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Military Families Denied Death Benefits; Markets up on Expected Fed Chief Nomination; Kanye and Kimmel To Face Off Tonight; We're Ready to Negotiate; Former Pledge Defends "Rapebait" E-Mail

Aired October 09, 2013 - 09:30   ET

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

CAROL COSTELLO, CNN ANCHOR: Good morning. I'm Carol Costello. Thank you so much for joining me.

Later this morning, Dover Air Force Base will pause to honor troops killed in Afghanistan as their remains are returned to the United States. Among those paying tribute, Defense Secretary Chuck Hagel. While Hagel will be there, some of the families of the fallen will not. And it's all because of that partial government shutdown. Pentagon correspondent Barbara Starr has more for you.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): For these troops just killed if Afghanistan, their families are being denied government death benefits until the shutdown is over.

SEN. HARRY REID (D), SENATE MAJORITY LEADER: That America could fail the families of our fallen heroes. Appalling. Frightening.

SEN. JOHN MCCAIN (R), ARIZONA: Shouldn't we be embarrassed about this? Shouldn't we be ashamed?

STARR: Marine Lance Corporal Jeremiah Michael Collins' (ph) remains were brought Monday to Dover Air Force Base.

UNIDENTIFIED FEMALE: He became a Marine to become somebody. And he became a great Marine.

STARR: But his family and others will not get Pentagon funding to go to Dover to meet their loved ones. The program is frozen until the shutdown is over. Funeral and burial expenses won't be reimbursed. A $100,000 cash payment to survivors, stopped. Ami Neiberger-Miller works with grieving families. There is concern for those that don't have a lot of money.

AMI NEIBERGER-MILLER, T.A.P.S.: The benefits are especially critical because they do provide them with the ability to make decisions quickly.

STARR: Her 22-year-old brother Christopher was killed in Iraq in 2007.

NEIBERGER-MILLER: There were a number of unexpected expenses that we had not anticipated in our lives because we certainly had never thought my brother would die. STARR: Some Republicans say the Pentagon already has the authority to pay the benefits, but promise a quick piece of legislation to make sure that happens.

STARR (on camera): Pentagon officials are adamant they need the legislative fix to get the money flowing again. And they say the proof is that Congress is talking about a fix. That proves they need a legislative solution.

But in the meantime, a number of corporations and groups that support military families have quietly stepped forward and are offering their financial support to families in their time of grief.

Barbara Starr, CNN, the Pentagon.

(END VIDEOTAPE)

COSTELLO: And a little later on in the NEWSROOM we'll talk to one of those private individuals who are stepping forward to help military families. That comes your way in the next hour of NEWSROOM.

Let's talk about Wall Street now. You see the market's up eight points. Whoohoo. Wall Street opening higher this morning. Markets getting a lift on news President Obama will nominate Janet Yellen to replace the Fed chief Ben Bernanke. Alison Kosik is live at the New York Stock Exchange.

Good morning, Alison.

ALISON KOSIK, CNN CORRESPONDENT: Hey, eight points better than no points in the green. I had to do a double take seeing even green on the screen. You know, you can thank Janet Yellen for the green that you're seeing this morning. One trader telling me, you know, as Wall Street sees it, it's good to have some certainty as to who may lead the Fed. That is better to have somebody that they know than to have somebody unknown thrown in.

So you're looking at a bit of a u-turn for stocks after it's been sort of a down trend for the Dow. It's actually been down 11 of the past 14 sessions. It's off more than 350 points since the government shutdown started and since those debt ceiling fears began flaring up.

So as far as Janet Yellen goes, the thinking is, her possible appointment would kind of mean more of the same. That the Fed is going to keep jacking up the economy with the stimulus money that's been pouring into the financial system. $3 trillion being poured in since 2008.

It's also been a huge concern lately. The Fed has said it may start pulling that money out with the belief that the economy is healthy enough to handle it, though not everybody is sure. Once again, with Yellen though, the thinking that it's going to be more of the same because her views are close to Bernanke's. So investors are betting she won't be in any rush to end the stimulus.

Carol. COSTELLO: And the president is expected to officially nominate her at 3:00 p.m. Eastern this afternoon. Wolf Blitzer will have a special report then and we'll learn a lot more about Janet Yellen.

