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GOP Split Over Threat of Shutdown; Colorado Turns Focus on Recovery; Jobless Claims Rise Less Than Forecast; Navy Yard Reopens; McCain Hurls Insults at Putin

Aired September 19, 2013 - 09:00   ET

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

(BEGIN VIDEOTAPE)

REP. JOHN BOEHNER (R), HOUSE SPEAKER: We're going to continue to do everything we can to repeal the president's failed health care law.

COSTELLO: A threat intensifying and America getting tired of the same thing happening again.

Also, breaking overnight, a huge explosion in Oklahoma. A chemical plant bigger than a football field blowing up, sending flames almost 100 feet into the air.

And, we have a winner. Lexington, South Carolina, home to the latest $400 million Powerball winner.

You're live in the CNN NEWSROOM.

(END VIDEOTAPE)

COSTELLO: We can only dream. Good morning to you. I'm Carol Costello. Thank you so much for being with me this morning.

We begin on Capitol Hill. The clock is ticking and the risk of a government shutdown growing. With only enough money to keep the government running another 11 days, Republican leaders say they will approve new funding only if Obamacare is defunded.

The president is calling it extortion and even some Republicans disagree on this high-stakes political gamble.

(BEGIN VIDEO CLIP)

BOEHNER: Our goal here is to cut spending and to protect the American people from Obamacare. It's as simple as that.

REP. PETER KING (R) NEW YORK: We can't let the government shut down. We can't be kamikazes and we can't be General Custer.

(END VIDEO CLIP)

COSTELLO: There is backlash from Americans who feel the bite of a shutdown. Many government offices would be closed along with museums and parks. Many federal projects would be delayed, meaning contractors and subs would be out of work. That's along with the many federal workers who would be furloughed. Mail, however, would still be delivered. So, see, there's a bright note in there, right?

CNN's Erin McPike is in Washington this morning as the GOP-controlled House gets ready to vote as early as tomorrow.

Good morning, Erin.

ERIN MCPIKE, CNN CORRESPONDENT: Good morning, Carol. Well, the problem for House Republicans is if they can pass this bill tomorrow, that would fund the government but defund health care, Republicans say they know that kind of legislation would not pass the Democratic- controlled Senate and of course the president wouldn't sign it because he would never sign a law that would overturn his signature achievement, which is health care reform.

Now here's the problem that happens if the Republicans are able to pass this bill. The Senate could then pass a bill that both funds the government and health care and then they would send that bill back to the House. Now, if that bill fails, that would shut down the government and that would be, of course, deeply unpopular with the American people. And senior Republicans are saying that is an ill conceived strategy.

This summer Oklahoma Senator Tom Coburn made some remarks about that. Here's what he had to say.

(BEGIN VIDEO CLIP)

SEN. TOM COBURN (R), OKLAHOMA: The only effective way to truly stop Obamacare, and I think we ought to do it, to stop it, would to be totally reverse it. We don't have the votes to do that.

(END VIDEO CLIP)

MCPIKE: And, Carol, just this morning, Karl Rove wrote an op-ed for the "Wall Street Journal" who said -- and he said much the same thing. I want to read part of that to you. He said, "Any strategy to repeal, delay or replace the law must have a credible chance of succeeding or affecting broad public opinion positively. The defunding strategy doesn't. Going down that road would strengthen the president while alienating independents. It is an ill-conceived tactic and Republicans should reject it."

Now, Carol, there's one more thing that I want to tell you about this. Just last week I was talking to some senior House Republican leadership aides and they said they didn't want to hold this vote because they think they're being held captive by the farther right, more conservative groups who say they are just looking for a list of House Republican members that they can then mount primary challenges against, so they didn't want to hold this vote just last week and now they are being moved further to the right -- Carol.

