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House Passes Debt Ceiling Increase; Gabrielle Giffords Returns to Congress to Vote on Debt Ceiling

Aired August 1, 2011 - 22:00   ET


ANDERSON COOPER, CNN ANCHOR: We are going to have the behind-the- scenes story of Gabby Giffords' appearance today. We're going to talk to Debbie Wasserman Schultz, who actually helped her out onto the House floor. We will talk to her later on in the program.

The breaking news tonight on the debt deal: no vote until tomorrow in the Senate, and a breathtaking moment just as the House was voting to pass it. It looked and sounded like business as usual and then, as we pointed out, everything changed. Listen.



COOPER: For that moment or two, nobody watching knew quite what to make of it. Then word got out it was wounded Arizona Congresswoman Gabrielle Giffords entering the chamber to cast her first vote since her being shot in January.

As I said, we will have a lot more on her remarkable comeback a bit later on in the program. She had returned in case her yes-vote was needed to provide the margin of victory. and said her vote was need. Turns out it was not that close. Take a look.


REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: Ayes are 269. The nays are 161. The bill is passed and without objection, a motion to reconsider is laid on the table.


COOPER: Well, of that 161, 95 Democrats, a majority, voted no. So did 66 Republicans.

Liberal Democrats, for the most part, and Tea Party Republicans joining in opposition. Now, in a moment, a Democratic congressman who voted no and who called it a "sugarcoated Satan sandwich." We will ask him what that means and GOP Senator Rand Paul, who plans to vote no tomorrow.

Shortly before airtime, congressional correspondent Kate Bolduan spoke briefly with House Speaker Boehner.



BOEHNER: I feel great.

BOLDUAN: How do you -- what do you think of the vote this evening?

BOEHNER: I thought it was a strong vote, but the first step in many steps yet to go.

BOLDUAN: What you hope the American people take? What do you think the message is for the American people tonight?

BOEHNER: The process works. It may not be pretty, but it works.


COOPER: Definitely not pretty. President Obama said nothing publicly today, but reluctantly endorsed the compromise last night.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Now, is this the deal I would have preferred? No. I believe that we could have made the tough choices required on entitlement reform and tax reform right now, rather than through a special congressional committee process.


COOPER: Well, some on the left put it a little differently, Paul Krugman slamming Mr. Obama in today's "New York Times" under a headline reading, "The President Surrenders."

Now, you can decide what happened, but here is the deal, more than $2 trillion in savings over the next decade, including $21 billion next year, a little more than $900 billion already agreed on for the next 10 years. Then a bipartisan commission made up of six House and six Senate members would be charged with laying out by this Thanksgiving at least another $1.2 trillion in spending cuts and/or revenue increases to complete the deal.

They would have to stay away from Social Security and Medicaid. Now, if the panel can't agree, across-the-board cuts would kick in, including on defense spending and payments to Medicare providers. The bill would also call for a vote on, but not passage of a balanced budget amendment to the Constitution.

Gloria Borger talked about that last week. In exchange for all that, the debt ceiling will be raised through the end of next year, Democratic and Republican supporters each trying to claim credit for getting a handle on the deficit.


REP. STENY HOYER (D-MD), HOUSE MINORITY WHIP: We need to return the fiscal responsibility. REP. DAVID DREIER (R), CALIFORNIA: How is it that we're going to be able to do that? Getting our fiscal house in order.

REP. TOM REED (R), NEW YORK: The American people have spoken loudly. They want us to get our fiscal house in order.

BOEHNER: Fiscal handcuffs on this Congress that are sorely needed.

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: Washington is beginning to get its fiscal house in order.


COOPER: Wow, remarkable how responsible and on the same page everyone sound there. Yet, as we mentioned, the ordeal that Washington is putting the country through, well, it is not yet over. The Senate does not vote until tomorrow. Deadline today somehow ensuring they're not just going into the 11th hour on this hot mess, but right up to the last second of the last minute of the 11th hour.

New polling tonight from Pew Research. People were asked for their one-word assessment of the budget negotiations. Just 2 percent, 2 percent had something positive to describe the process, 2 percent with a positive word. You can imagine some of the words folks would use, not a kind word, just a positive one.

The number-one word used by 66 percent was ridiculous.

All the angles tonight. John King joins us on Capitol Hill, Jessica Yellin at the White House. Chief political analyst Gloria Borger is with us. Wow. That's a six-box -- along with Ali Velshi, who is covering the impact on the nation's economy and yours a bit later, perspective on the political fallout from Democratic Paul Begala and's Erick Erickson.

So, John, a lot of talk about winners and losers in all this. You say the president actually maybe wins by losing. How so?

JOHN KING, HOST, "JOHN KING, USA": Well, remember, Anderson, at the beginning, the president was trying to negotiate a $4 trillion big deal. He gets a little more than half that, $2.4 trillion.

Remember, he said he wanted to do this all in one-fell swoop. This is two-tiered system, so this debate will be back in several months. The president also said it had to be balanced, meaning it had to include some tax increases. He didn't get that in the first swoop. He's unlikely to get it many believe in the second swoop.

And yet why does he win? Because as a candidate for reelection, bad manufacturing numbers this morning, bad GDP numbers Friday, an anemic unemployment report expected this coming Friday. The president, the last thing he needed was to be the first president in history to have default happen on his watch. And the last thing he needed beyond that was to have more uncertainty, more turmoil, a collapse of the financial markets, a president running for reelection in a very tough economy. He has enough to worry about, Anderson. He did not need a default.

