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House, Senate Strike Deal on Tax Bill; Deputy AG Rosenstein: No Good Cause to Fire Mueller. Aired 6-6:30a ET

Aired December 14, 2017 - 06:00   ET

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

(BEGIN VIDEOTAPE)

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: We want to give you, the American people, a giant tax cut for Christmas.

[05:59:21] UNIDENTIFIED MALE: Negotiators struck a deal about how to reconcile the House and Senate plans.

SEN. CHUCK SCHUMER (D), NEW YORK: The public knows what's going on, and that is tax cuts for the wealthiest.

ROY MOORE (R), LOST ALABAMA SENATE SPECIAL ELECTION: We have not received the final count. Our political process has been affected with baseless and false allegations.

SEN. CHRIS COONS (D), DELAWARE: It certainly shows, though, that the voters of Alabama are taking another look at the Trump administration.

DOUG JONES (D), SENATOR-ELECT, ALABAMA: It was a very gracious call. He congratulated me on the race that we won.

REP. JIM JORDAN (R), OHIO: I think the public trust in this whole thing is gone.

ROD ROSENSTEIN, U.S. DEPUTY ATTORNEY GENERAL: Nobody has indicated to me a desire to remove Robert Mueller.

UNIDENTIFIED MALE: I would hope to think he's safe. If not, all hell will break loose.

(END VIDEOTAPE)

ANNOUNCER: This is NEW DAY with Chris Cuomo and Alisyn Camerota.

ALISYN CAMEROTA, CNN ANCHOR: We want to welcome our viewers in the United States and around the world. This is NEW DAY. It is Thursday, December 14, 6 a.m. here in New York. Here's our starting line.

President Trump's first legislative victory is within reach. Republican leaders in the House and Senate striking a deal on overhaul the nation's tax laws. GOP leaders want to vote next week so the president can sign it into law before Christmas.

At the moment, a majority of economists say the plan overwhelmingly benefits corporations and wealthy Americans over the middle class. And a new poll shows the vast majority of Americans do not support is it. So why are Republicans pushing it through?

And one day after President Trump suffered a political loss in Alabama with Roy Moore's defeat, Roy Moore releases a new video, still refusing to concede.

CHRIS CUOMO, CNN ANCHOR: Deputy Attorney General Rod Rosenstein defended Special Counsel Bob Mueller on Capitol Hill, saying he sees no reason to fire Mueller. This comes as Republican lawmakers are trying to discredit the former FBI director and lifelong GOP member, raising questions about bias in his Russia investigation.

And Senator John McCain hospitalized due to side effects from his brain cancer treatment. Former Vice President Joe Biden, who lost his son to the same deadly disease, was on set with McCain's daughter. And they had some moment that we will show to you.

We have it all covered. Let's begin with CNN's Joe Johns live at the White House. Good morning, Joe.

JOE JOHNS, CNN SENIOR WASHINGTON CORRESPONDENT: Good morning, Chris.

It's beginning to look more and more like congressional Republicans and the president will be able to provide Americans with what has been referred to as a Christmas gift in the form of tax cuts by the end of the year, regardless of whether polls show the taxpayers like it or not. And congressional Republicans will be able to give themselves something to crow about as we enter the race for control of Congress in the midterm elections.

(BEGIN VIDEOTAPE)

TRUMP: We're just days away, I hope. We want to give you, the American people, a giant tax cut for Christmas.

JOHNS (voice-over): President Trump touting a tentative deal on the Republican tax plan after party leaders announced they have reconciled the House and Senate bills, a major step forward.

UNIDENTIFIED MALE: This bill is a bold departure from the broken tax code America has today.

JOHNS: The key points of the compromise bill, as it now stands, reducing the top individual tax rate to 37 percent from 39.6 percent. And lowering the corporate tax rate from 35 percent to 21 percent, a slight uptick from the 20 percent rate originally proposed that was favored by President Trump.

TRUMP: Twenty is my number. So I'm not negotiating that number.

JOHNS: The deal fully repeals the corporate alternative minimum tax but keeps the individual AMT for people making over $500,000 a year and families making at least one million.

President Trump stands to benefit from this change to the AMT to the tune of tens of millions of dollars, according to his only tax return that's public, from 2005. The tax plan would also now allow individuals to write off up to

$10,000 of state and income property taxes or sales taxes or a combination of them, appeasing lawmakers in high-tax states.

Senate negotiators also preserved a number of popular deductions, including the student loan interest deduction, the medical expense deduction, and free graduate-school tuition waivers. The compromise bill would eliminate Obamacare's individual mandate, which requires most people to pay a tax if they do not buy health insurance. The key question: how the resulting revenue shortfall will be paid for.