Thanks so much, Alison Kosik.

KOSIK: Yes, you will.

COSTELLO: Still to come in the NEWSROOM, they've been feuding at a distance for weeks. Now Jimmy Kimmel and Kanye West are set to meet face-to-face. Tonight's late night interview. Will it quell all the conflict or just fan the flames?

(COMMERCIAL BREAK)

COSTELLO: The epic battle between Kanye West and Jimmy Kimmel may finally be coming to a head. The hip-hop superstar and the late night comedian have been sparring for weeks now by phone, via Twitter and on television. Now a rep confirms that Kanye will indeed be a guest tonight on ABC's "Jimmy Kimmel Live." "Showbiz Tonight" anchor A.J. Hammer joins me from New York.

Man, I hope they have a cage fight.

A.J. HAMMER, ANCHOR, "SHOWBIZ TONIGHT": Yes, Carol, it's hard for me to imagine Jimmy Kimmel, one of the nicest guys in all of TV and showbiz, having an epic battle with anybody, so you certainly wouldn't think of Kanye and Jimmy taking each other on. And it actually, this whole thing, is certainly something that caught Jimmy Kimmel by surprise a couple of weeks ago when it started. Kanye was apparently very upset with Kimmel over a skit that they did and Kimmel reacted to this on the show. Watch this.

(BEGIN VIDEO CLIP)

JIMMY KIMMEL, HOST, "JIMMY KIMMEL LIVE": Did anyone else get a very angry phone call from Kanye West about an hour and a half ago? Just me? OK, I didn't know if he was mad at all of us.

(END VIDEO CLIP)

HAMMER: So what happened was the Kimmel show took a real interview that Kanye had given to the BBC and had two children read it verbatim. That's hilarious, right? But this infuriated Kanye. He did try to resolve his feeling, like most people might, by calling up Kimmel, Carol. No, he let loose with a string of very angry Twitter blasts. Kanye took a bunch of really personal shots at Kimmel. Jimmy reacted to that on his show and, unfortunately, I can't share most of that with you because of the profanity mixed in. But just watch it. You don't even need to hear what they're saying. It's very funny.

And unless you think it's a publicity stunt. I don't think that's the case. A lot of people might be speculating that because, of course, Kimmel was behind that infamous twerking girl on fire prank. That got him a lot of press. But Kimmel denies this was a stunt. And, Carol, this appearance was only announced yesterday, so it's not like they're milking it and there was a lot of buildup for it. I'm actually really eager to see what happens when these two go head-to-head (ph).

COSTELLO: I'm going to set my DVD, are you kidding?

HAMMER: Set your DVD. Good luck with that. If you set your DVR you might -

COSTELLO: Yes, exactly. Oh, DVR. I'm sorry. Oh, I'm so mortified now but I've been mortified before. I can take it.

HAMMER: All right.

COSTELLO: A.J. Hammer, thank you so much.

HAMMER: You got it.

COSTELLO: Here's what's all new in the next hour of NEWSROOM. A high school Spanish teacher under fire for her "Playboy" past.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I'm going to be a Spanish teacher.

(END VIDEO CLIP)

COSTELLO: It's not illegal, but some parents say it sets the wrong example.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Can you be an effective teacher when a classroom full of high school boys, they're envisioning you naked?

(END VIDEO CLIP)

COSTELLO: Plus, the controversy behind Cross Fit. It's one of the most popular workout trends in the country. It has a reputation for being intense and very invective. But is it also dangerous? That's all new in the next hour of CNN NEWSROOM.

(COMMERCIAL BREAK)

COSTELLO: This morning the Internet is all abuzz over an op-ed written by Paul Ryan the fiscal darling of the Republican Party and one half of the GOP's last presidential ticket. Well in today's "Wall Street Journal", he calls for an end to the stalemate in Washington but does not address the Republican signature goal, the killing of Obamacare.

For some specifics on what Paul Ryan wrote, quote, "We need to open the federal government. We need to pay our bills today and make sure we can pay our bills tomorrow. So let's negotiate an agreement to make modest reforms to entitlement programs and the tax code."