COOPER: Jessica, does the White House see this as a win?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: They see this as the better outcome of many possible outcomes, Anderson.

Just a few days ago, there were plenty of Democrats who thought at this point we could be at a 50/50 percent chance of default. They really thought that default was a likely possibility here. So this is a happy outcome. Here at the White House tonight, I will tell you there's a sense of exhausted relief. It's the first night in many weeks that there are lights out at this building. People have gone home. It's a little bit lonely here on the lawn.

And they -- they're aware that they have been bruised politically by this fight, that they have left some Democratic priorities on the table that they will have to stand and fight for again. But this is certainly not the worst of all the possible outcomes that they could have faced. And they also think that the Republican Party has not served itself well in this fight and will have a lot to answer for in the upcoming election.

COOPER: Gloria, saying it's not the worst, that doesn't really necessarily mean it's a win either. Someone could argue that President Obama looks weakened in this and that the Republicans seem to have gotten more than the Democrats got.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, you know what? First of all, nobody really wins here in public opinion, as you just said, because the public take a look at this and says why can't they just get this over with, do their jobs, raise the debt ceiling?

But I was talking to a senior White House official today who said, look, if you look at this down the road, we have some other landmarks that are coming up in November and again in December. And he said, look, this could frame the debate for the White House for 2012.

If Republicans are only for cuts in entitlements and not for any kind of revenue, that's something that our public opinion show the public does not support. And you recall when the Ryan budget came out right around the summer, Republicans started going home to their town hall meetings and started getting a lot of grief on the Medicare issue.

So this official's position is, well, this could come back to that point again if we don't do anything beyond entitlements, when we have to deal with what the commission tells us to do. So they think they will be OK.

COOPER: Ali, what effect does this actually have on the federal debt?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, it brings it down as you know by $2.1 trillion over 10 years. That's not enough. That's...

(CROSSTALK) COOPER: But isn't that bringing it down from just what it was projected to be?

VELSHI: That's correct.

COOPER: Right.

VELSHI: So that's why the...


COOPER: Because Republicans are saying you're still spending $7 trillion.

VELSHI: And there's no way. We have done the math. There's no way to bring that math in line and really bring the deficit down, down, without increasing what Republicans call revenues, but taxes. There's just no math.

COOPER: No way to do it?


VELSHI: Well, the only way to do it is grow like India grows and grow like China grows. That's not going to happen in America. That's the only way you can get your out of this. So this has to happen. President Obama, as John said, wanted a $4 trillion deal.

That's what the ratings agency said we needed. He got half of that. You can't get to that $4 trillion without tax increases..

COOPER: Well, Republicans say, well, don't raise taxes; raise taxpayers. That's a line they use a lot.

VELSHI: Well, let's call it tax reform, right? There are a whole bunch of people in this country who don't pay taxes? There are a whole bunch of companies that don't pay taxes.

So if you got everybody to pay some taxes, in theory all of us would pay a lower percentage. But you got to do both of those things together. We have got to figure out how to get more money. And this is going to affect all of us. This is also middle class. One thing about this administration, they say they don't want tax increases for the middle class.

Again, the math doesn't work. Everybody is going to pay a little bit more taxes. That's how you get to your $4 trillion.

John, you're a young man, but an old Washington hand. Is Washington different than it was even two years ago when we were all talking about how polarized things were?



KING: Yes, it is. It's still polarized. We saw that.

We see this deal today. We see this compromise today. We will see if it follows on in the future. But in terms of the conversation in Washington, remember when President Obama took office. He came into office. He passed a big health care plan that involved a huge activist role for the government. He passed an $800 billion stimulus plan that included a whole lot of government spending to prime the economy.

He wanted to pass more infrastructure spending this year. He wanted to increase education spending. What is the conversation in Washington about? Cutting spending, shrinking government, not raising taxes. We will see what happens with this super committee.

We will see if the president gets his revenues, tax increases, in the second installment of this. But this is a dramatically different conversation in Washington about the role, the size, the scope of the federal government, where the money comes from and that's because of the last election, 2010. The American people in 2010 spoke a very different message than they spoke in 2008. Now we will have a debate, 2008 Obama, 2010 Republicans -- and we will carry that into 2012, including, Anderson -- a lot of people say this deal will quiet this debate.

No, it won't. Just for a couple of days maybe. When this committee gets to work, we will be back involved in every single one of these issues again. And then it's going to spill into the election.

COOPER: Gloria, haven't there been though a ton of committees already that have come up with plenty of ways to save money and cut the deficit?

BORGER: Yes. Right.

COOPER: And there's been I don't know how many. What is this one going to get that the other ones haven't gotten? Isn't this just kind of a, oh, yes, we will create a committee?


BORGER: Yes, I think that's a really good question. I think there are a lot of skeptics about this.

I think there are some skeptics about it inside the White House. I think that the feeling is, the hope is that maybe people will start seeing the light together when they're confronted with these Draconian cuts that would kick in.

It's sort of saying to them it's an admission essentially that we can't do our jobs that you sent us here to do unless you threaten us with these awful cuts. And if these cuts actually occurred, we'd probably not get reelected.