COSTELLO: OK. My head is about to explode. So it seems like the Republican Party is in disarray. So why didn't House Speaker John Boehner -- because he's not totally for this strategy, yet he came out and said we're going to -- we're going to do this strategy and see what happens. But why didn't he take a stand? MCPIKE: Well, Carol, that's the big question now. But I will tell you that just last week there were some Tea Party rallies on Capitol Hill, and some of these Tea Party members have said, Speaker Boehner, if you don't move forward with this, we want to see you go. So he is also being held captive by the further right -- Carol.

COSTELLO: We're going to talk a lot about this, this morning.

Erin McPike, thanks so much, reporting live from Washington.

As the rising floodwaters in Colorado recede, a new worry is growing across the state as to what might be getting into the groundwater. Fuel, heavy metals and fluids used in fracking, a process that cracks the ground for drilling, might be mixing with the floodwaters and possibly seeping into the water supply.

More than 1800 oil and gas wells had to be turned off and right now the Colorado Oil and Gas Association says there are no reports of leaking oil or gas wells, but a leak is not the issue, it's the chemicals and the toxic fluids combining with the water that's the issue. That water could end up in lakes or rivers used for drinking.

Scientists say the state will have to be vigilant about testing and fixing any problems.

And after a week of rescues from those floodwaters, the focus in Colorado also turns toward recovery. Evacuations are slowing down in places like Boulder and Larimer Counties, two of the hardest-hit areas in last week's flooding.

In Boulder County there are just a handful of people still unaccounted for and the rebuilding costs could be overwhelming.

George Howell is live in Boulder again this morning.

Good morning, George.

GEORGE HOWELL, CNN CORRESPONDENT: Carol, good morning. So the latest estimate that we've heard, some $2 billion. It will take up to $2 billion to start repairing all the damage that we've seen. And when you look at some of the video that people have sent us of the raging waters that we saw just seven or eight days ago, you get a sense of exactly why. We're talking about waters that in many cases washed roads away, washed homes away.

A big deal, a big mess that people will have to deal with and clean up from. You know, it could take a long time before things are back to normal here.

I want to show you where we are now. You can see back here this river and you can see that barn that shouldn't be there. The river shouldn't be there either. In fact all of this changed within a matter of hours, I would say.

Jim Fitzgerald is here and, Jim, this is your property. You were telling me that's -- it used to be grass out there? So what do you do? How do you start over?

JIM FITZGERALD, FLOODING VICTIM: Used to be a pond right here and right below the pond was a tennis court. And all of the rest of it was grass and mowed and decorative.

HOWELL: Yes.

FITZGERALD: You know, in a matter of minutes really on Thursday night this just dumped probably 500 truckloads of debris, rock and filled the pond and covered -- blew out the tennis court, another shed, and filled my basement with four feet of mud.

HOWELL: Wow.

FITZGERALD: It's been -- it's been a nightmare, but we will rebuild. And we're safe. Some of my neighbors are much worse than I am. It will take us months and months to kind of start to put it back into order. You just pick up and keep on going. We're blessed that everybody in this area is safe and I thank the Lord for that.

HOWELL: Jim, I want to talk about these barriers, a few of these median barriers. So what are you going to do with those?

FITZGERALD: What's happening right now is the creek is still at a flood stage and it's been washing out the embankment right here, starting to wash out underneath the road as well as wash out toward my leech field, which is my septic system. If it gets into that septic system, it will destroy that and then it will start eroding down toward the foundation of my building.

(CROSSTALK)

HOWELL: Push the water --

FITZGERALD: So we're going to try and use that to push the water a little bit away from here. It has dropped -- it's dropped probably at its peak 10 feet.

HOWELL: Thank you, sir. Thank you very much.

FITZGERALD: Yes. OK.

HOWELL: And you get a sense of, you know, what people are dealing with, Carol, right -- right now. We know, and this is good news, the number of unaccounted for at 201. You can hear the helicopter over my head right now, the search and rescue continues today.

COSTELLO: All right, George Howell, and our thanks to Mr. Fitzgerald as well.

Just about a half hour ago, we learned of the number of Americans filing new unemployment claims rose last week, but not as much as experts had predicted. New Labor Department data shows initial claims for jobless benefits grew to a seasonally adjusted 309,000.

