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EARLY START

GOP Obamacare Repeal Bill Fails in Dramatic Vote; Chaos and Infighting at White House; Ravens Consider Signing Colin Kaepernick. Aired 5-5:30a ET

Aired July 28, 2017 - 05:00   ET

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


ANNOUNCER: This is CNN breaking news.

(BEGIN VIDEO CLIP)

SEN. MITCH MCCONNELL (R-KY), MAJORITY LEADER: This is, you know, clearly a disappointing moment.

(END VIDEO CLIP)

DAVE BRIGGS, CNN ANCHOR: In one of the most dramatic moments you'll see, Republican efforts to repeal Obamacare have died. An early morning vote in the Senate came down to one single vote -- John McCain -- with the moment Democrats and Republicans will not soon forget.

[05:00:06] We have you covered across Washington this morning.

Good morning, everyone, and welcome to EARLY START, on the huge day in this country. I'm Dave Briggs.

CHRISTINE ROMANS, CNN ANCHOR: Yes. Not just your average Friday. I'm Christine Romans.

BRIGGS: No.

ROMANS: It is 5:00 a.m. in the East.

High drama on Capitol Hill stretching into the wee hours this morning. Senate Republicans trying to repeal and replace Obamacare. And that vote coming up short when the maverick made his mark. Senator John McCain just days removed from his cancer diagnosis stunning the chamber, turning thumbs down on the repeal bill. It happened just feet away from Republican Leader Mitch McConnell, prompting an audible gasp in the chamber.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: No.

(END VIDEO CLIP)

BRIGGS: Seven years of repeal efforts have now essentially gone up in smoke leaving a frustrated Mitch McConnell to explain on the Senate floor.

(BEGIN VIDEO CLIP)

MCCONNELL: I and many of my colleagues did as we promised and voted to repeal this failed law. We told our constituents we would vote that way, and when the moment came, when the moment came, most of us did.

(END VIDEO CLIP)

BRIGGS: Two other Republican senators, Maine's Susan Collins and Alaska's Lisa Murkowski, joined McCain, crossing party lines to vote against the repeal bill.

So, how did this go down behind the scenes? Where do GOP leaders go from here?

Let's go live to CNN's Phil Mattingly on Capitol Hill.

Good morning to you, Phil. How did this go down late last night and early this morning?

PHIL MATTINGLY, CNN CONGRESSIONAL CORRESPONDENT: Yes, certainly an amazing moment. To get context from the video you saw, Senator McCain voting no. Those gasps and that shuffling you heard were reporters sprinting out of the chamber where you can't have cell phones. That's how surprised everybody was that this occurred.

Now, keep in mind, sources had been saying that it was possible that Senator McCain was leaning leading up to this vote. But Senate Majority Leader Mitch McConnell, Vice President Mike Pence, and, guys, at one point, Vice President Mike Pence handing his phone to John McCain. On the other end, President Trump trying to sway the senator. In the end, it simply wouldn't work.

Take a listen to what leaders from both sides had to say after the vote.

(BEGIN VIDEO CLIP)

MCCONNELL: Now, I imagine many of our colleagues on the other side are celebrating -- probably pretty happy about all this. Our friends on the other side decided early on that they didn't want to engage with us in a serious way, in a serious way, to help those suffering under Obamacare.

SEN. CHUCK SCHUMER (D-NY), MINORITY LEADER: It's time to turn the page. I would say to my dear friend, the majority leader, we are not celebrating. We are relieved that millions and millions of people who would have been so drastically hurt by the three proposals put forward will at least retain their health care.

(END VIDEO CLIP)

MATTINGLY: And, guys, shortly after the vote, the president taking to Twitter to tweet: 3 Republicans and 48 Democrats let the American people down. As I said from the beginning, let Obamacare implode. Then deal. Watch. Now, Senator McCain was joined by Senator Susan Collins of Maine and

Senator Lisa Murkowski of Alaska voting no. Those two senators voting against everything throughout this process. So, that wasn't the big surprise.

The surprise, most certainly, McCain. And let's track back how this all actually happened. Senate leaders have been paring back what they were actually voting on for days now, essentially ending one a bare- bones repeal proposal.

