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INSIDE POLITICS

Congress To Approve $8 Billion For Victims Of Harvey. Aired 12:30-1p ET

Aired September 4, 2017 - 12:30   ET

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


(COMMERCIAL BREAK)

[12:32:09] JOHN KING, INSIDE POLITICS HOST: Welcome back. Congress returns tomorrow after its summer recess with a long list of things to do. But not much time to do them. At the top of that list, money for victims of Hurricane Harvey.

President Trump has asked Congress to quickly approve nearly $8 billion. That's the first installment. Most of that would go to FEMA's disaster relief fund. It's a just a down payment on a bill that eventually could surpass $100 billion.

Now, there's bipartisan support for relief funding. Yesterday, the Treasury Secretary, Steve Mnuchin said he wants to attach it to a much more controversial item that would lift the government's debt ceiling.

(BEGIN VIDEO CLIP)

STEVE MNUCHIN, TREASURY SECRETARY: The President and I believe that it should be tied to the Harvey funding that our first priority is to make sure that the state gets money. It is critical. And to do that we need to make sure we raise the debt limit. So, if we -- if Congress appropriates the money, but I don't have the ability to borrow more money and pay for it, we're not going to be able to get that money to the state.

(END VIDEO CLIP)

KING: How much more money are we talking about? The Texas Governor Greg Abbott says it could easily be the most expensive natural disaster in American history.

(BEGIN VIDEO CLIP)

GOV. GREG ABBOTT (R), TEXAS: The population size and geographic size is far larger than Katrina. And I think Sandy combined. We have over 5 million people who are affected by this. It's not just the flooding in Houston. It's the hurricane swath all the way from Corpus Christi over to Beaumont. And so, it's going to require even more than what was funded for Katrina, which was about $120 billion.

(END VIDEO CLIP)

KING: Now, is Congress prepared for that? That seems no question, Dave (ph), and we have a vote scheduled I think right way tomorrow, right. Tomorrow morning the House is going to get started on the first installment which is just short of $8 billion. I don't think there's any disagreement. They'll move quickly on that.

But when you get to that bigger question there, the bigger question, you already have Mark Walker Republican of North Carolina, one of the Conservative saying, yes, our obligation is to assist those impacted by this great flood. But it's past time, the swamp waters in D.C. begin receding as well. That's starts with being both compassionate and fiscally responsible. These two principles are not at odds.

What the Congressman is saying there, and you'll have many friends, and one of them used to be the current Trump Budget Director Mick Mulvaney, who used to insist. Of course we have emergency aid to help in these situations. But for spending $50 billion here, we got to cut it somewhere else. What's going to happen?

UNIDENTIFIED FEMALE: You know, it's interesting you bring up that quote. I was talking to a Republican from Texas. Not a Freedom Caucus member at all. But he was saying, you know, these two issues should be separate. So you're not only going to see Conservatives talking about combining the debt ceiling and Harvey money. You're also going to see Texans who don't want to do this.

And Republicans in particular who want to vote for this emergency package. But they don't want to vote for a debt ceiling. And they're going to be ticked if they get, you know, jammed on this. They're going to feel jammed. But it sounds like my leadership sources are say that's what they're going to do.

KING: And that's a switch from the administration to have the Treasury Secretary say that because both the President and I believe it was FEMA director said last week, we want these things to be separate.

[12:35:05] UNIDENTIFIED FEMALE: We'll, I think in the House that that's certainly true. And I think as the White House did its homework on this idea, they came to realize pretty quickly, the Senate is the most likely place for these two to be coupled if that indeed ends up being what happens. I actually think, you know, look, when you look at something like DACA plus the wall, that's like interesting, but a controversial move. You can see how it could go off the rails. This is really different. This is not the White House trying to hold Harvey aid hostage in order to get a debt ceiling increase.

This is the White House assuming that there are Republicans who understand they need to raise the debt ceiling. But they need some political cover to do it. And this gives them a way to do it. And it gives everybody else a way to say, the debt ceiling is an unpopular vote to rise. But you have to raise it. Harvey is something everyone wants to vote for. I actually think this is not --

KING: You just made a lot -- very logical argument.