So the feeling is that when you put this sledgehammer to them, maybe they will do their work. One other thing, though -- and again, there's a short period of time here, but as somebody said to me today, this isn't ground -- this isn't new territory. People understand the issues here. You had the Erskine Bowles and Alan Simpson commission, which did a very long and detailed report.

Everybody knows what needs to be done. They just have to agree on it. But I think you're absolutely right. I think there's a lot of reason for skepticism. I do.

COOPER: And, Jessica, you're hearing the Treasury Department is going to talk to rating agencies tonight. Do we know what -- what they're saying?

YELLIN: They're already -- according to my sources, Anderson, they are already talking to rating agencies. And the ratings agencies are asking for details of this deal, because the agencies are still evaluating the deal to decide if we're going to be downgraded.

It looks like we're on the way to avoiding default, but we're not entirely out of the woods yet, because they -- these agencies will decide if -- what this deal means and they have yet to make this decision about a downgrade. So there are these conversations going on with the administration from Treasury and these agencies and we will have to see tomorrow and in the coming days what kind of statements come out of the rating agencies ahead.

COOPER: If we have gone through all this and still get downgraded, Ali, there was warnings of that, but -- and I guess there's levels of downgrade.

VELSHI: There are levels of down -- there's the little one, which we may still get, and that is from AAA to the next level. That's very different from a downgrade that you get if you default. That one is a serious one.

So, what we might get is the little downgrade. Japan and Canada have both been through in the past. They both recovered from their downgrades as a result. When it's a small downgrade and you show efforts to fix it, you can get back from it.

COOPER: Let's see.

Ali, appreciate it

Ali, John, Gloria, Jessica, thank you.

We will turn to Paul Begala and Erick Erickson in just a moment to look a bit more closely at the political repercussions on both sides, get their take on what happened today and what will happen tomorrow.

Tea Party favorite Senator Rand Paul also coming up.

Let us know what you think. We're on Facebook. Follow me on Twitter @AndersonCooper. I will try to tweet tonight if I can up in this hour.

Up next, I will talk to a Democratic lawmaker, why he called the budget deal a "sugar-coated Satan sandwich," exactly what that means. And later, we're going to talk to a close friend and colleague who was literally right by Gabrielle -- Congresswoman Gabrielle Giffords' side as she made her stunning return to the House floor tonight.

We will be right back.


COOPER: Our breaking news tonight, the Senate will take it down to the wire, voting not tonight, but tomorrow, deadline day on a compromise to end the budget crisis.

In a moment, Kentucky Senator and Tea Party favorite Rand Paul, who plans to oppose it, but first my conversation earlier tonight with Congressman Emanuel Cleaver, Democrat of Missouri, who also voted no in the House, and said quite a bit more than just no in opposition to the bill.


COOPER: Congressman Cleaver, you voted no on this bill. You also called it a -- quote -- "sugarcoated Satan sandwich."

What do you mean by that?

REP. EMANUEL CLEAVER (D), MISSOURI: Well, if you pick up the -- or pick up the first sheet and start delving into the bill, you will see that there's nothing in the bill that would garner the support of any of the great religions of the world.

And by that, I mean everything that we're supposed to do, take care of the elderly, take care of those who are unable to take care of themselves, also dealing with our children, those things were not protected. And although there are some so-called fire walls in there, this new super-Congress of 12 will have some enormous powers.

And keep in mind that Social Security, Medicare and Medicaid are not off the table. It's been delayed in terms of when that subject will surface. It was a bad bill. I voted no after 250-something votes had already been registered, so I knew that the bill was going to pass.

In fact, I had said earlier that if the bill needed my vote, I would vote yes because I wasn't willing to try to make a point and at the same time drive the economy off into the abyss. But make no mistake, I don't know of a single Democrat who voted for this bill who thought it was a good bill, I mean not one single Democrat.


COOPER: I know you said that the consequences of default would be catastrophic.

But it's interesting you say you would have voted for it if -- if your vote was needed to make it pass. I guess a critic could say, well, then, that your vote is sort of about politics in this case, because you knew your vote didn't really matter to get it passed, and so it was sort of a safe vote to vote no on.

CLEAVER: No. No. It really wasn't about politics because I made that statement before the vote. And I thought it was a bad bill.

I talked about the fact that it was a bad bill. And so the safest and easiest political vote was to vote yes. I mean, I stay in favor with the White House. I get kudos from folk who just simply wanted to get it out of the way. But I registered a protest vote.

COOPER: Some Democrats today in a meeting with Vice President Biden, there are reports that some of their complaints were saying the Republicans were negotiating like terrorists.

How would you characterize the tenor of the debate, the willingness of some in the Republican Party to try to get what they want?

CLEAVER: Well, you know, I'm disappointed in the way the debate went. We had a fact-free debate.

But let me say this. I want to give kudos to the Tea Party members, because they pretty much had their way.

COOPER: They won, you're saying.

CLEAVER: Well, I don't think there's any question that they won politically. I think the American public and, in fact, the world probably won because we didn't blow up the U.S. economy and bring down the world economy with us.


COOPER: So, do you worry moving forward about the ability to govern, about the ability kind of actually get compromise, to get things done moving forward?