UNIDENTIFIED FEMALE: I am personally concerned about the U.S. debt situation, taking what is already a significant problem and making it worse, is -- it is of concern to me.

JOHNS: Do all of these changes deliver on President Trump's promise to help the middle class? A new Quinnipiac poll shows that only 26 percent of Americans approve of the Republican tax plan. Despite this, the GOP is flatly rejecting a call from Democrats to delay a vote until newly-elected Alabama Senator Doug Jones is seated next month.

SCHUMER: It would be wrong for Senate Republicans to jam through this tax bill without giving the newly-elected senator from Alabama the opportunity to cast his vote.

JOHNS: The Senate minority leader citing what the president said in 2010 when a final vote on the Affordable Care Act was delayed until newly-elected Republican Senator Scott Brown could be seated.

BARACK OBAMA, FORMER PRESIDENT OF THE UNITED STATES: People in Massachusetts spoke. He's got to be part of that process.

JOHNS: In an interview with CNN, then-businessman Donald Trump praised President Obama for his role in that decision.

TRUMP: He said now, you know, we have to give Massachusetts their vote, which was a very smart thing for him to say.

(END VIDEOTAPE)

[06:05:05] JOHNS: And one more note. If you are a homeowner out there, wondering what's going to happen to the both revered and reviled mortgage interest deduction as it stands now, it will be capped at $750,000.

Chris and Alisyn, back to you.

CAMEROTA: OK, Joe, thank you very much. Let's discuss it. We want to bring in CNN political analyst John Avlon and CNN political commentator Errol Louis. Great to have both of you on set here.

So the tax plan is very interesting to dive into in terms of the details and the opinion of it. So let's do both. OK?

So here's what we know right now. The top individual rate for the wealthiest lowers to 37 percent. The corporate rate goes way down to 21 percent. Those state property taxes, they get complicated. There's a cap on them at some point. But they're not repealing them altogether.

CUOMO: They're not allowing you to claim them as a deduction. This is a big issue, state and local taxes, big in the big states: California, New York. So people write off the taxes that they pay at the state and local level.

CAMEROTA: Right. If you're not allowed to, that's a big--

CUOMO: They're still allowed, but they have reduced the amount that you can write off. But in exchange, they lowered the top tier, believing that the people who will be most hurt by the SALT change are the top tier. So they gave them a little bit more of a tax deduction.

CAMEROTA: Right. Everybody has to get out their calculators right now to figure out if this is a win. But the interesting thing, Errol, is that Americans don't feel as though this is a win. So Republicans are in overdrive, and then the latest polling says that, listen to this. I mean, this is a Quinnipiac poll that the tax plan, a candidate's support for the tax plan will make you less likely to want to vote for them. Forty-three percent gets the highest number there.

ERROL LOUIS, CNN POLITICAL COMMENTATOR: That is correct. There's -- I think the question of the wisdom of crowds, where people sense generally the process, the rushed process, the fact that there have been no hearings. The fact that they haven't waited for any kind of detailed analysis.

The fact that you can't sit with your tax planner and try and figure out what this is going to mean for you suggests that something is happening that is really a little bit untoward. And I think they are probably right.

Whenever you hear the alternative minimum tax, that is code for whatever else you did as far as your deductions, however you structured your life, they're going to lump the number back in and you're going to pay anyway. People understand that. I think with the state and local deductibility, I mean, people sense that the value of your home is going to be repriced. This is going to have real serious implications in New York, New Jersey, California and a couple of other states.

CUOMO: They did keep the mortgage deduction. They changed the rate to $750,000. That's huge for people, that you have the ability to write off the interest that you pay on your mortgage. That had been in the offing also. At least that's still in there, at a different level.

JOHN AVLON, CNN POLITICAL ANALYST: I think Errol's point is this bill is unpopular because of the speed at which they passed it. Because this has not been exactly exemplary policy. But those polls reflect that perception. The details are just coming out. It was a bad bill, but it's a slightly less bad bill in this function. They've tried to address some of the real inequities, like graduate student and student deduction. That's still in there.

CUOMO: No, I'm saying you're still allowed to have deduction.

AVLON: Correct.

CUOMO: That had been taken out.

AVLON: That had been taken out, which was just like an insult to people trying to climb up the economic ladder. What it's not is a middle-class tax cut. What it's not is a gift to future generations, because it's likely going to explode the debt. But this is a zero-sum politics game. Republicans need to get a win on the board. That's been the motivating factor. And there's no way Mitch McConnell is going to wait for the new year and for, you know, Doug Jones to get seated.