In the meantime, investors are still giddy. Stock futures up again this morning after the Dow and the S&P closed at record highs on the news the Fed will keep pumping money into the economy.

Alison Kosik is at the New York Stock Exchange with more on that.

Good morning, Alison.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Good morning, Carol. And yes, the bulls will keep on running this morning, this after those stunning record highs not just on the Dow but on the S&P 500 as well. One trader putting it this way, it's happening because the Fed is not stopping the party just yet. Keeping the party going, pouring billions of dollars into the financial system.

But the trader also telling me, wait, let's understand why this is happening, why the Fed kept the status quo. He says it's because the economy isn't all sunshine and roses at this point. You look at unemployment. The unemployment rate is still at 7.3 percent. It's high.

Growth in this country is still very weak. It's at 2.5 percent. You really want to see it around 3, 3.5 percent to be considered normal. But at this point the Fed is acting as a safety net. It's not leaving the economy alone until it's on stronger footing -- Carol.

COSTELLO: Alison Kosik, reporting live from the New York Stock Exchange.

Other stories we're following this morning at 10 minutes past the hour, Iran's president says his country will never develop nuclear weapons. Hasan Rouhani also told NBC News he's open to resolving Iran's controversial nuclear program through diplomacy. He said his government has complete authority to make a deal and called a recent exchange with President Obama on the matter positive and constructive.

Flooding and mudslides spawned by tropical weather along both Mexico's coasts have killed at least 80 people and left some 40,000 tourists stranded. Hurricanes Ingrid and Manuel have affected more than a million people and now a third tropical system is developing off Mexico's Yucatan Peninsula.

A fire engulfs a chemical plant northwest of Oklahoma City and forces the evacuation of nearby homes. The fire at the Danlin Industries Plant is now out. The cause is still under investigation. Amazingly no injuries are reported. The company supplies specialty chemicals to the oil and gas industry.

A bit of better news out of Washington today. The U.S. Navy Yard is now open for business. As you know, it's been closed since Aaron Alexis shot and killed 12 people in building number 197.

Although that's better news, there is still so many unanswered questions. We now know Aaron Alexis' mental health was crumbling, his paranoia making him delusional and even more dangerous. Yet three days after his murderous rampage, investigators still can't say what turned him into a killer. Even his own mother is left with questions.

CNN's Pamela Brown is in Washington with more for you. Good morning, Pamela.

PAMELA BROWN, CNN CORRESPONDENT: Good morning to you, Carol. That's right. You know, as this investigation continues, still no word on a motive. In fact officials are questioning whether we'll ever have a clear-cut answer of what caused Aaron Alexis to go on that deadly shooting rampage.

(BEGIN VIDEOTAPE)

BROWN (voice-over): As investigators sift through the evidence in the Navy Yard killings, Navy officials say damage inside Building 197 is so extensive, it may take weeks to repair and reopen it. One official saying there is blood everywhere. There is damage everywhere.

The mother of the gunman apologizing Wednesday to the families of the victims.

CATHLEEN ALEXIS, AARON ALEXIS' MOTHER: I don't know why he did what he did, and I'll never be able to ask him why. Aaron is now in a place where he can no longer do harm to anyone, and for that I am glad.

To the families of the victims, I am so, so very sorry that this has happened. My heart is broken.

BROWN: Investigators still don't know why. Law enforcement sources say nothing points to a specific motive for the rampage. Even after the seizure of Aaron Alexis' computer and other possessions. And interviews with the social contacts for clues.

Yet odd details are emerging. A federal law enforcement source tells CNN Alexis made unexplained etchings into the shotgun he used in the attack. The etchings read "better off this way" and "my elf weapon."

Investigators don't know what the sayings are supposed to mean, so questions remain about whether the rampage could have been prevented. Navy officials in Rhode Island never passed along police reports about Alexis' erratic behavior claiming he was hearing voices.