CLEAVER: It all depends on whether or not the individuals who won come to the conclusion that they can win every battle if they're willing to send everybody off a cliff. And if they think that that's the way government is supposed to work, I think that's going to continue.

COOPER: Congressman Cleaver, I appreciate your time. Thank you, sir.

CLEAVER: Good to be here with you.


COOPER: Well, Congressman Cleaver bitterly disappointed.

Minority Leader Pelosi not exactly thrilled either. President Obama taking heat for his negotiating style, the poker analogies flying all day. One blogger saying Mr. Obama was holding three nines and got beaten by a pair of fours. I don't know what that means because I don't play poker. Or was he making the best of a much weaker political hand? Joining us now, Democratic strategist Paul Begala and Erick Erickson of, who just tore himself away, I understand, from "The Bachelorette," as he tweeted in the makeup room.


COOPER: So, Paul, a sugarcoated Satan sandwich? How upset are Democrats right now?

PAUL BEGALA, CNN POLITICAL ANALYST: Yes. I think that's pretty typical of it.

And I think -- Congressman Cleaver, by the way, is also Reverend Cleaver. And so he is an ordained minister. He also knows of which he speaks, both legislatively and I think spiritually.

This is the problem. Democrats are furious about this because -- I think they make a good point -- instead of an even-steven 50/50 deal, which I think most fair-minded people would do -- it's what President Clinton when I was working for him -- we had about $1 in tax cuts -- tax increases for about $1 in spending cuts.

We're getting all spending cuts in priorities and programs that, in the main, Democrats strongly support. There's a bigger thing at play here, though, too. And I think Congressman Cleaver sort of referred to that, which is, this obsession on the debt ceiling -- and it's an artificial contrivance -- we just created that as a country -- has distracted from what a lot of people think is a bigger problem, and that is jobs, growth.

I got an e-mail about an hour ago, believe it or not, from Willie Nelson, who said there's a lot of people who are a lot more worried about a ceiling over their head than they are about a debt ceiling. And I think he's right. I think there's great wisdom. Willie is one of the great poets and philosophers of America.

COOPER: I love that Willie Nelson has your e-mail account, by the way. I'm just...


BEGALA: I live a weird, but blessed life. He's my hero, I have to say. I'm from Austin. In Austin, if you don't believe in Willie, they call you...


COOPER: Who doesn't believe in Willie? Yes.

BEGALA: That's right.

COOPER: Well, Erick, what are -- you talked to Republicans, it's interesting. And I talked to Rand Paul and we will play that in just a moment.

And he says, well, look, we were willing to compromise. We compromised on being willing to raise the debt ceiling.

But is that really a compromise? That wasn't really a compromise by Republicans. That wasn't really a Democratic issue, was it?

ERICK ERICKSON, EDITOR IN CHIEF, REDSTATE.COM: See, for a lot of Republicans, Anderson, it actually was. And you and me and Paul may scratch our heads over that, but a lot of these guys ran on not raising the debt ceiling.

And a lot of them, particularly in the House, they viewed themselves as replacing people who were willing to lose to vote for Obamacare and they were willing to lose to not raise the debt ceiling. And we may say that's not how Washington worked, but they genuinely believed it.

And, by the way, Paul being from Austin, I think that's the place where you can get the burger between the two Krispy Kreme donuts, which I think that's the sugarcoated Satan sandwich.


COOPER: Yes, probably so.

Paul, what about that? Is that fair, though, for Republicans to be saying, well, look, we were willing to compromise with the Democrats and raise the debt ceiling? When did that become -- I don't understand when that became a Democratic issue or a Democratic position.

BEGALA: Well, we have been raising the debt ceiling for generations.


COOPER: Right, Republicans and Democrats.

BEGALA: Right, from either party.

Now, I will say, an admission against my party's interests, when he was in the Senate, Barack Obama voted against raising the debt ceiling when George W. Bush was president. I think that was political then.


COOPER: Right, which he has acknowledged. He's actually said that was wrong and was political.

BEGALA: Right. And that's correct.

But I also do think there's some principle at stake here. And in that sense I respect the Tea Party and the other conservatives. I don't agree with them. I think they would have done great damage to the country, but at least they show that they have the courage of their convictions.

I do wish the Democrats would come forward with a jobs bill. I do hear that the president and the vice president today were telling congressional Democrats, we get this done, then we pivot to jobs. And I sure hope so. And I think it better be a pretty robust jobs program, because we do have a long-term deficit problem. There's no doubt about it.

But we have a near-term jobs crisis and a growth crisis. And we will never pay off this deficit with 14 million Americans out of work.

COOPER: So, Erick, politically, did the president get crushed here? Because earlier we heard John King saying, well, maybe this was a win for Obama. I think a lot of Tea Party people feel it was a win for the Tea Party. Do you think the president won here?

ERICKSON: Yes, you know, it depends on whether you're looking at policy or politics. Policy, probably not. And he will get hurt by his base. If you look even at "Mother Jones" tonight, they are lamenting that this maybe is a rejection of the American people of government.

But politically I think he did win because he gets this issue off the burner altogether before January. People are going to have completely forgotten about this by March. The deficit commission -- by the way, to answer your question from earlier with Gloria, this will be the 19th in 30 years.

COOPER: Thank you. OK.

ERICKSON: The first one happened when it was $1 trillion. Now we're at $14 trillion.