The big concern I heard repeatedly yesterday from Republican senators, even those who were clear questions, is that the bare-bones proposal would eventually be voted into law. The entire idea behind voting for this proposal would be to send it to a conference with the House.

Now, early -- late in the afternoon, Senator McCain joined several senators in having a press conference and saying, look, we will support this idea, but we're not going to vote for it unless we have assurances from House Speaker Paul Ryan that they won't just pass the bill. Well, they got those assurances both in a statement where the speaker said the House was willing to go to conference, and in personal phone calls from the speaker himself. In the end, it wasn't enough for McCain. McCain telling reporters afterwards that the vote was just the right thing to do.

But again, in a statement after the vote, making very clear that he was uncomfortable that at some point this bare-bones plan could actually become the plan. And just to give you a sense of the frustration, you heard from Senator McConnell the frustration that he had on this. After this vote was over, the next bill that was supposed to be taken up, the National Defense Authorization Act, that is Senator McCain's bill. That I'm told is the primary reason that he came back to Capitol Hill before his cancer treatment begins next week.

Senator Rand Paul objected to taking up that bill at all, which was a really big moment, a moment that surprised staff, surprised fellow senators. As of now, the Senate has adjourned. They're not coming back until next week. It's unclear what Senator McCain is going to do next, guys.

[05:05:01] ROMANS: You know, clearly, Phil, there's some hurt feelings on the floor there. But they had seven years of promises, seven years of promises to repeal and replace Obamacare. In the end, Senator McCain said we have a shell here. We don't have anything to replace Obamacare.

MATTINGLY: Yes, look, I think this is a really, really important point to explain what just happened. This is something we've seen play out over weeks right now. The big concern from Senator McCain and other senators who -- even those who are willing to move this into conference -- is that Senate Republicans would never be able to coalesce around a repeal and replace proposal. They weren't able to demonstrate they could get 50 votes on anything, anything.

And so, this idea let's just keep moving the process along. Well, at some point, someone's going to have to make tough decisions. And the idea that they wouldn't be able to coalesce around any proposal made the possibility that this skinny repeal could actually become law. That was the driving force behind McCain's no vote. That was the driving force behind a lot of concerns. Really that's been the driving force behind multiple failures throughout this process.

Republicans are ideologically divided on health care. And it became clear early this morning they aren't able to bridge the divide, guys.

MATTINGLY: A lot of attention on John McCain and for good reason. But, Phil, you have some interesting reporting on Lisa Murkowski of Alaska and how the process played out between her and the White House.

MATTINGLY: Yes, look, the White House was doing everything they could in the latter stages of this debate to try and get senators there. As I note, Lisa Murkowski was a no on the motion to proceed to debate. She's been a no on all of these amendments. She has very specific concerns about a state that this bill would dramatically impact, any proposal would dramatically impact Alaska and had laid concerns out to leadership.

What the administration was trying to do to get her there -- well, that might not have been effective. The president tweeting at her earlier in the week, and we're told that the interior secretary, Ryan Zinke, obviously, no relationship with health care at all, called both Dan Sullivan -- Lisa Murkowski's colleague in Alaska -- and Lisa Murkowski, and informed them that Lisa Murkowski's vote on the motion to proceed was dangerous for the relationship between the Trump administration and Alaska, the state itself.

Now, guys, a little context here for Lisa Murkowski. She's a senator who won a write-in campaign in 2010 after she lost to the Republican primary. She doesn't feel like she owes the Republican Party anyway. She's known as an independent senator. She's known as somebody who cares about Alaska and is not kind of a party-only person.

And another kind of keynote that I've been getting a kick out of for the last 24 hours since we found about this, she chairs the committee that in part oversees the Interior Department and Secretary Ryan Zinke who will have to listen to her repeatedly. So, whether or not this was a great strategy, it certainly didn't help, it's unclear if it hurt.

But, guys, it's worth noting -- administrations do this, they try and pull all the levers they can to try to get senators into play. But in this situation, it was clear that this wasn't a helpful effort.

BRIGGS: All right. Phil, we are efforting you several pots of coffee. Good luck to you. Thank you for being with us. We'll check in with you at 5:30.