CUOMO: What's the mistake in the initial pitch? If Trump hadn't pounded this as the delivery for the little guy, for the middle class, if he hadn't pitched it that way, and if they hadn't echoed that along the way and just said one of the first things we're going to do is cut taxes. You will get a tax cut; you will get a tax cut; you will get a tax cut.

AVLON: Just like Oprah.

CUOMO: That's right. That's what it was. A general tax cut. The sell, is that part of what poisoned the well here?

LOUIS: Well, look, some of it, the rationale just kind of fell away. At the same time as the reason for all of this was supposed to be so that you could jump start the economy. Let's put some stimulus into the economy. Well, the economy was heating up anyway. The stock market was hitting new highs. We had GDP growth. A genuine accomplishment that he really could have taken credit for. But instead of saying that, they're saying let's put more rocket fuel on it. Let's -- let's damage the long term prospects of the fiscal health of the nation. Because we've got to get up to, you know, 3 percent growth, 4 percent growth.

Well, I don't think most people understand that that's super important for them right now. We're approaching full employment, for God's sake. I mean, there are some issues around whether or not that's being equitably distributed.

But that, of course, has never been talked about. People realize that what is being talked about and what's being planned and what's going to happen in their life is not really quite the same thing. And that's why the polls are so--

CAMEROTA: So, John, explain the debate over whether to wait for Doug -- Doug Jones to be seated and how this has echoes of Obamacare.

AVLON: Right. So the precedent being cited by Democrats is back during the ACA Obamacare debate when Scott Brown shocked the world by winning as a Republican in Massachusetts.

CUOMO: Ted Kennedy died. He wound up filling the seat.

AVLON: Correct. So Mitch McConnell argued that Democrats should wait for Senator Brown to take the vote. The voters of Massachusetts have spoken. And Democrats ultimately agreed.

CAMEROTA: President Obama. I think that we have that sound. We have that from 2010. He went along with that logic. Listen to this.

(BEGIN VIDEO CLIP)

OBAMA: Here's one thing I know. And I just want to make sure this is off the table. The Senate certainly shouldn't try to jam anything through until Scott Brown is seated. The people of Massachusetts spoke. He's got to be part of that process.

I would advise that we try to move quickly to coalesce around those elements of the package that people agree on.

(END VIDEO CLIP)

CUOMO: When is this bygone era of decency and reasonableness?

AVLON: I mean, it's absolutely -- that's like a dispatch from another era.

CAMEROTA: Planet.

AVLON: Yes. So Mitch McConnell requested that that be happening. Now, of course, situational ethics are rampant in Washington, and he is not going to agree to the same standard he insisted upon then.

And you're not going to hear President--

CAMEROTA: They're not going to wait for Doug Jones?

AVLON: There is a -- I would be shocked and there's actually no point to even indulge the thought they might. That's just not the way they play pool right now. This is situational ethics. And they want it in one situation. They don't want it in this one. They want to ram this bill through. And we'll see if the approval ratings improve. We'll see its impact on the economy, the deficit, the debt.

I think there are a lot of indications, particularly with the corporate, that this is going to increase inequality. Because remember, not in addition to that but they didn't close any of the loopholes. The whole deal, which Obama backed, lowering corporate tax rates, closing those loopholes. That's -- that's sort of off to the side. So we'll see if this bill exacerbates the problems that, in some ways, Trump was elected to help address. That was the talk.

CUOMO: Roy Moore is also in the news. He will not concede in the race. He put out a video. Here's a taste.

(BEGIN VIDEO CLIP)

MOORE: We are indeed in a struggle to preserve our republic, our civilization and our religion and to set free a suffering humanity. And the battle rages on. In this race we have not received the final count to include military and provisional ballots. This has been a very close race, and we are awaiting certification by the secretary of state.

(END VIDEO CLIP)

CAMEROTA: I mean, we've spoken to the secretary of state here who has said this is of.

JOHNS: There will be certification. And then it will be over. And the certification will be transmitted to the Senate. And then the new senator will be sworn in. And the whole thing will be over. It's tremendously irresponsible for him to, No. 1, sort of add all of this emotional freight to it as if, you know, this is suffering humanity.

No. Actually, it's just one more race that you've lost. Not the first time he's lost an election. It happens. That's part of the business. Terribly irresponsible. And at the same time, you know, kind of a waste of everybody's time. I mean, you know, it's -- nothing is going to change. The Republican Party in Alabama has said, "Look, it's over. It's over. We're going to do our job as we're supposed to do."

