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Lawmakers Announce Bipartisan Framework to Avoid Shutdown; Club Q Survivors Testify on Rise of Violence Against LGBTQ-Plus People; Today, Federal Reserve Announcement on Interest Rates. Aired 10-10:30a ET

Aired December 14, 2022 - 10:00   ET

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

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[10:00:00]

ERICA HILL, CNN ANCHOR: A good Wednesday morning. Top of the hour here. I'm Erica Hill.

JIM SCIUTTO, CNN ANCHOR: And I'm Jim Scuitto.

We are following several major stories this hour. First, on Capitol Hill, some good news, congressional negotiators announced overnight that they have secured a bipartisan agreement on a framework not just for a week to fund the government, but a full year of funding package. The threat of a shutdown thankfully appears to be over. The next few days though could get messy as lawmakers work to turn that framework into a reality, into legislation. We're going to be live from Capitol Hill.

HILL: Also ahead, the Federal Reserve expected to raise interest rates for the seventh time this year. With inflation, though, just how much could they dial back on that rate hike?

And with a controversial COVID-era border policy known as Title 42 set to end next week, the Biden administration now making moves to prepare for an unprecedented surge of migrants. We have more on that ahead as well.

SCIUTTO: Let's begin with CNN Chief Congressional Correspondent Manu Raju on Capitol Hill. And, Manu, I just feel at moments like this, we talk a lot about stalling and gridlock on Capitol Hill, rightfully so, because we see it even with simple stuff, like funding the government.

Just yesterday, there were worries about they may not fund for a week. Now, they are going to do it for a year, at least the framework to year. How close are they to a deal here?

MANU RAJU, CNN CHIEF CONGRESSIONAL CORRESPONDENT: Yes. This is the big question, because they did announce a framework agreement between the three of the four key appropriators. Those are the members of Congress in the House and Senate who actually draft legislation to fund the federal government. But we have seen no details about this and they are still going to haggle over the details from the days ahead. And that's going to be the big question, what ultimately is in this package, which could cost about $1.7 trillion or so to fund the federal government.

And, remember, this was supposed to be done in September 30th, then they punted the deadline until this Friday. They are not going to get an agreement by this Friday, so they're planning to pass a one-week stop gap measure to fund the government for an additional week to finish the negotiations on this larger package.

Now, there is one key group that is missing from endorsing this package. That is House Republicans, who are now not signing on to this amid opposition from the top Republican leader, Kevin McCarthy, who, of course, is battling for the votes to become speaker, and has been courting the right-wing of his conference, which is steadfastly opposed to this measure.

Now, as this has been development, there has been tension growing behind the scenes between Senate Republicans and House Republicans on this issue, including Senate Republican Leader Mitch McConnell, who supports this deal, suggesting yesterday it would have broad agreement that whether it ultimately comes together.

But still also underscores the growing divide between these two men who, over the past year, have split on some key issues, not just on spending but on Ukraine, on guns, on infrastructure, as they too, both men, dealing with different realities in their respective chambers, dealing with different conferences and are headed into a new power dynamic next year when Republicans will control the House. Republicans will still in the minority in the Senate but that is the argument Republicans are making in the House.

They want to punt this into next year so they believe they would have a firmer hand to deal with it next year. But Senate Republicans simply do not agree, they want to get this done right now. Because they're concerned, guys, if this goes into next year, only intensify concerns about a potential government shutdown.

SCIUTTO: That was interesting. You mentioned that battle, and McConnell has won those, mostly, right, on bipartisan gun reform and this one. We'll see how that dynamic changes with the Republican majority in the House. Manu Raju, thanks so much.

HILL: Joining us now to discuss, CNN Chief Political Correspondent, Anchor of State of the Union Dana Bash and Political Anchor for Spectrum News Errol Louis. Good to see you both this morning.

Picking up -- let's pick up where Manu left off there. There's not only this battle between Mitch McConnell and Kevin McCarthy, but as we look at how all of this is playing out, and Kevin McCarthy earlier in the day telling members in a closed door meeting he's a hell no on the omnibus spending package, is this really the way that Republicans want to start things in January, Dana? Go ahead.

DANA BASH, CNN CHIEF POLITICAL CORRESPONDENT: Okay. I wasn't sure where you wanted to go first, but I'll take it, because I have a definite -- I definitely wouldn't call it point of view, but my sense from my reporting is that the answer is, yes, because the most important thing for Kevin McCarthy, Erica, is becoming speaker.