Now the backlash. Dan Holler of the conservative group Heritage Action tweeted quote, "Much like White House press, Paul Ryan doesn't mention Obamacare in "Wall Street Journal" op-ed." And conservative activist Erik Erickson re-tweeted this quote, "It seems like Paul Ryan has successfully -- well we'll say angered the right."

Joining me now, CNN political analyst and executive editor for the "Daily Beast", John Avlon. Good morning, John.

JOHN AVLON, CNN POLITICAL ANALYST: Good morning, Carol.

COSTELLO: So first of all, let's tackle conservatives' concerns. Why do you suppose Paul Ryan didn't mention Obamacare in his op-ed? And I read it. It's nowhere in here.

AVLON: Yes. I think he realizes it's functionally a nonstarter with the President which, you know, should have been obvious like a year ago or right after the election at least.

Look, what Paul Ryan is doing, however, really deserves applause because he's putting forward a path forward, something that a real conversation can be about. Areas of surprising agreement that could actually help us take this whole shutdown and the debt ceiling debacle and turn it to something constructive for the country.

So, props to Paul Ryan for actually putting forward a plan. And if he angers the far-right, well sometimes that's a sign you're doing something right.

COSTELLO: Well and he doesn't -- exactly give the President a pass. I mean the first line of his op-ed is "The President is giving Congress the silent treatment. He's refusing to talk even though the federal government is about to hit the debt ceiling."

AVLON: Yes.

COSTELLO: And he does suggest some things that Republicans and Democrats might agree on. He says why not sit down and talk about modest reforms to Medicare, the tax code? Why not cut, you know --

AVLON: Yes.

COSTELLO: -- cut discretionary spending a bit and let's try to balance this. Let's come up with a budget and actually pass one.

AVLON: Absolutely right. I mean look and I think Paul Ryan and maybe even Speaker Boehner are nostalgic for the outlines of the grand bargain that were being discussed in 2011 that ultimately they walked away from where the President was putting forward concessions.

I mean look there is some common ground to be built upon. The President has put forward in his budget some entitlement reform. You notice chain CPI that's something to work with. There is broad agreement on tax reform.

But I do think you know Ryan needs to own a bit of difficulty here. One of the reasons we haven't had the kind of grand bargains that he waxes nostalgic about recently is because he vote the against the Bowles-Simpson commission that he was part of.

One of the reasons we're at this mess with a shutdown, government shutdown is because of Ryan's budget in the House that is so far apart from what the Democrats passed in the senate that it's difficult to find that common ground.

So let's praise him for putting forward a path and realize there is some common ground to be built upon, if cooler heads prevailed but let's not ignore the past and how we got here. And partly, Ryan bears some share of the blame.

COSTELLO: Well I did find it interesting he chose to write an op-ed and he chose not to do any sort of television interview or radio interview and actually, you know, saying these things. He's sort of have been absent from this debate.

AVLON: He has been. And frankly a lot of responsible Republican voices have been absent. I mean there has been the persistent sense that the inmates have been running the asylum. And a lot of responsible Republicans are afraid of anchoring the far-right at this moment of high emotion.

But now is really where the rubber meets the road. We're a week away and change from the debt ceiling. This makes -- this ratchets up the pressure enormously for cooler heads to prevail. So it really is up to some of these folks to get up off the sidelines to get in the game, to start offering some constructive alternatives to default and to this shutdown.

And one of the things even Ryan does in this op-ed that I'm sure angers a lot of folks on the far-right as well, is saying look the sequester was stupid. Let's maybe go back and look at more targeted cuts. That is hopeful. There is common ground to be found in Washington but responsible voices need to grow a spine, step up and start putting forward ideas. And that's why this is a breath of fresh air.

COSTELLO: John Avlon, thanks for your insight this morning. Appreciate it.

AVLON: Thank you Carol.

COSTELLO: Checking our "Top Stories" -- checking our "Top Stories" at 50 minutes past.

Some people are defending the Georgia Tech fraternity member that sent out an e-mail titled "Luring your rape bait". A former pledge from Phi Kappa Tau says, "It's just a joke. It was blown out of proportion."

(BEGIN VIDEO CLIP)

JAKE BAKER, FORMER PHI KAPPA TAU PLEDGE: There is a few pledges that aren't super good with girls and it was basically just sort of getting on them. And it was just like a brotherly like big brother, little brother kind of thing. UNIDENTIFIED MALE: It's a joke.