So, it will get all this off the back burner by March. People will have completely forgotten about this. Frankly, I think Paul and I can probably agree this election is going to be about jobs. It's not going to be about the debt ceiling. It's not going to be about diplomatic relations with foreign countries. It's going to be about jobs.

And if the unemployment rate goes down, he will probably get elected, if it goes up, maybe not.

COOPER: But, Paul, do you think this was a win for President Obama?

BEGALA: No. No, I don't.

I do think -- and having worked in the White House my heart goes out to him. He was dealing with folks who he believed were willing to harm the economy to pursue their principled and perhaps even political agendas.

But this is the problem, is that the Commerce Department, Obama's, President Obama's own Commerce Department says that in the last quarter, austerity measures by state, local and federal governments, spending cuts by government, reduced the GDP by 1.2 percent. So there's no doubt this is contractionary. There's no doubt that this will cost jobs. And yet we're doing it anyway when the president needs new jobs. He needs to be creating jobs, not shaving jobs off of our payrolls.

ERICKSON: But, Anderson, I think there's a larger issue here. And no one really is talking about this.

If you go back to 1999, which was the best revenue the federal government has probably ever seen, it only went up to 21 percent. The last time that had happened was the end of World War II in 1945. But the federal government is now spending at 25 percent of GDP, and it seems pretty impossible to close the gap.

You forget, go back to the '50s and '60s, tax rates were in the 70 percent. We're now down to 30 percent. And tax income has been pretty steady in the federal government up until the past year or two with the extent of the recession. And even if it goes back up, it's not going to close the gap.

And so at some point, the government is going to have to say, we can't keep running perpetual debt. We're at $14 trillion. And if this plan goes through as they intend it to go through, we will add another $12 trillion.

BEGALA: But that's a good point. First off, most of that spending increase, almost all of it, was automatic spending increases caused by the recession.

But why then, just seven or eight months ago, in December, did we have -- oh, and all the so-called experts thought it was wonderful -- this bipartisan agreement back then to increase the debt by $858 billion in the form of tax cuts, which apparently have done very little to stimulate our economy, since the economy is still flat?


BEGALA: So, we just added $858 billion to the -- so we need to cross both those lines the other way. In other words, we need more revenue, higher taxes, I hope on the rich. And, yes, less spending.


COOPER: We have got to wrap this up.

But, Erick, final thought.

ERICKSON: I have got this question for you here. If 49 percent of the country doesn't pay taxes, and 51 percent already do, I still have a hard time understanding what their fair share is.

It's looking more and more like some in the middle class, if we're going to do revenue, at some point, we're going to have to raise their taxes, too, if we go along those ways, instead of cutting spending.

BEGALA: Well, first off, believe me, you're just talking about the income tax, which is a rich person's tax. Middle-class people, poor people, they pay gas taxes and excise taxes and payroll taxes and all kinds of taxes. So working people are paying their fair share. I'm not worried about that.

It is -- as Warren Buffett, who is one of the richest men on Earth, said: There's a class war going on, and my class is winning. And I think Mr. Buffett is right.

COOPER: Paul, your Southern accent has gotten more Southern over the course of this interview. I'm not sure how that's possible.


BEGALA: I think it's getting the e-mail from Willie.


ERICKSON: It's Willie Nelson, yes.


COOPER: All right, thank you, Paul Begala, Erick Erickson.


COOPER: Stick around. We're going to have more to talk about ahead.

Coming up, Kentucky's junior senator, Republican Rand Paul, he plans to vote no tomorrow when the bill comes to the Senate -- why he's not willing to compromise on the debt ceiling, even he says he is kind of willing to compromise. We will try to figure that one out.

Plus, a moment that everyone, no matter which party, could embrace -- Congressman Gabby Giffords back on the House floor to cast her first vote since she was shot in January. Her friend and colleague Representative Debbie Wasserman Schultz joins us with a kind of behind-the-scenes look.


COOPER: More on tonight's breaking news on the debt deal. For those who just joined us, here is the latest.

The house tonight voted to pass the agreement reached yesterday by President Obama congressional leaders.

Final vote, 269-161.

Liberal Democrats for the most part and tea party Republicans joining in opposition. House Majority Leader Eric Cantor downplayed the ugly drama leading up to tonight's vote.


REP. ERIC CANTOR, (R) MINORITY LEADER: I feel like we accomplished a lot by passing that bill. It is the beginning of a process but we are going to change it the system in this House.

And it also, I think, sends a signal that we can work together to try to produce results and right now it's about time to address this economy so people can get back to work.


COOPER: The bill raises the debt ceiling through the end of 2012, calling for more than $2 Trillion in savings over the next decade.

President Obama reluctantly endorsed the compromise and said nothing publicly today.

Senate vote is expected tomorrow I think around noon.

Earlier I spoke to Kentucky Senator Rand Paul who plans to vote No against the bill tomorrow.


COOPER: Senator Paul, you plan to vote against this in the senate. You're unwilling to participate in a congressman that can pass through Congress and get signed by the president. Your critics were say that a refuse on the compromise is counter constitutional that for the democratic process to work, you have to compromise is not -- is compromise a dirty word?

SEN. RAND PAUL (R), KENTUCKY: Interestingly, we've offered several compromises. I was part of a group that orchestrated a compromise called "cut, cap and balance." which would have given the entire $2 trillion the president requested in exchange for a balanced budget amendment.