[10:05:05]

And he is not going to become speaker if right now, at the 11th hour, he angers some members of his very, very small and narrow incoming majority. And by supporting a spending bill that he doesn't -- or any spending bill, frankly, at this point, that would last for an entire year would be a death knell, a political death knell for him.

So, he has no choice. Whether or not he thinks that this is a good idea, and if he does become speaker, kind of a wink and a nod, okay, I'll take it, we don't know for sure. But when it comes to what he's telling his caucus, telling Republican members, hell no is pretty much the only thing politically he can saying if he wants any chance of getting those 218 votes to become speaker.

SCIUTTO: Errol, he doesn't have those 218 yet. Will he get them? And if he does, how powerful a speaker would McCarthy be given the concessions he's being forced to make?

ERROL LOUIS, CNN POLITICAL ANALYST: Well, that's the whole question, Jim. Whether or not he becomes speaker is going to be determined in the next few weeks. And it is a negotiation over lots and lots of different issues. One of the things -- one of the key issues are the rules by which he would be the speaker.

And so you have members of the Freedom Caucus, the conservative faction that is trying to make sure they extract something out of him, and the thing that they want is the ability to basically yank him at any time in the middle of his speakership, if that should come about. That's how he toppled John Boehner a generation again. I mean, it is entirely possible that they could get that.

And that's the negotiation to keep an eye on. If it is such a tenuous speakership that he can be recalled or removed at any point by an organized faction of the Republican conference, it won't be a very powerful speakership at all. And so he's in a very difficult position.

There are a lot of conservatives who want him to say, hell no, that they want him to -- if he is going to be the opposition speaker, to damn well act like it and just oppose almost anything that comes out of the White House or out of the Democratic side of the House. It's a very tough positions that he finds himself in.

BASH: Can I just add one thing? Just because when it comes to the potential for this to pass, just because Kevin McCarthy is saying hell no doesn't mean that it's doomed. Because, remember, we're talking about votes based on the current Congress, which is run by Democrats in the House.

HILL: Yes, it's an important point, and I'm glad you made it as well.

And let's look at -- so, January 6th, we've learned there's going to be a final hearing next week. Bennie Thompson says the panel is looking at five to six categories of referrals, which will be announced at that public hearing, one of them being ethics referrals to the House Ethics Committee. Dana, what are you expecting out of that?

BASH: Look, there are several members of the House, sitting members of the House. Scott Perry is the first that comes to mind, given the news that CNN broke last night about the Justice Department looking at his text messages, who have defied their colleagues in the subpoenas that they have gotten, and they have just kind of blown them off. And so one of the questions is whether or not the committee that was blown off will refer these members to the Ethics Committee.

What is interesting, because, again, we are on the cusp of a new Congress, in the new Congress, the January 6th committee won't exist, because there's no way Republicans will keep that committee because it is a select committee. The ethics committee is different. It is an evenly split committee. And my understanding, in talking to a former member of that committee last night, is that just because there is a new Congress doesn't mean a referral will die. It will carry over until and through into the next Congress.

HILL: Interesting to see. Dana, Errol, we have to leave it there. Good to see you both this morning. Thank you.

SCIUTTO: Well, in just about two hours, the man accused of attacking Nancy Pelosi's husband in his home with a hammer, will appear in a San Francisco courtroom. David DePape is set to face local charges there. He's already pleaded not guilty to a slew of state charges, including assault, attempted murder and attempted kidnapping.

According to court documents, DePape broke into the couple's home in October, was searching for the House speaker actually. Following the attack instead on her husband, 82-year-old Paul Pelosi had surgery to repair a fracture to his skull as well as injuries to his right arm and hands.

HILL: Any moment now, survivors of the mass shooting at Club Q in Colorado Springs are set to testify on Capitol Hill about threat to the LGBTQ community. A gunman, you may recall, killed five, injured many more inside the club, which had been a safe space for so many.

[10:10:00]

SCIUTTO: Some of the survivors of that shooting, they were invited to the White House yesterday, as President Biden signed the Respect for Marriage Act into law. That landmark legislation provides new federal protections for both same-sex and interracial marriages.

Our colleague, Don Lemon, co-anchor of CNN This Morning, was at the White House event, spoke to the owner of Club Q, as well as some of the survivors. And I wonder what they said to you.