BAKER: It was a joke.

(END VIDEO CLIP)

COSTELLO: The e-mail gave advice on how to hook-up with the girls like this. Quote, "Always use your hands or arms to guide their dancing in order to maximize your pleasure. And always start with the making out, no raping." Georgia Tech and Phi Kappa Tau national offices are now investigating.

Boston school buses rolling again, at least for this morning. Drivers went on a wildcat strike Tuesday forcing parents to look for alternative ways to get their kids to school. Reports say drivers plan to meet with the bus company today. No word yet on whether those buses will make their afternoon runs. Drivers oppose a new GPS system that allows parents to track buses online.

Eminem's daughter Hailie she was crowned homecoming queen over the weekend and her dad had to watch from inside the school because Eminem didn't want to cause a scene. One parent said the 40-year-old rapper just wanted his daughter to have her shining moment. She's 17 and she goes to school in Michigan.

Still to come in the NEWSROOM the Tigers stay alive, they didn't gave me a heart attack man. A come from behind win forces a deciding game five in the AL Division series. And yes, yes congratulations Boston fans.

We'll be right back.

(COMMERCIAL BREAK)

COSTELLO: Red Sox nation rejoicing this morning because their team is heading back to the American League Championship Series. Andy Scholes is here with "Bleacher Report".

ANDY SCHOLES, BLEACHER REPORT: Yes happy times in Boston right now, Carol. And what a difference a year makes. Last year, the Red Sox finished last in their division. This year, best record in baseball, right. And now they're headed back to the American League Championship Series for the first time in five years.

Last night against the Rays, Boston scratched out three runs in the final three innings to get the win. They take the series, 3-1. The Red Sox will now wait for the winner of the Tigers-A's series in Detroit trying to stay alive with the win last night. And there was a little controversy in the seventh inning -- Carol.

Tigers down 4-3 Victor Martinez this ball is deep right two fans go after the ball off the fence. Take another look. Josh Redding going up for the ball. And they grab it before he's able to make a play. What do you think?

COSTELLO: I think that they ruled that that guy couldn't catch it and it's a home run.

SCHOLES: Well that's what the umpire said. They reviewed it, called it a home run. Tigers go on to win the game, 8-6. Decisive game five will be tomorrow night.

Tonight on CBS, the Cardinals and Pirates will play winner-take-all game five in their series. First pitch set for 8:00 Eastern. The winner plays the Dodgers in the NLCS.

All right. Number one in the line-up section on BleacherReport.com today see Texans quarterback Matt Schaub. Why? Some angry fans went to his house in Houston to yell at him about his poor play. Schaub had to call the police. The fans left on their own before the police arrived. Now Schaub has fallen out of grace with Texan fans after throwing an interception that has been returned for a touch down in four straight games. That's an NFL record and that's definitely a record you don't want to have. But still -- don't go to his house. Stay classy Texan fans.

All right. A team in even in worse shape than the Texans the New York Giants. They're 0-5 after their worst start in 34 years. A popular gentleman's club in Manhattan has a new policy -- G-strings, yes; G- men, no. Rick Cabaret (ph) says it will no longer be showing Giants games on TV because patrons at the club, they've become depressed, they've become upset while watching them lose. And Carol, get this, the dancers have actually been complaining because the boos are distracting.

COSTELLO: Well now I totally understand.

SCHOLES: You want to keep that positive atmosphere I guess. That's what I've heard.

COSTELLO: Exactly. I can't even comment anymore on that because it's all so bad.

Andy thanks so much.

The next hour of CNN NEWSROOM after a break.

(COMMERCIAL BREAK)

COSTELLO: Good morning. Thank you so much for being with me. I'm Carol Costello.

It is day nine of the partial government shutdown. And in Washington, the posturing of politics may have met its match -- the power of shame.

Later this hour, the remains of U.S. troops killed in Afghanistan will be returned to Dover Air Force Base. With Defense Secretary Chuck Hagel on hand the ceremony comes amid a final indignity. The families of those fallen service members are being denied the financial help they were promised all because of that partial government shutdown.

Among some lawmakers, the disgust over the stalemate is almost unbearable.