CHUCK HAGEL, DEFENSE SECRETARY: Where there are gaps, we will close them. Where there are inadequacies, we will address them. And where there are failures, we will correct them. We owe the victims, their families, and all our people nothing less.

BROWN: New details have emerged suggesting authorities might have been able to contain the gunman more quickly. A government official tells CNN when the first radio call came in about a shooting at the Navy Yard, highly trained tactical Capitol Police officers attempting to help stop the rampage were told by a watch commander to stand down.

The Capitol Police chief has ordered an independent fact review of their response and the critical first moments after the shooting was reported.

(END VIDEOTAPE) BROWN: And we are still awaiting the autopsy results from the medical examiner's office. Meantime this Sunday President Obama is expected to attend a memorial service for the victims from Monday's tragedy -- Carol.

COSTELLO: Pamela Brown reporting live from Washington, D.C., thank you.

Still to come in the NEWSROOM, it's McCain versus Putin. McCain hurling insults and trying to win over the Russian people. But he just might have made one big mistake. We'll be back.

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COSTELLO: Checking our top stories at 17 minutes past the hour.

Police in Georgia are looking for at least two more suspects in the abduction this week of a 14-year-old girl. Two other men have been placed under arrest. Avani Perez is in good health and back at home with her family after she was kidnapped during a home invasion.

Police in Canada have now identified the driver of a double-decker bus that plowed into a moving train. David Woodward was among six people who died in the collision. At least 34 others on the bus were hurt. It's still not clear what led to this crash, including whether Woodward hit the brakes.

If the latest iPhone upgrade is not working for you, you just might want to wait. Many iPhone and iPad owners say installation of Apple's new operating system has been extremely slow. It's likely the result of overwhelmed servers. Not only is everyone trying to download the new software all at once, developers are pushing out apps now optimized for the new system.

Someone is waking up $400 million richer this morning. A winning Powerball lottery ticket was sold at this store in Lexington, South Carolina. That's near Columbia. No one has come forward yet with the ticket, but in South Carolina, winners can stay anonymous, so someone might never come forward.

The jackpot was $400 million, but after taxes, that's closer to, what, a $223 million pot. The winning numbers in case you're interested, 7, 10, 22, 32, 35 and the Powerball number was 19.

John McCain is taking aim at the Russian President Vladimir Putin. Putin is actually speaking right now in Valdai, Russia, at a youth forum. This is a live picture of Mr. Putin.

McCain wrote a scathing article about the Russian leader. It was published on a Russian news site called Pravda. And as you might expect, McCain's op-ed is just as critical of the Russian government as Mr. Putin's "New York Times" op-ed was critical of the United States.

McCain's piece is titled "Russians deserve better than Putin." McCain wrote in part, quote, "President Putin and his associates don't respect your dignity or accept your authority over them. They punish dissent and imprison opponents. They rig your elections. They control your media. They harass, threaten and banish organizations that defend your right to self governance.

How has he strengthened Russia's international stature? By allying Russian with some of the world's most offensive and threatening tyrannies, by supporting a Syrian regime that is murdering tens of thousands of its own people to remain in power. He is not enhancing Russia's global reputation, he is destroying it," end quote.

CNN's Phil Black live in Moscow with more on this.

Good morning, Phil.

PHIL BLACK, CNN INTERNATIONAL CORRESPONDENT: Hello, Carol.

Yes, well, the newspaper is famous really around the world. It means truth. But it is famous going back to Soviet times because the "Pravda" newspaper then was the mouthpiece of the communist party during the Soviet Union. The "Pravda" of today it is a little bit different. It is a tabloid news Web site that isn't really read by many people. It is certainly not "The New York Times" of Russia. So, in that case it is not an equivalent blow as Vladimir Putin's letter to the American people was as such.

I guess what John McCain is really going for here is the symbolism, both what it means and its place in history. You mentioned that Vladimir Putin is speaking right now. We will be listening to see if he gives any sort of reaction to McCain's criticisms.