ROMANS: I don't feel bad for him. He loves this. He loves. That was really -- he was in history last night. Part of history.

Let's discuss this now with Kimberly Leonard, senior health policy reporter for "The Washington Examiner", and David Drucker, CNN political analyst and senior congressional correspondent for "The Washington examiner."

All right. So, let's talk health policy first, Kimberly.

This was a shell meant to keep the process moving. As you heard Phil Mattingly say, at some point, tough decisions have to be made about how to have better health care in this country. And there just is not agreement. There still is not agreement.

KIMBERLY LEONARD, SENIOR HEALTH POLICY REPORTER, THE WASHINGTON EXAMINER: That's right. And in the end, that really led to part of the downfall. What does a replacement plan look like? Ultimately, every alternative they came up with appeared to increase premiums, increase the number of people who would be uninsured. And when people see those numbers, they may not like Obamacare, but they don't like what they're seeing to replace it even more. And so, politically, it's very difficult to get past that.

BRIGGS: All right. So, the president tweeting early this morning, let Obamacare implode. The question is, will it?

LEONARD: Well, if they were to do nothing, the exchanges where people buy private insurance that people who don't get insurance through the government or through their employer, those will face a lot of difficulty if they do nothing. They already are facing a lot of trouble.

So, it does seem that in the next couple of months, members of both parties will need to work together to come up with some rescue package. Perhaps a reinsurance package that would inject more federal funding into them or perhaps lifting some of the taxes that are created under Obamacare. It's definitely something that we expect to see if they're sincere about working together.

ROMANS: I'm going to be interested to see how the White House directs health and human services to implement the open enrollment period and, you know, collecting of the fines and fees and doling out of the subsidies, Kimberly, because that really is now -- Obamacare is still the law of the land here. And it looks as though the repeal effort is dead.

LEONARD: Well, that's right. There are also things that the Department of Health and Human Services can do to make things easier for people buying insurance off the exchange.

[05:10:06] So, for example, in Alaska, Health and Human Services funded a big reinsurance package that really allowed premiums to not increase so much. Last year -- Alaska is a big state. It has few residents. It was going to face massive premium hikes. But because it set up a reinsurance program that the Department of Health and Human Services accepted, they were able to see lower rates in the state.

So, the question is how will it work with states to allow more flexibility so they can implement systems that are less expensive and perhaps give people better access. BRIGGS: All right. Before we get to the politics of this with David,

Kimberly, as many fears on the far right as there are hopes on the far left that this leads to a single-payer system, are we a step closer to that?

LEONARD: Well, it's difficult to say. Again, when it comes down to it, a lot of people are comparing the status quo to what it could be replaced with. They're seeing stories in other countries where access might be more limited, where wait lines might be longer and things like that. And they're saying, I'm not sure that I want a single- payer system. Is there a way to maybe integrate the private market with the public market and have things work a little bit better.

There is some public support for it, but it comes with conditions. Usually when you tell people how much their taxes will go up, how much federal funding will go up, they're a little bit less willing to support these proposals.

ROMANS: All right. David Drucker, let me bring you in and talk about the politics of this. I mean, that moment last night with John McCain gave the thumbs down, and you see he's right -- Mitch McConnell standing right there at the corner of the desk. And he literally thumbs down, turns his back, turns his back on his colleague, gasps in the room.

After the vote, here's what Mitch McConnell said.

(BEGIN VIDEO CLIP)

MCCONNELL: So, I regret that we're here. But I want to say again, I'm proud of the vote I cast tonight, is consistent with what we told the American people we'd try to accomplish in four straight elections, if they gave us a chance.

(END VIDEO CLIP)

ROMANS: Now, for those of us who know Mitch McConnell, you can tell he is seething there as he is saying those words, what we tried to accomplish in four straight elections. I would play devil's advocate and say, four straight elections? Yes, you should have had a plan.

DAVID DRUCKER, CNN POLITICAL ANALYST: Well, I think the problem was there were too many plans and they couldn't get to a consensus.

ROMANS: OK.