COOPER: The cut cap and balance I understand the idea behind it but it's not something which can get, can really get passed so isn't that by insisting on that, that's not really a compromise.

PAUL: Well, see I mean there is an argument about when you compromise when it's right to compromise, when it's right to make a deal. We offered to come halfway in the sense that we offered to raise the debt ceiling.

But you know there were times in the 19th century when people were asked to compromise over many things that were just plain wrong. And I think sometimes it is good to stand up on principles for things you believe in and I also think it's best for America that we tried to balance our budget.

COOPER: But agreeing to pay our debt as a country, isn't that a moral position or moral obligation?

PAUL: Yes. I'm not saying we don't pay our debt. In fact, what I'm saying is this is going to increase our debt.

So we're at $14 Trillion, this will take us up above $16 trillion and that's adding to our debt.

COOPER: But we're still in this plan we're still cutting $2.5 trillion or so in debt.

PAUL: Yes. See, that gets into the whole talk about what we're cutting again. They're talking about cutting against a baseline that adds about 9 to $10 trillion so when you subtract two you're still adding seven so there's certain semantics to this argument that I think are lost on the American people a lot of times.

To my mind, I came out of the private world, I think if you spend more each year and add more debt you're not fixing your problem.

To put this in contrast, if you had a real cut, what would be a one percent real cut, we call it the penny plan, over about six years your cut one penny out of every dollar you would balance the budget. I just don't think that's that unreasonable.

COOPER: According to a multiple sources in a meeting with the Vice President Biden say Democrats were venting anger about Republicans saying they negotiate like terrorists.

What they're saying is that a small group of tea party Republicans, a powerful group were willing to hold the full faith and credit of the United States essentially, hostage. We're willing to risk the full faith and credit and not realize at a certain point, we're not getting what we want so we have to compromise.

Is that a fair criticism?

PAUL: Not really. Because I would say that some people who argue that by adding $2 trillion more in debt to our country that that threatens our country more than a temporary inconvenience of not raising the debt ceiling.

COOPER: Has this been a victory, you think, for the tea party?

PAUL: In some ways, yes. We didn't win the legislative battle. I didn't get what I want.

But I'd say that the public debate now, everyone comes up to me and says, whether they're with me or not, they say the debate now is all about cutting spending and before it was more about where are we going to go spend more pork barrel projects, where's the earmarks will go.

COOPER: Is there any scenario that you believe raising taxes on the wealthiest Americans which according to a lot of polls Americans seem to support, as part of a plan to get toward fiscal health, would you in any way, be able to vote for something like that down the road?

PAUL: I've been having this dialogue. We get painted as people who are not talking.

I talk with Democrats every day. In fact, the Democrats say that the rich need to pay more of their fair share. They need to bear more of the burden.

I can accept that premise. I think we could come together on that premise and then the question is how should they do it?

Should they do it by paying more taxes or maybe we can get the rich to pay more their fair share by saying they should pay more for their benefits. The reason we don't want to do it with the tax structure for the most part is we that think it will hurt job creation.

COOPER: Look at approval ratings of Congress people it's about as low as ratings of journalists and that's not very good. Is this a sign to you that this debate that we've seen as a sign that government works or doesn't work?

Because I think a lot of folks out there see this as a sign that government don't work but from your perspective on the inside.

PAUL: On the debt ceiling I would say there's that debate. Think how great it is that no one is shooting each other and you know the kind of story came back today

COOPER: That's the CNN Gabrielle Giffords

PAUL: Well, I mean, think about it compared to other countries where there's violence involved. People's freedom so express themselves is suppressed. Debate - we should never in our country complain about bickering because bickering is freedom of speech and I think you guys in the media really should I mean you guys really want to protect the first amendment and so do I.

That's what debate is about. It's first amendment expression. We won't always agree but we're not at each other's throats so to paint us as people unwilling to compromise or unwilling to work verse. I think that is just an improper caricature.

COOPER: Sir Paul, appreciate your time as always. Thank you.

PAUL: Thank you.


COOPER: And like more about the No votes out there joining me again Democratic Strategist Paul Begala and Eric Erickson editor and chief of

Paul, what do you think of Rand Paul?

PAUL BEGALA, DEMOCRATIC STRATEGIST: While he was speaking I think that illusion to the 19th century was probably slavery, don't you think?

So he's compares a fight over an artificial debt limit to probably the greatest sin in American history. I think that's a little much, at least for me and I was struck at how very different type of Republican we have in the Senate today.

Years ago, the leader was Everett Dirksen. In fact he Senate's building named after Senator Dirksen. He used to say, "I'm a man of fixed and unbending principals and the first of those is flexibility".

And that's how deals got down. That's how deal got done. That's the civil rights legislation got passed, with people like Eric Dirksen from a Republican party helping a democratic President Lyndon Johnson. That era seems long gone to me to hear Senator Paul speak. COOPER: Eric, it seems exciting. He was strolled crowned him last week wrote about saying that it's counter constitutional. The idea that you fight hard for what you believe in but at a certain point when you realize it's not going to happen you have to be willing to compromise. It does seem like there's a lot of folks now who believes compromise a dirty word.

ERICKSON: Yes. I really do think it depends on what you're compromising on. You can compromise on practicality. You can compromise on a lot of other issues but if you compromise your principles, why bother?