CUOMO: Although it is a reminder Roy Moore is who he is, warts and all. And there are plenty of those, and there always were even before those allegations. But it is a reminder of a battle that is raging. People do believe there is a culture war afoot. It's not just going to go away when Roy Moore goes away.

Oh, definitely. It's just that that particular playbook with that particular messenger couldn't win even in Alabama. But look, President Trump called Doug Jones to congratulate him. The secretary of state on the show yesterday talked to you and Chris, basically said this is done. So the idea that we are sort of, you know, hunkering down in the hills for the resistance doesn't comport with reality.

CAMEROTA: John Avlon, Errol Louis, thank you both very much.

CUOMO: All right. So another big moment yesterday. Deputy Attorney General Rod Rosenstein was on the Hill. He defended Bob Mueller and the Russia investigation. What did he say about Republican claims of bias? What did he say about whether or not firing Mueller should be on the table?

CAMEROTA: And we are taking the pulse of the people again. How Trump voters feel about Roy Moore's defeat? That's ahead.

(COMMERCIAL BREAK)

[06:18:19] CUOMO: We're looking at Deputy Attorney General Rod Rosenstein defending Special Counsel Bob Mueller and the scope of his Russia investigation. Testifying before the House Oversight Committee, Rosenstein also pushed back on suggestions that the investigation is biased.

First the facts. CNN's Jessica Schneider is live in Washington with more. What can you tell us?

JESSICA SCHNEIDER, CNN CORRESPONDENT: Well, quite simply, Chris, Rosenstein, he was unwavering in his support of the special counsel and his team throughout this hours-long contentious hearing, where Republicans repeatedly alleged political bias.

Of course, they're pointing to those anti-Trump text messages between FBI agent Peter Strzok and FBI lawyer Lisa Page during the election. The Justice Department released hundreds of those messages this week. Two of them were from March 2016 at the height of the primary. They show that Lisa Page, the attorney for the FBI, she said that -- she said, "God, Trump is a loathsome human."

And that's when Strzok responded, "Yet he may win."

Another text from March 2016 has Strzok saying, "OMG, he's an idiot."

Then Lisa Page responding, "He's awful."

Now, these exchanges were repeatedly brought up with Republicans saying that a second special counsel should be appointed to investigate, since Strzok was on the Russia probe until he was removed this summer. He also played a leading role in the Hillary Clinton e- mail server investigation.

But Rod Rosenstein stood firm, saying that the inspector general investigation is sufficient for now. And then stressed that Robert Mueller himself would not be removed. Take a listen.

(BEGIN VIDEO CLIP)

REP. JERRY NADLER (D), HOUSE JUDICIARY COMMITTEE: Have you seen good cause to fire Special Counsel Mueller?

ROSENSTEIN: No. We recognize we have employees with political opinions, and it's our responsibility to make sure those opinions do not influence their decisions. Pardon me. And so I believe that Director Mueller understands that and that he is running that office appropriately.

(END VIDEO CLIP)

[06:20:12] SCHNEIDER: So Rosenstein saying there that political views are different than bias. But of course, that explanation has done little to placate Republicans. In fact, last night the No. 2 Republican in the Senate, John Cornyn, he called for Special Counsel Robert Mueller to just clean house of his team, clear house of the people on his team who have been politically active or have made comments critical of the president -- Chris and Alisyn.

CAMEROTA: OK. Thank you very much for all of that reporting.

Let's discuss it now. We have chief legal analyst Jeffrey Toobin and CNN counterterrorism analyst Phil Mudd.

Phil, I want to start with you, because you were at the FBI. I thought that Rod Rosenstein was doing a good job of trying to give a very logical answer to, "Yes, we understand that agents can have political opinions. And we hope that they are responsible and don't let that color the investigation and their work. And if we figure out it is doing so, we reassign them or take some sort of corrective action."

So how does it work? I mean, obviously FBI agents are human. They have opinions. So how can they make sure that it doesn't ruin an investigation?

PHILIP MUDD, CNN COUNTERTERRORISM ANALYST: A couple things you're looking at. First, if you think of the inspector general, remember the inspector general is looking at these. These are independent individuals, the inspectors general, who do not report to the FBI director. So when they conduct an investigation of whether there's wrongdoing within the staff on the Mueller team, they can do whatever they want.

Having seen them operate from the inside, the FBI, I can tell you they are a hammer. For anybody in this viewing audience who's ever seen flashing red lights behind them when you get a speeding ticket, it's like that feeling of dread in the rearview mirror. When they start looking at you, they don't look without coming up with something typically. They are really rough to deal with.