DRUCKER: But I think the focus and clip you pulled is the perfect clip, because the reason Republicans were trying so hard to pass a bill, in fact, multiple bills that polling has shown are very unpopular with policies that people don't quite understand is because the political ramifications for not getting this done according to the Republican strategists I talked to are huge. They tell me it's worse than anything they fear over Donald Trump's tweets, over the president's chaotic leadership style.

What do they fear most? That they're going to head into the midterm elections a year from now, and with control of all levers of government have nothing big to show for it. And so, the gambit was we have to try and do something about health care, and we have to try and fulfill this promise no matter what people think of it today, because if we show up empty-handed in 2018, our base is going to say, what's the point? I got better things to do on Election Day.

ROMANS: Unless they get tax cuts -- I mean, if they had middle-class tax cuts. That would be something to show for it. Should they have done tax reform first?

DRUCKER: No, I don't think so. I think tax reform is going to be very difficult. This idea that tax reform is going to be easier than health care, they should have done that first, they should have done infrastructure first, look, hindsight's 20/20. But I can tell you, Christine, tax reform requires a lot of tough choices and a lot of tough votes. It doesn't mean they can't get it done. I think this seriously gets in the way of that.

ROMANS: Wow.

BRIGGS: You know, there's a lot of talk about 2018. But will the Democrats be able to run on a better deal? So, I think that's a long way off. But in the short term, here's how Ted Cruz summed up what this means for his party after the no vote.

(BEGIN VIDEO CLIP)

SEN. TED CRUZ (R), TEXAS: If you stand up and campaign and say we're going to repeal Obamacare and you vote for Obamacare, those are not consistent. The American people are entirely justified in saying any politician told me that and voted the other way didn't tell me the truth. They lied to me.

(END VIDEO CLIP)

BRIGGS: Ted Cruz clearly disappointed. As they've continued this effort, Obamacare has gotten increasingly more popular, now polling at 50 percent.

But, David, let's talk about the entire Trump administration and agenda. Look at the last 24 hours, you have covers of newspapers that read like a reality show, with the infighting there.

[05:15:01] You have Russian sanctions bill that passed 98-2 in the Senate after overwhelmingly passing the House. They now head to the president's desk. And you have Republicans saying there will be no recess appointment if in fact you fire Attorney General Jeff Sessions. What does this mean for the Trump administration?

DRUCKER: It means they have to get their act together. Look, Republicans in Congress deserve a lot of blame that they're going to get for not being able to get the Obamacare repeal bill done. By the way, there are a lot of problems with health care, letting it implode is going to be another political problem for them. They have to do something. However, the X factor in all of this is supposed to be presidential

leadership. The reason you want a White House is because a White House with a sort of national base can corral competing voices of your party in Congress and even the other party to produce legislation. And the Trump administration has fallen down on the job in doing this. And primarily because of the president himself, he's been so busy defending his brand and presiding and, in fact, encouraging a chaotic, chaotic leadership that I think would make a reality show look tame.

That it's not surprising that Republicans would end up where they are here. The president himself was always on five sides of the issue -- let it implode, fix it, it's too mean, let's just do straight repeal, let's make it, you know, expansive and generous.

ROMANS: Yes.

DRUCKER: That's not a way to get legislation like this done. And I think the president has to rethink how he -- how he tries to negotiate and close legislative deals. It's not the same as a real estate deal, as an entertainment deal. Successful as he was in that world, this is different.

ROMANS: Something else that's different, open warfare in the White House, in the West Wing. This Anthony Scaramucci calling up Ryan Lizza at the "New Yorker" and unloading on Reince Priebus in the most derogatory way, all out there for the world to see. What do you make of this?

DRUCKER: I got home last night, I asked my wife, did you hear what Scaramucci said? She said, no, what did he say? I said, our 5-year- old's still awake, I can't tell you. Go read it.

And this is part of the problem the president has. In the middle of trying to get this health care bill across the finish line yesterday, one of the biggest days for Republicans since the president took office, the administration is consumed with their so-called communications director --

ROMANS: Yes.

DRUCKER: -- going after the chief of staff and the chief strategist in a very open way, bringing attention to himself and the White House in a way that is not helpful to the agenda, that Anthony Scaramucci was brought in to try and help. That he says he wants to help, and I'm sure he does want to help. It was just very counterproductive.