You know I think actually Jesse Helms who gave that great quote that if you think freedom is right and tyranny is wrong, why are people that supporting freedom bartering it away likes slices of baloney?

There are a lot of guys who really believe that and Rand Paul is one of them. He really does believe that we're going to a very bad place in this country economically and he wants to draw a line in the sand and say no further and you and I can disagree with him but he was convinced that we're going to a very bad place and keep spending.

COOPER: Paul, how does the tea party come out of all of this?

BEGALA: Enormous winners. I have to say, I'm scratching my head in amazement they don't seem to think they won. Although Senator Paul seems to think that they kind they did.

Look, in the last eight months since they won the November election in the House of Representatives, ever since they took control the house Represent, here's what happened.

A massive tax cut. I think way too targeted towards the rich but massive, $858 billion, bigger than the T.A.R.P. bailout the banks bigger than the Obama stimulus package but cutting taxes is clearly a tea party priority.

Then in April, the deal to keep the government functioning cut 35 to $38 billion from this year's budget so big spending cut. Now this massive $2 trillion spending cut plan, I think it's a route. I don't support their agenda. But if it's cutting taxes and spending, good Lord, this thing is a route. We haven't seen the Democrats get a penny of taxes even from oil companies.

COOPER: Eric, you agree with that?

ERICKSON: Not necessarily. I mean Paul makes a very good case to I guess enrage the democratic base and maybe make the Republicans feel good but I'd point out the those tax cuts that Paul is talking about they were extended by a fully democratic Congress with a democratic president with a Republican minority in the house and Senate.

But at the same time these tea party activists, they don't feel like they've won because they look at this picture and they'll really do believe that we're headed down the wrong road and say if this plan goes according to design, Anderson, and that's the frustrating part for all of us "by design" we'll add $12 trillion.

We won't scale back government. They don't view that as a victory.

COOPER: Eric Erickson, Paul Begala, guy thanks for staying up. Appreciate it.

Coming up, all the bitterness on the house floor stopped for one really inspiring and touching moment today to welcome Representative Gabby Giffords.

Giffords returned to the house today for the first time since she was shot in the head seven months ago. I spoke with her friend and colleague, Debbie Wasserman Schultz, that is her actually standing next to her, you can't quite see but she'll give us a behind-the- scenes look a power this game all about.

Also, Isha Sesay is following another story for us tonight. Isha?

ISHA SESAY, CNN CORRESPONDENT: Anderson, new deadly violence in Syria is the target is the City of Hama. This video reportedly shows the city on the fire by series of (inaudible) reporters.

Reports at least 52 people dead including four children, that and much more when 360 continue.


COOPER: It was just an incredibly inspiring moment and really touching on the house floor today. They had nothing to do with the vote that was happening and really put the whole vote in perspective or the debate that's been so contentious.

A moment, there was not about politics but a person. The moment was when Representative Gabby Giffords returns to the house floor for the first time since she was shot on that dark day back in January.

She was welcomed back and applause, a lot of applause. Listen!


COOPER: She looked great. House Minority Leader Nancy Pelosi calls Giffords the per son occasion of courage. And she is remarkable to think and it was seven months ago. Giffords was shot in the head in Arizona, fighting for her life in intensive care.

She has a long way to go in her recovery. She wasn't moving the right side of her body and still has trouble standing and speaking more than short phrases.

Seeing her today on the floor was a bill milestone. And we know the return was temporary. This is a triumph for her family and her and her friends. Her friend and colleague, Debbie Wasserman Schultz helps her into the house, you see her on the left, that's her husband on the right, Mark Kelly.

I spoke with Congresswoman Wasserman Schultz a short time ago. (BEGIN VIDEOTAPE)

COOPER: Just a remarkable moment today. You know midst all these bickering to have a moment like this and to see Congresswoman Giffords there.

She's obviously incredibly close friend of yours, what was it like for you to have her on the floor?


You know when I got the call from Mark last night that Gabby had been following the negotiations and wanted to be able to be in the chamber to cast her vote, if it was pivotal, she wanted to make sure that she could help stave country from default and make sure that she was there on the most important vote that we'll are probably cast this Congress for her constituents. It was the most overwhelming.

I mean it would be hard -- my heart -- all of our hearts were so full. And you've had some grizzled hardened members with very hardened hearts that everybody just melted when she walked in the chamber. It was so incredible.

COOPER: So you found out, what, yesterday, last night?

WASSERMAN SCHULTZ: Yes. Mark called me last night and told me that Gabby had been following the debate and really felt that it was important to be there to make sure that - especially if she would in deciding vote, save the country from default and then she decided that it was important for her to cast her vote and make sure her district had a voice in the chamber something this important.

COOPER: How is she doing? I mean she looks good, she looks strong. She looked, you know -- I mean, she looked like she belonged there.

WASSERMAN SCHULTZ: Exactly. She's doing incredibly well. This is the most determined, focused, hard-working person we've said for months. Months ago I said that she would make a triumphant return to the chamber and today she did.

And, you know, she got a long way to go in her recovery. She still has to work and rehabilitation so she's not ready to come back fulltime but this was an incredible step for her and a fantastic day. You know and in an otherwise tough few weeks.

