going on inside the most powerful social media company on Earth. The CNN special report Facebook at 15: It's Complicated, airs, next. That does it for me, tonight. Thank you so much for joining us. I'm Ana Cabrera. Have a great night and a great week ahead.