UNIDENTIFIED FEMALE: Yes. KING: This happens to be Washington D.C., though. And you can ask the former speaker, John Boehner and the current speaker, Paul Ryan. The debt ceiling in recent years has become quicksand. A quagmire for Republicans for the very point that fiscal Conservatives and this is what they ran on. So, a lot of people rolled their eyes at them. But they say, you know, I said, I said if I came to Washington, if we're take it all here, we're going to cut it here. You know, we have to do this. And this has become a quagmire.

UNIDENTIFIED FEMALE: Yes.

KING: The question is, is the bipartisanship at least for the first installment of Harvey enough to get through there?

UNIDENTIFIED MALE: That's where the -- I think that that's the big question of the cuts to this. And you're already seeing that play out internally within the party where people like Peter King are criticizing Ted Cruz and John Cornyn for -- when Hurricane Sandy hit, they insisted on cuts and voted against it because those cuts didn't exist. Now, they're kind of playing it in a different way trying to protect their home state. So that's going to be the debate that plays out.

KING: And this came up earlier. And this is a conversation again, the real America. They roll their eyes at those of us in Washington. But the question is, it's not just walking and chewing gum. Look at the list here. Harvey relief, a budget bill, the debt ceiling, flood insurance reauthorization, children's health insurance extension, the Defense Reauthorization Act, FAA reauthorization. That's some of the things, the big -- the top seven, if you will, if you have a different issue you might want to put other things on that list as well.

There are I think 12 legislative days left on the official calendar. And again, Americans will say, we'll just work more days. We'll get your job done. But that doesn't always translate here in Washington. What falls through the cracks here? Or can they do all this?

UNIDENTIFIED FEMALE: Absolutely not. They can't do everything. They'll do the must-pass things, right. And this is one of them.

UNIDENTIFIED FEMALE: Not easily.

UNIDENTIFIED FEMALE: Right. And I think by attaching debt ceiling potentially a short-term spending bill with Harvey, leadership thinks, you know, we can sort of clear the deck chairs here and focus on tax reform. Focus on a broader spending deal that's coming later in the fall. But it's just -- it's not going to be easy in and of itself to do. I mean, they get back. The House is going to pass this Harvey Bill next week. We're hearing that the Senate will then attach the debt bill and send it back to the House to get it through.

But FEMA is running out of money right now. I mean, we're hearing that they need this money now. Is there enough time for them to negotiate all these things in one package and get FEMA the money they need in the next couple days? KING: And then what is the ultimate score card for a first-year president, a first-year president. Let's say they come back and they do Harvey, they have some fireworks over debt ceiling, will they get it done one or two of those other things in the list gets done. Is this President going to end the year?

Look at the score card here. Obamacare repeal and replace? No. Tougher trade deals? In progress maybe, some negotiations but nothing legislative through. Tax reform? That's still at the starting gate. Infrastructure? Not even at the starting gate. Is this going to be the final year report card for the first-year president?

UNIDENTIFIED MALE: Well, and we're now looking at some of the basic requirements of government. You know, it's keeping the lights on. You know, funding, and then preventing a government shutdown, and raising the debt ceiling. I mean those are sort of bread and butter.

KING: And I thought when Republicans ran everything it was going to be better than that.

UNIDENTIFIED MALE: Exactly. And so, we're replaying the debates that we saw under divided government. When it was President Obama, a Democrat facing a Republican-controlled Congress and they're facing just as many challenges if not more under complete control by the Republican Party.

UNIDENTIFIED FEMALE: -- about 2011 and 2012 told us is that there's a difference between a temporary government shutdown over spending fight and going over the fiscal cliff on the debt ceiling. And what this Trump White House is trying to do would say, we understand there were some Republicans who really would feel better if there was a government shutdown. Can we please have it over a less consequential thing than paying debts to which we're already obliged because that has the potential to mess with markets?

And if -- and President Trump's biggest selling points so far other than Neil Gorsuch, has been the gain in the stock market, the gain in, you know, in those numbers that he can look at month after month and say, look how things, it's great. Greater things have been since I took office. You take that away in to a billionaire real estate investor's minds, that's actually really is a problem. The legislative accomplishments may be slow. They may have to put DACA stuff out there now to show that they're moving ground on something. But if you start messing with the market, is really a problem.