So Gabby Giffords is the consummate public service and her district is fortunate as she set the example today for having her represent them.

COOPER: So, I mean that you answered next question and final question really which is -- this is not for good. She's not back for good.

WASSERMAN SCHULTZ: No. She's got a lot of work left to do to continue on the road to recovery but she's making remarkable progress. She's very determined to come back and I've been able to visit with her a whole bunch since the shooting. She's made more and more progress each time. It's amazing that America got to see and her colleagues and constituents got to see how much progress she's made.

It was something that after such a tough debate, after so much was at stake for us to have Gabby melt our hearts a little bit so we can move on and hopefully, start to work together a little bit better.

COOPER: It was certainly one of those moments in the newsroom where everyone just stopped and I'm sure the same thing on the floor of the house and kind of put things in perspective.

WASSERMAN SCHULTZ: Really, it does. You should have seen -- I was watching the members faces as I was helping to walk Gabby into the chamber and it was just you know jaws dropping and smiles and tears and just -- it was -- I think it was a shot in the arm that the Congress and the house needed - the shot in the arm that the Congress and the house needed after a very tough time.

We got a lot in front of us and a lot of work ahead of us, hopefully Gabby's return today, even if it's just brief, will help us all come together. That's the civility that I know is so important to her and hopefully, her return sets the tone.

COOPER: I hope she got a sense of the out poring and I hope it gave her a shot in the arm as it did everyone else.

WASSERMAN SCHULTZ: She did. She thought it was incredible.

COOPER: Appreciate your time. Thank you.



COOPER: Still ahead, new brutality in Syria.

At least 52 people, including four children, killed yesterday by the government. Military accused of firing on its own people, even as they try to pull victims to safety. We've seen this before frankly.

Also, ahead judge ordering Casey Anthony to return to Orlando, I will tell you why.


COOPER: In Syria, a bloody 48 hours as President Bashar al-Assad escalates his crackdown and demonstrator in the city of Hama, a major target.

Take a look.



COOPER: Video reporting to show Hama under fire by certain security forces yesterday. Amnesty International said at least 52 people including four children were killed. Dozens more reportedly died in other attacks across the country. Hospitals are said to be overwhelmed.

Video, it was people outside one of them with foreign journalist barred from Syria. We can't independently confirm the reports.


There's another video also reportedly shot on Hama group of man trying to recover a wounded man on the street and appear to come under gunfire.

Watch this.



COOPER: Keep in mind this is the holy month of Ramadan. Today in Hama there were reports of machine guns firing from tanks and at least six more people were killed according to one human rights group.

This video of the tank was purportedly shot on the outskirts of the city of Hama.


COOPER: The President Obama called the attacks on demonstrators horrifying.

Secretary of State Clinton demanded that President Bashar al-Assad stop the slaughter now!

There's a lot of happening tonight. Isha Sesay joins us on the 360 news and business Bulletin. Isha.

ISHA SESAY, CNN CORRESPONDENT: Anderson, it looks like the Casey Anthony saga isn't over yet. Judge in Florida says that Anthony has to come back to Orlando to serve year probation on her check fraud conviction.

There's apparently some confusion about whether that judge intended to Anthony to serve her probation while she was in jail waiting for her murder trial.

Anthony's attorney may challenge the move.

(INAUDIBLE) in California say they'll go for the death penalty against the suspect in the so-called "Grim Sleeper" serial killing.

Lonnie David Franklin got the nickname because there was a long gap in between his alleged crimes.

Franklin is charged with murdering ten women between 1985 and 2007.

Ford is recalling more than a million pickup trucks because of the fuel tank problem this truck can rust. That can possibly loosen the tank and let it drive on the ground. The recall covers the F-150 model from 1997 through 2003 and from F- 250's 1997 through 1999.

But I have to say, I have to say right now, I am actually more concern about this particular vehicular problem. Try to imagine this.

When I driving on a high way and suddenly a snake fizzes out from under the hood and yes, can you see this?

"It falls on the wind shield" and this is what happens when in family, mom was driving. Dad goes out his camera phone before the snake finally fell off.


SESAY: Yes. That was dad did. He goes to his camera phone now.

COOPER: They could have pulled over.

SESAY: I would be expecting you to be more useful if you were in that situation.

COOPER: I'm not judging but they could pull over and let the snake take off maybe. It looks like a harmful snake.

SESAY: Really? It was sliding with a snake hair?

COOPER: My first pet was a snake. His name was Sam. But I have a speech problem I would say, Tham.



SESAY: And you fooled me, you never looked it in the eye.

COOPER: I really do now.

SESAY: How would I know?


COOPER: I prefer this means fornication for a ducks.


SESAY: But I feel you even from here.

COOPER: Yes. It's nowhere to sigh. I can talk to people like this. I need to have this camera phone at me at all times. That way I can talk to people. Anyway.

SESAY: So troubling, facial phrases on your tweets and the strange man Anderson cooper on your screen.

COOPER: How I ended up on TV? I have no idea. It's good to have you back.

SESAY: Thank you. Good to see you.

COOPER: Tomorrow, we'll find out where you have been. You're many journeys.

SESAY: I will share with Isha. Tomorrow night, tune in.

COOPER: All right. A lot more ahead tonight including the house bill and the debt deal.

Gabby - Gabrielle Giffords' breathe taking returns in forum.

Be right back.