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EARLY START

Playboy Founder Hugh Hefner Dead At 91; Trump Unveils Tax Plan; Growing Challenges In Puerto Rico. Aired 5:30-6a ET

Aired September 28, 2017 - 05:30   ET

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


(COMMERCIAL BREAK)

[05:30:25] CHRISTINE ROMANS, CNN ANCHOR: He changed the perception and reality of sex in America. Iconic "Playboy" founder Hugh Hefner has died. (INAUDIBLE).

DAVE BRIGGS, CNN ANCHOR: And, President Trump looking to reverse the tide in a rough week. His tax plan is out and he's planning an executive order on health care.

Welcome back to EARLY START, everybody. I'm Dave Briggs.

ROMANS: Good morning, everyone. I'm Christine Romans. It is 30 minutes past the hour. Nice to see you this morning.

Let's begin with the news breaking overnight. "Playboy" founder Hugh Hefner has passed away at the age of 91. He died of natural causes at the Playboy mansion surrounded, we're told, by his family.

BRIGGS: Hefner was a true American icon born in Chicago in 1926, raised by conservative protestant parents. He introduced the world to "Playboy" in 1953 and built a company in one of the most successful and recognizable American brands in history.

(BEGIN VIDEO CLIP)

HUGH HEFNER, EDITOR-IN-CHIEF AND PUBLISHER, "PLAYBOY" MAGAZINE: I have celebrated the romantic connection between the sexes and that's part of what "Playboy" is all about.

Well, I have never really thought of "Playboy" as a sex magazine. What I've tried to do is create a lifestyle magazine for men.

ANDERSON COOPER, CNN HOST": What's your definition of obscenity?

HEFNER: Racism, war, bigotry. But sex, itself, no. What a sad and cold world this would be if we weren't sexual beings. I mean, that's the heart of who we are.

(END VIDEO CLIP)

ROMANS: This morning, tributes are pouring in for the man who affectionately known as Hef.

Jennie McCarthy, who posed for "Playboy" and became a celebrity because of it -- really launched her career -- tweeting this.

"Rest in peace. Thank you for being a revolutionary and changing so many people's lives, especially mine. I hope I made you proud." Hashtag PMOY 94, meaning Playmate of the Year 1994.

BRIGGS: Overnight, crowds gathering outside the Playboy mansion paying their respects. More of the same at Hefner's star on the Hollywood Walk of Fame.

Hugh Hefner is survived by his wife and four children.

And he will forever lie next to Marilyn Monroe. He bought the vault next to hers.

ROMANS: Did he?

BRIGGS: Yes, he did. And the only place he should be.

Larry King tweeted he was a "giant in publishing, journalism, free speech, and civil rights."

ROMANS: All right.

President Trump finally unveiling his tax plan proposing the biggest overhaul in decades.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: This is a once-in-a- generation opportunity and I guess it's probably something I could say that I'm very good at.

Our framework includes our explicit commitment that tax reform will protect low-income and middle-income households, not the wealthy and well-connected.

(END VIDEO CLIP)

ROMANS: Well, there are provisions in here that help the wealthy and well-connected. Example, eliminating the estate tax and the alternate minimum taxes.

But these are tax cuts across the board. This is still just a blueprint omitting critical details that the tax-writing committee will fill in, and that could takes months or longer.

But here's what he know.

For business, tax cuts. The corporate rate slashed to 20 percent. For individuals, a simpler tax code. Seven tax brackets collapsed down to three.

Now, we don't have income ranges yet but it does cut the top rate to 35 percent. We also know it allows lawmakers to go back and add a fourth tax bracket above 35 percent. Trump has said he is open to raising taxes on the rich. That lowest rate of 12 percent, actually about two points higher than where the lowest rate is right now at 10 percent. But the White House explains that most low-income earners won't pay tax because the plan doubles the standard deduction, meaning it won't tax the first $12,000 in income for individuals and $24,000 for couples.

The plan doubles that deduction by eliminating personal exemptions, along with most tax breaks. Only two breaks are safe, mortgage interest and charity. Student loan interest, medical expenses, state and local taxes -- all the breaks on those are gone.

That last one, state and local taxes, being able to write those off your federal return, that's going to hurt people in high tax and mostly blue states, a large majority of which are middle-class.

Trump says this plan will benefit low-class families. There's not enough, really, details to know yet how. Two things will help. Boosting the child tax credit and doubling the standard deduction.

But losing the personal exemption could take away some of those savings. Right now, it reduces your tax bill by about $4,000 per person. So a lot of people are doing the math, especially people who have more than one of two kids --

BRIGGS: Yes.

ROMANS: -- are doing the math now on that personal exemption and trying to figure out hey, if I'm middle-class and I got four kids or five kids, how's that going to matter for me?