And let's not -- Dave, you brought up a good point about the sanctions bill. This is the first time since 1986 that a president on foreign policy has been so rebuked by Congress. When President Reagan was overridden on the South African sanctions bill, here you have a Congress and Republicans in Congress telling President Trump we don't trust your Russia policy, we don't have confidence in you to deal with Vladimir Putin. So, anything you want to do with him in terms of relaxing sanctions, you got to run it by us first.

BRIGGS: Through us. ROMANS: Yes. Interesting.

BRIGGS: And Scaramucci saying to Chris Cuomo that they might, in fact, negotiate tougher sanctions on Russia. That's why they might repeal it. That met with a collective laughter throughout both --

DRUCKER: I think that was probably funnier than anything else I heard all day. That's saying something.

ROMANS: Well, the thing about that, you know, he was on with Chris Cuomo for a half hour yesterday, on a day when they should have been taking a victory lap over the Foxconn $10 million deal in Wisconsin --

BRIGGS: Or pushing health care --

ROMANS: That should have been the message if they wanted to do winning -- you're going to be tired of winning. But it wasn't. It was about leaking.

So, the communications director missed a moment there, missed a real moment there.

BRIGGS: Instead, we're opening "The New York Times" and seeing the "F" word printed in the "A" section. This is not normal times.

David Drucker, Kimberly Leonard, sorry to leave it there. We'll check back in 20 minutes to get more on this.

ROMANS: Yes.

BRIGGS: Next, the attorney general speaking out. What does he have to say about the president's week of cyber taunts?

(COMMERCIAL BREAK)

[05:23:33] ROMANS: Welcome back.

Jeff Sessions speaking publicly for the first since President Trump began targeting him with a barrage of critical tweets. The attorney general standing by his decision to recuse himself from the Russia investigation, but he admits the relentless battering from his boss stings.

(BEGIN VIDEO CLIP)

JEFF SESSIONS, ATTORNEY GENERAL: Well, it's kind of hurtful, but the president of the United States is a strong leader. He is -- he's had a lot of criticisms, and he's steadfastly determined to get his job done. And he wants all of us to do our jobs, and that's what I intend to do.

TUCKER CARLSON, FOX NEWS HOST: He has said again and again in many different forms throughout this barrage that you should have acted differently, you should have not recused yourself.

SESSIONS: I talked to experts and Department of Justice people who are trained in that, I'm confident that I made the right decision.

(END VIDEO CLIP)

BRIGGS: Now, Sessions says he believes the Justice Department is making tremendous progress. But he acknowledges he serves at the pleasure of the president and will step down if his boss wants to make a change. But Republican Chuck Grassley, the chairman of the Senate judiciary committee, is warning the president he will not hold hearings for a successor to Sessions in 2017.

And Senator Lindsey Graham cautioning the president there will be, quote, holy hell to pay if he fires the attorney general.

ROMANS: Bye-bye, border adjustment tax. After months of fierce wrangling, the most controversial element of tax reform is officially dead as a doornail.

[05:25:03] The so-called "Big Six" who are negotiating tax reform released the principles of the GOP plan. The group includes Treasury Secretary Mnuchin, economic director Gary Cohn, House Speaker Paul Ryan, and Senate Majority Leader Mitch McConnell.

Now, this is still a wish list for tax cuts and lacks any real detail save for one -- the border adjustment tax is out. It was championed by Paul Ryan. It changes the way we tax U.S. imports and exports. It gives tax breaks to companies that export and strips away breaks from companies that import.

It has two goals -- to encourage manufacturing in the U.S. but companies that rely on imports warn it will jack up consumer prices. And, by the way, Americans love cheap goods.

Second, the other goal, to raise tax revenue. The current plan has $1.2 trillion worth of tax cuts. Without the border adjustment tax, it's not clear what will pay for it.

Now, the administration says the plan will pay for itself, reform will spur 4 percent economic growth. A lot of experts are skeptical on that rate. They're expecting slower 1.8 percent growth. But the border adjustment tax reviled by the retailers is out.

BRIGGS: A big loss for Paul Ryan in particular there.

Well, as NFL teams begin training camp, big question remains -- will Colin Kaepernick play at all this NFL season?