KING: We'll see. And we get a down payment when we see the House come back tomorrow start debating the Harvey Bill. We'll see how quickly, let's see if they stay in peace or if that mood deteriorates. We'll keep an eye on that.

[12:40:04] And up next, the Labor Day, look at the battle for those blue collar voters who helped turn those blue states red last election.

(COMMERCIAL BREAK) KING: A reminder this Labor Day, Donald Trump is President because he flipped blue states like Michigan, Wisconsin, and Pennsylvania. And he did that in part with some promises to blue collar workers who traditionally vote Democratic. Some of those promises from the President during the campaign, infrastructure spending, renegotiating trade deals, rebuilding U.S. manufacturing, stopping American companies from shipping jobs overseas.

Incomplete, it'd probably be the great to give the President at this point. But he talks about these issues a lot. Remember in the campaign, the big unions, overwhelmingly with Hillary Clinton. The President has some small union support, law enforcement, people involved in border protection and security. But the big labor movement was heavily, heavily behind the Democratic candidate. No surprise there. This numbers a bit of a surprise, though.

Look at the vote, union households, President Obama had an 18-point advantage over Mitt Romney in 2012. Only nine points for Hillary Clinton in 2016. Those numbers there explain Pennsylvania, Wisconsin, and Michigan. More blue collar voters backing Donald Trump including voters from union households.

[12:45:14] Democrats know that's a problem. They can't win unless they change that. Here's Bernie Sanders a bit earlier today a Labor Day event in New Hampshire.

(BEGIN VIDEO CLIP)

SEN. BERNIE SANDERS (I), VERMONT: Why in the wealthiest nation in the history of the world has the middle class of this country been in decline for the last 40 years? Why is it that in New Hampshire and in Vermont we have tens of thousands of people who are not working one job but they're working two jobs or maybe three jobs to bring in enough income to pay the bills?

(END VIDEO CLIP)

KING: No question, Democrats see the problem. Donald Trump does have a lot of support among blue collar workers. People who work with their hands, as Donald Trump says, that the Democrats see the problem. Do they have a solution of anywhere close?

UNIDENTIFIED FEMALE: Yes.

(CROSSTALK)

KING: That's your answer.

UNIDENTIFIED MALE: I don't -- I mean, they're still -- you can see them sort of struggling with the message. Elizabeth Warren came out today with a 20-page report on why Donald Trump is bad for workers. So it's clear that they sort of seem that -- all understand where the problem is but the solution seems mystifying to them so far. They haven't come up with the right solution to rip on.

KING: You have heard a lot from Democrats saying the President hasn't kept his promises on trade. That he said he was going to label China a currency manipulator. He hasn't done that.

You know, he said he's rip up NAFTA. Now they're renegotiating. We don't know where that one ends up. Is that enough or do we even -- can we know the answer to this question until we get back into a re- election cycle?

UNIDENTIFIED FEMALE: He said he was going to have a trillion dollar infrastructure plan which he's never produced and now he's looking the Congress to do it and they're lukewarm at best that they never did like the idea. Medicaid, he was promoting a plan that would have cut hundreds of billions of dollars over time, which a lot of these people benefit from it, but, in the dwindling number of union households who mostly have employer-provided insurance, there's a lot of people that were benefiting from Obamacare.

Medicaid for opioid treatment and prevention and the budget cuts. I mean, Congress isn't accepting of his plan. But the budget he put out early in the year would have just slashed up to 30% from any number of programs that go to social services for job training and education and the like.

This is one area where I think in terms of getting to the blue collar workers, and I'm from Toledo, Ohio. A lot of people that I know still back home, he is going to have to show results here. There's that 25% of Trump supporters who say he could just about do anything, as he said himself, and they would still support him. But there are a lot of working-class Americans who want to see some results.