DON LEMON, CNN ANCHOR: Quite frankly -- good morning to both of you, by the way. Good to see you. Quite frankly, they are excited about testifying. They know that they lived through a horrific ordeal. They were happy that they were invited to the White House for the codification of same-sex marriage and also to acknowledge the same thing when it comes to interracial marriage. Three weeks ago, they said they could not have imagined that they would be in this position, having lived through such trauma and then being invited to the White House to see the president of the United States do this, and, again, looking forward to speaking to Congress today. But their lives have changed. The survivor, an owner and bartender all spoke with me, standing in front of the White House.

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JAMES SLAUGH, CLUB Q SURVIVOR: I'm doing better, relatively speaking. I mean, I know we did an interview back when I was in the hospital, a bullet in my arm, a shattered humerus, the rod through my arm, that surgery. Luckily I have a lot of mobility. It's coming back. I still have to go through P.T. most likely, but better relatively. And seeing all of this, this is it. This is, like they said, inspiring. That's the best way to put it.

LEMON: As a club owner, did you ever think in a million years that obviously that this would happen? You have spoken about that.

MATTHEW HAYNES, FOUNDING OWNER, CLUB Q: Yes. I can go further back. As a gay male coming out and struggling when I was coming out, never would I imagine I would be here at the White House actually seeing that our right to marry is now protected by federal law. And then, of course, then you throw in our little club in Colorado Springs that never did we think it would have a voice, and, of course, for all the wrong reasons is why we're here, is because we were attacked and our community was invaded.

But, again, this is -- we use the word inspiring. This has been inspiring and it gives you hope and it's actually probably the most uplifting thing certainly that I would say that all three of us have experienced since the incident happened at Club Q.

SLAUGH: Bullets will not stop our community and the majority of the community around us, our allies. And we're going to prevail. Love wins.

(END VIDEOTAPE)

LEMON: Obviously, it's awful. They are recovering from what happened, a very tragic situation, but they're excited about the opportunity to be able to get in front of lawmakers and the American people and try to correct the wrong.

HILL: So, in terms of -- Don, in terms of correcting those wrongs, as you point out, what is there? Look, it's so important on the one hand that we're even having these hearings, right, long overdue in many ways. What is their broader message and what do they hope to really convey to lawmakers to get them to listen to?

LEMON: To stop the rhetoric, to stop the hate, online and even from the lawmakers in ads going back to their constituents, using it to fundraise. Because they feel that it ultimately leads to what happened at Club Q. And they feel more people will die or get injured because of -- in many ways, lawmakers' actions who don't understand the LGBTQ community, and sort of cast them aside and use them -- use members of the LGBTQ community -- I should say, us, because I'm one of them -- as political pawns. And that's what they want to get across.

HILL: As political pawns, they try to stoke fear oftentimes, in a way and in situations where there's no need for fear. There is only need for passion and discussion and understanding. That's really important. I'm glad you spoke with them.

LEMON: Thank you. It's good to see you.

HILL: Don, thanks. Good to you see you, my friend.

LEMON: Good to see you as well, Jim. Thanks for having me on the show.

SCIUTTO: Good to see you, Don, always good to have you on. Thanks so much and at a very important moment for this country.

Still to come this hour, today, the Federal Reserve will announce its decision on interest rates. Really, the question is how much. Also, what will it mean for your finances?

HILL: Plus, the Biden administration bracing now for a growing number of migrants to enter the U.S. as a pandemic-era policy comes to an end. We are live in El Paso, a border city where one official warns is not prepared.

SCIUTTO: Coming up later, do you use TikTok? Because there are privacy and national security concerns that are now pushing lawmakers working on a crackdown on that social media app. We're going to ask an expert about -- what the risks are. That's coming up.

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[10:15:00]

HILL: It is decision day for the Fed as wraps up their two-day policy meeting and prepares to announce another rate hike this afternoon. This hike though could be different from the last few increases we've seen.

CNN Economics and Political Commentator Catherine Rampell joining us now with more. So, a hike is expected here, but we're told it's likely going to be a half a percentage point as opposed to the three quarters that we have been seeing. Rate hikes typically take, as I understand it, about six months to really show that they're starting to have an impact. So, the first big increase of three quarters of a percent was in June. Do we know if this slight dip we've seen inflation is a direct result of that one?

CATHERINE RAMPELL, CNN ECONOMICS AND POLITICAL COMMENTATOR: Well, there's this line about how monetary policy has long and variable lags, which is the bane of the Fed's existence, that they don't actually know when they will finally see the full impact of the decisions that they have already made.