So you can expect not only that the inspector general is looking at this with a pretty, you know, tight focus but also that there will be recommendations to the Department of Justice and the FBI about action against the individuals involved. I'd expect some discipline, Alisyn.

CUOMO: Well, we've already seen some. And Rosenstein shared your apprehension yesterday, Philip Mudd. Because he seemed to lean on that. "Well, you know, you want to know my thoughts about Comey? I already put them out in my memo, concerns about Comey. You've got the inspector general looking into that." He seems satisfied with that. He seems satisfied that the Russia probe was not tainted. And he seems satisfied that Bob Mueller is beyond reproach.

JEFFREY TOOBIN, CNN CHIEF LEGAL ANALYST: You know, there was a subtext to the whole hearing, which is the Republican Party, especially Republican media, FOX News and company, have been agitating for the president to fire Mueller. That drum beat is rising in the Republican Party.

Rod Rosenstein is Mueller's superior. Trump can't fire Mueller. Only -- he can only direct Rosenstein to fire Mueller. What was clear from yesterday is that Trump is going to have to fire Rod Rosenstein.

CUOMO: Tell the people why. There was a two-step question and answer they asked him yesterday, Rosenstein, about this specifically. Remember, when he was asked, do you think there was any reason to?

TOOBIN: Right.

CUOMO: And if you were directed to -- and he went back to what the test is. TOOBIN: The test is -- I want to get the exact words. Dereliction of

duty.

CUOMO: He said, "I would take a look at it, and if there was cause, then I would. If there is not cause, I would then not go with the suggestion." And he then buttoned it up again by saying, "And I do not see cause--"

TOOBIN: "I do not see cause."

CUOMO: "-- to remove Bob Mueller." That was a pretty clear message.

TOOBIN: It was an explicit message. And that means that, if the president wants to get rid of Mueller, he's going to have to do a Saturday night massacre. He's going to have to start firing people in the Justice Department until someone agrees to do his bidding. And that would be a political earthquake even in the contemporary political environment.

CAMEROTA: So Phil, I mean, what do you say to the -- all the critics, now of this investigation who do have this drumbeat that, you know, it's become tainted because of this trove of 375 text messages that were anti-Trump? I mean, what's your response to them?

MUDD: There's a lot of humor in this one. Across America, everybody has got a political view. If you wanted to look at the e-mails of the Democratic and Republican staff working on the Senate committee reviewing this, what do you think those e-mails would say?

I think there's a couple things we've got to look at here.

First of all, a Republican-nominated former FBI director is conducting an investigation. That's Robert Mueller. I must have met with him 1,000, 2,000 times. I can't remember a single time where he uttered one political word about any candidate except candidates or politicians who are under investigation by the FBI.

CUOMO: You've been with him so much, Phil, you kind of look like him.

MUDD: So you're telling me I'm pretty good looking? It makes me feel good, Chris, because I'm on the air with you. My day just goes better. I look at you and say, it doesn't get any worse.

CAMEROTA: Oh, boy.

MUDD: But my--

CUOMO: All right.

[06:25:02] MUDD: But my point is -- my point is, for everybody who says it's a witch-hunt, you have a Democratic -- pardon me, a Republican deputy attorney general who says, "We've got to proceed with this." You've got a Republican-nominated former FBI director. You've got, remember, the Republican chairman of the Senate committee who says we have to proceed. Where's the Democratic witch-hunt here? It's a bunch of Republicans saying we've got to go down this road. CUOMO: And remember Hillary Clinton and her people when the e-mail

investigation was going on, how they were making the same claim. There are people in the FBI who hate her. They want to get after her. That's why they were going after Comey to prosecute, because they don't like her. They think she's a liar. It kind of works both ways.

MUDD: It sure does. It sure does. One final comment.

CUOMO: Please.

MUDD: If you want to look at the FBI director's 12-year history, he also -- he also investigated Democrats. That's a story, Chris.

CAMEROTA: All right. There you go. Sorry to interrupt the bromance.

CUOMO: You say -- you say that I make your day better, you get the final word.

CAMEROTA: That is so true. Phil, Jeffrey, thank you.

So there's another high-profile departure from the White House. Omarosa fired again by Donald Trump. The mystery surrounding her sudden departure. What's behind it?

CUOMO: Ben Carson found it very funny.

(COMMERCIAL BREAK)

CAMEROTA: One of President Trump's most high-profile assistants, Omarosa, is out at the White House.