UNIDENTIFIED FEMALE: And it feels like Groundhog Day sort of, doesn't it, since the election that we -- having the same conversation about Democrats and it really who is the new face of the Democratic Party? What is -- what leadership kind of structure is the Democratic Party coalescing around? Is it going to be the kind of liberal base, Elizabeth Warren, more established leadership? Is it going to be a younger face? Or maybe even irrelevant of age? Is it going to be someone who is centrist or maybe they're not centrist. Maybe they're left of center but can appeal to the center and they can appeal to some of those folks who voted for Donald Trump.

Until then they resolved that question, all they're doing is running against Donald Trump. And, you know, it's very hard to -- for a group to maximize its own potential if they're just running against something and not running for something.

KING: The midterm elections will give us an early test. But I think we may see some Democratic debates about the sides of those big Republican debates, the beginning of (INAUDIBLE).

UNIDENTIFIED FEMALE: Yes.

KING: When we come back, you don't want to miss, it's a quick conversation about a unique program on "CNN TONIGHT, THE REAGAN SHOW." The return of Ronald Reagan.

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[12:53:07] RONALD REAGAN, 40TH PRESIDENT OF THE UNITED STATES: Good evening. This is Ronald Reagan. President of the United States of America. You got history books over there (INAUDIBLE)?

I'm pleased to speak to you on the occasion of the New Year. On behalf of the American people, I wish you all a happy and healthy new year. Let's work together to make it a year of peace.

(END VIDEO CLIP)

KING: You have to smile and laugh as you watch that. President Ronald Reagan reading part of his 1986 New Year's address to the people of the Soviet Union. Tonight, you can catch more rare unseen footage in CNN to "THE REAGAN SHOW". It's a deep dive into the great communicator's presidency.

What makes it great, I can't wait to watch. There always out takes from the President and things like that. Recording messages where you saw the actor Ronald Reagan. He's a very funny man just saying things. Can't wait to see it.

Before we talk real quick, I just want to play one more. One more of the signature things about Ronald Reagan with his relationship with First Lady Nancy Reagan. Take a peek.

(BEGIN VIDEO CLIP)

REAGAN: Got an idea for another picture. Just one more. I've got the chain saw. And you're blocking me off. Stopping it from -- don't just stand there. You're supposed to be saying, no. I'm going to start the saw.

UNIDENTIFIED FEMALE: No.

(END VIDEO CLIP)

KING: Just a reminder, pre-internet, pre-social media. Ronald Reagan was so conscience of the public image. That's out at the ranch in Santa Barbara where they would stage these photos to show the robust president and the loving relationship with Nancy throwback.

UNIDENTIFIED FEMALE: Right. And, you know, they both come up through Hollywood when that was very much a part of what Hollywood studio systems would have whether through magazines or little film reels. They would have people like, here are some candid shots of our, you know, starlet at home. Just moved on to a different stage.

UNIDENTIFIED FEMALE: Wearing her FLOTUS cap.

UNIDENTIFIED FEMALE: Yes.

KING: Yes. Yes, you have one more? Remember Donald Trump says he doesn't like, you know, he likes to be unpredictable. Ronald Reagan a little bit like that.

(BEGIN VIDEO CLIP)

[12:55:02] DONALD TRUMP, PRESIDENT OF THE UNITED STATES: Let me just say that I feel very good but I'm also a little superstitious. I don't want to talk about things until they happen.

(END VIDEO CLIP)

KING: Don't hear anyone say this very often but I wish I were a little older. I got here for the last three months of the Reagan administration. I wish I got here a little sooner to cover him because he's always clicks (ph) to make a laugh to the stories people who did, crack you up.

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: It is interesting, the sort of the medium of TV and Reagan's ability to use that and Trump today, you know, certainly using Twitter in a unique way. You know, and they have differences, obviously. But sort of changing the way that presidents communicate.

KING: Although the Reaganites don't like when people make the comparisons of the two. The Reaganites don't like it at all, not one bit.

Thanks for joining us in INSIDE POLITICS. Jim Acosta in the chair after a quick break.

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JIM ACOSTA, CNN ANCHOR: Hello, I'm Jim Acosta in for Wolf Blitzer. It's 1:00 p.m. here in Washington and 2:00 a.m. --