ROMANS: Andy Scholes has more in this morning's "Bleacher Report."

Hey, Andy.

ANDY SCHOLES, CNN SPORTS CORRESPONDENT: Good morning, guys.

You know, Colin Kaepernick has had just one tryout this entire offseason. He remains unsigned. Many believe he's being black balled by teams due to his protest and not standing during the national anthem last season. One thing that is interesting Kaepernick is the Baltimore Ravens.

Their Coach John Harbaugh said he's been talking to the free agent. The Ravens could be in the market for a starting quarterback with Joe Flacco reportedly sidelined for three to six weeks because of a back injury.

Now, Kaepernick plays for Harbaugh's brother Jim with San Francisco's 49ers. And Joe coached against Kaepernick and Niners in Super Bowl 47.

(BEGIN VIDEO CLIP)

JOHN HARBAUGH, BALTIMORE RAVENS HEAD COACH: Not ruled out at all. I mean, he's a really good football player. I believe he's a really good person. It depends on a lot of things -- depends on Colin, first of all, what he wants to do. What's his passion, his priority, what's he want to do. What kind of shape he's in, you know? He's ready to go and our needs. We'll see where it goes.

(END VIDEO CLIP)

SCHOLES: Now, Ravens reportedly signed Arena League quarterback David Olsen last night to help with training camp but his signing does not rule out Kaepernick joining the Ravens.

In the meantime, Ravens' offensive lineman John Urschel walking away from the NFL. He's just 26 years old. Now, Urschel is a math wiz. He's currently working on this doctorate at MIT, setting spectral graph theory, numerical linear algebra and machine learning. Wow.

Now, Urschel said in a statement that he will be on campus this fall taking classes and getting ready to be a dad. He and his fiancee are expecting their first child this December.

All right. Finally, Yankee superstar Aaron Judge will likely be visiting the dentist in the near future. The Yankees won in a walk- off home run in the 11th inning. And during the celebration, watch judge right there -- that helmet hits him right in the mouth. You could see -- if you look closely, a piece of his tooth go flying.

Judge left the field before anyone else, and then later, Yankees' beat reporter Bryan Hoch tweeted this picture of security apparently looking for Judge's tooth. And, guys, this reminds me of -- I'm a Rockets fan.

Back in 2000, Steve Francis in his prime, got his tooth chipped. And a fan court side picked it up, tried to put it on eBay and sell it. It was going for over $1,000 before it was pulled off. It makes me wonder, how much would someone pay for a piece of Aaron judge's tooth?

BRIGGS: You know, probably thousands of dollars. I would guess. With the talent he's shown thus far this season, I might get in on the bidding.

SCHOLES: One of a kind.

BRIGGS: Andy Scholes, thank you, my friend.

ROMANS: Glue that little thing back on.

All right. Twenty-eight minutes past the hour. EARLY START continues right now.

(MUSIC)

ANNOUNCER: This is CNN breaking news.

(BEGIN VIDEO CLIP)

MCCONNELL: This is, you know, clearly a disappointing moment.

(END VIDEO CLIP)

ROMANS: This dramatic moment. A thumbs down, crystallizing a stunning night on Capitol Hill. Republicans' efforts to repeal Obamacare failed. The vote came just hours ago. John McCain's deciding vote left lawmakers and the country stunned.

We have the vote covered across Washington this morning.

Welcome back, everyone, to EARLY START. Big morning here. I'm Christine Romans.

BRIGGS: I'm Dave Briggs. A day Republicans and Democrats will not soon forget.

Some high drama on Capitol Hill stretching into the wee hours of the morning. Senate Republicans trying to repeal and replace Obamacare, and that vote coming up short when the maverick made his mark. Senator John McCain days removed from his cancer diagnosis, stunning the chamber, turning the thumbs down on the repeal bill. It happened just feet away from Republican Leader Mitch McConnell prompting an audible gasp in the chamber.

(BEGIN VIDEO CLIP)

MCCAIN: No.

(END VIDEO CLIP)

ROMANS: Seven years of repeal efforts have essentially gone up in smoke leaving a frustrated McConnell to explain on the floor.