[10:20:10]

So, it could be six months, it could three months, it could be a year, we don't know.

What the Fed is worried about, of course, is that inflation has persisted for much longer than had been predicted. They don't want it to become entrenched that basically people start to expect more inflation, and so, therefore, it becomes a self-fulfilling prophecy. They preemptively raised their prices or asked for more higher wages, et cetera. We don't see signs of that happening, fortunately.

And the recent data that have come in have indicated that inflation does seem to be moderating, which is why I think the Fed is probably more comfortable with a slightly smaller rate hike today. That doesn't mean, however, that they're going to stop keeping their foot on the brakes. It doesn't mean that they're going to stop raising interest rates, it just that they probably won't have to do it quite as aggressively as they might have otherwise.

HILL: So, assuming we have a little bit more breathing room, but not so much, as you point out, that we have to worry about other things.

When we look at housing, I have been fascinated watching the housing market over the last couple years. The Fed rate hikes have had, understandably, a major impact on people's mortgages, what they pay every month. But when we look at the housing market, the speed with which it feels, homes have become expensive both to buy and to rent. Have we seen a tangible impact at this point on prices, on the housing market that we can tie back to these rate hikes?

RAMPELL: Absolutely. Look, remember, that over the past couple of years, housing prices have gone way up. And that's a combination of a few different factors. One, of course, is the pandemic shifting people's preferences for where they want to live, how they want to live, how much space they want. Rates were very low, interest rates were very low for a long time. And, of course, you have the aging of the millennial generation into their prime child-bearing and home- buying years. All of that has put upward pressure on prices.

Then we've had the Fed raise rates. We've had rates go -- the 30-year mortgage goes from around 3 percent to over 6 percent. And so the monthly cost of paying down a mortgage has gone way up. And you've seen some impact on prices so far, but not nearly enough to offset those much higher borrowing costs.

As a result, if you talk to economists, if you talk to housing analysts, a lot of them think that housing prices still have much further to go down in the year ahead, particularly since it looks like, as we've been discussing, those interest rates are going to stay high. And as long as those interest rates are going to stay high and people can't afford to buy homes, those prices are going to have to come down a little bit.

HILL: Yes. You and I have talked so much over the last couple of years about this economy that we're all living in, and there's really no handbook for it. And a lot of the traditional models or things that would be followed, they just -- everybody is throwing that out the window.

So, I'm curious. As you're looking at where we're at, what are you watching these days to give you a sense of the economy and how things are really doing?

RAMPELL: It's very consuming. Frankly, it is very confusing to get a handle on where things are headed in part because so many different economic numbers are pointing in different directions. If you look at the job market, the job market still looks very strong. Unemployment rates are close to record lows. It's still quite easy to get a job. There are a lot of job vacancies out there. On the other hand, there's a lot of concern about an impending recession, in part because the Fed has been tightening financial conditions.

And there are some of these other puzzles that are out there, like why are there still so few people participating in the labor force given that there are so many jobs available. Is it because more people retired? Is it because we have fewer immigrants? There were a couple of years when there was very low immigration is because of persistent child care issues.

So, it's really hard to make sense of the overall picture. Of course, like everyone else, I'm paying attention to prices, I'm paying attention to the job market and I'm paying attention to some of these squishier measures, consumer sentiment, to see how people feel and what that indicates how they might behave in the months ahead.

HILL: The feeling is such a big part of it, especially when you have a economy that depends on consumer spending, as we know. Catherine Rampell, I always appreciate it. Thank you.

RAMPELL: Thank you.

SCIUTTO: Well, the Biden administration is now sending more agents to El Paso, as a growing number of migrants cross through that city into the U.S. from Mexico. One concern, housing, all of those who need shelter.

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UNIDENTIFIED FEMALE: Title 42 is going to make that situation worse, where they're going to have more apprehensions. And so we're going to see a lot more released into the community, and we're not prepared for it.

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[10:25:00]

HILL: The Department of Homeland Security is deploying additional agents to the U.S.-Mexico border in Texas, DHS is preparing for an expected 9,000 to 14,000 migrants a day. That would more than double the current number of people crossing the border. And it's a move that comes as a COVID-era border policy, which was established under former President Trump and extended under President Biden, is set to end.

SCIUTTO: CNN Senior National Correspondent Ed Lavandera is in El Paso, Texas, one of the cities seeing an influx now.

[10:30:00]

You've been covering this border for years and you've been covering these surges for year. So, here comes another one. I wonder, what preparations do you see?