But he may not. The event that he's speaking at now is a big picture event talking about the future of Russia, its place in the world and that sort of thing. He may be unwilling to lower the tone.

But it's certainly not the first time these two men have exchanged barbs pretty directly -- Carol.

COSTELLO: So if not many people read "Pravda" in Russia, why would he comment?

BLACK: Well, I think it's going back to that historic tide. It is a title that is famous around the world and he joked at the time that Vladimir Putin wrote his piece that he would perhaps do that in return in "Pravda". It appears that maybe he hasn't fully researched just what the status of this particular media site or news publication is right now.

But he's clearly trying to reach the American -- sorry, the Russian people in the same way that Vladimir Putin was trying to reach the American people when he wrote in "The New York Times." Will it work? Well, there's a general rule here that Russians don't like being told what to do by non-Russians and this is something that politicians play up to here a bit and usually use that rule to dismiss outside criticism.

They usually dismiss it as interfering, meddling, arrogance, that's sort of thing, and, indeed, that's the way they have treated John McCain in the past. He is a frequent critic of Russia. And in the past, I can remember an occasion with Vladimir Putin when he was asked about criticisms from John McCain and he replied, essentially saying that McCain is crazy because of his time as a prisoner of war during the Vietnam.

So, the relations between these two men, the feelings, they go back a fair way and they're not likely to change too much as a result of John McCain's article here.

COSTELLO: It's funny. I think Americans feel pretty much the same way about Vladimir Putin.

But I want to read a bit more from McCain's editorial. He also writes on "Pravda" and this is for the Russian people, I do believe in you. I believe in your capacity for self government and your desire for justice and opportunity. I believe in the greatness of the Russian people. When I criticize your government, it is not because I'm anti- Russian, it's because I believe you deserve a government that believes in you and answers to you.

But in light of what you just said, Phil, this probably won't resonate with Russians living in Russia. They resonate with Russians living here in the United States, right?

BLACK: Yes. I mean I'm sure that some people here will sympathize and absolutely agree with much of McCain's argument. There is a growing opposition movement to Putin's rule in this country. But for all the growth that it has seen in recent years, it is still a very distinct minority. Something that only exists in the bigger cities here in Moscow and maybe St. Petersburg.

Across this vast country, people tend to see the world the Vladimir Putin way, I guess, and as I said, they don't like being told what to do, particularly by Americans. They're still very much a Cold War hangover there, where a lot of Russians still view America as the great adversary to Russia, as an international force that is in some way dedicated to weakening or harming Russia. And again, these are all things that politicians here tend to play with quite successfully, Carol.

COSTELLO: Phil Black, reporting live from Moscow this morning -- thanks.

Still to come in the newsroom, battles over Obamacare setting the stage for a possible government shutdown, but not everyone thinks bringing the government to a screeching halt is a good idea. We'll talk to one of those lawmakers next.

(COMMERCIAL BREAK)

COSTELLO: Checking our top stories at 27 minutes past the hour.

A man fatally shoots two women inside a home near Miami and then takes police on a frightening high-speed chase that ends in this horrific crash. CNN affiliate WSVN reports the other driver was killed. After the wreck police found the suspect dead from a self-inflicted bullet wound.

A theft from a gun maker outside Los Angeles leads authorities to a man they say was posing as a cop. A search of Jeffrey Edmonds house turned up illegal assault weapons, bullet proof vests, ballistic helmets, grenades and gas masks, and a counterfeit LAPD badge and ID. Edmonds is now being held on $250,000 bail.

New this morning, JPMorgan chase has agreed to pay about $920 million in penalties in the so-called "London Whale" case. The charges are the bank had inadequate risk controls in place. A team of traders made a risky bet last year, which led to $6 billion in losses.

Technically, fall does not start until Sunday but it's already looking like winter in Montana. Look at that. This is the season's first snow. It's just fallen at Big Sky Resort. Icy conditions prompted officials in Montana and Wyoming to shut down a handful of roads in Yellowstone National Park. It looks beautiful, though, doesn't it?

We're back in a minute.

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