You know, we like to kind of give those details as we get more, you know --

BRIGGS: Sure.

ROMANS: -- because when you -- your own tax situation is what you really care about, right? And so, when we get more details -- for example, what those income levels for the tax brackets will be, it will be more clear.

[05:35:00] BRIGGS: In an extraordinary turn of events, it's Chuck Schumer calling for quote "fiscally responsible tax cuts." Have the Republicans put aside the deficit?

ROMANS: Some have, some have not. I think you will find some people in the House are going to want offsets. They want to find ways to pay for this because when you cut taxes for everyone something else has to go, you know. That doesn't come for free.

BRIGGS: All right, a lot to discuss with Gabby Morrongiella, White House correspondent for the "Washington Examiner." Good morning to you.

The knock is, Gabby, that this is to make the rich richer. How will the president and Republicans in Congress push back against that narrative? GABBY MORRONGIELLO, WHITE HOUSE CORRESPONDENT, WASHINGTON EXAMINER: Well, I think that there are a lot of things in this tax plan released yesterday that would counter that narrative.

Certainly, you know, making the standard deduction great for Middle America -- middle-income American families and individuals. Ensuring that the child tax credit is perhaps doubled, if not significantly increased, and eliminating some other deductions not in there.

But I do think that there is an argument to be made that perhaps the -- some of the eliminations, you know, in terms of the estate tax or the alternative minimum tax, would disproportionately benefit the wealthy and that's certainly something that Democrats are going to hone in one, and already have.

I think that's what you heard earlier yesterday by Nancy Pelosi, minority leader in the House, and other Democrats including Sen. Chuck Schumer.

ROMANS: That pass-through corporate tax rate of 25 percent and a 20 percent rate on corporate taxes.

There seems to be bipartisan agreement that our corporate tax rate system is just archaic and, you know -- I would say the most important job in any company is the person who runs the tax department, you know, trying to figure out how to get through just this crazy tax code that we have.

Is that where you could find some bipartisan, you think -- bipartisanship, you think, on the corporate tax side here?

MORRONGIELLO: Yes, most definitely. I mean, if there's any one area in this tax plan issued yesterday where Democrats and Republicans can most likely coalesce around it would be that corporate tax cut rate, bringing it down from 35 percent to 25 percent, which is a pretty substantial cut.

That's something that not only Democratic and Republican lawmakers have championed for a while here but it's also something the business community has been really pushing the administration to do. And so, I think that there is an opportunity there for some bipartisan cooperation.

But again, when you have the elimination of some of these loopholes and deductions -- and personal exemptions it's going to create contentious battles inside Congress over what can and can't be included in this plan and what Democrats might lend their support to.

BRIGGS: Well, one thing is clear. In comparison to the health care debate the president was certainly the master of details. By comparison yesterday, he has gotten involved with policy.

But the health care, well, that was a disaster. It did not go well. They did not hold a vote because they didn't have the votes. But, not if you hear the president in an interview set to air later this morning with "FOX & FRIENDS." (BEGIN VIDEO CLIP)

TRUMP: But we have the votes but we don't have the time because it's Friday. I mean, literally, Friday it ends at a certain time on Friday.

So we'll bring it into a few months from now. We'll vote it. It's block grants. It's going to be great health care.

But in the meantime, I have that little period of time. I'll negotiate with the Democrats. If we can come up with a fantastic health care bill that's OK with me. Good for both parties, bipartisan.

(END VIDEO CLIP)

BRIGGS: As for that first part, well, Lindsey Graham was clear. "While we currently don't have the votes to pass the legislation, I'm not giving up."

But let's move past that, and where does health care go from here, Gabby?

MORRONGIELLO: I mean, I think the president is eager to reach across the aisle and work with Democrats on this. But it's really difficult to see where there's going to be any consensus on health care reform, particularly because he and several Republican lawmakers campaigned on this idea of repealing and replacing Obamacare, which is something that Democrats will absolutely never support.

And so, maybe there will be an opportunity for some bipartisan health care reforms in the future but right now I think the focus is on tax reform. And the longer that Republicans put off some type of change to the current health care system it's going to be more difficult for them to come together on something.

And that's something that we've already seen happen with now twice votes failing -- or, I'm sorry, proposals failing --

BRIGGS: Yes, yes.

MORRONGIELLO: -- in Congress around health care reform.

ROMANS: Meantime, open enrollment begins in November and so the law of the land is still the Affordable Care Act.

MORRONGIELLO: Right.

ROMANS: It is still the law of the land and the person who has to implement it is the HHS Secretary Tom Price --

BRIGGS: Ah, yes.

ROMANS: -- who has been --

BRIGGS: In the news. ROMANS: -- in the news for flying on private jets.

Is that going to be a problem for him?

MORRONGIELLO: The president seemed to signal yesterday that it's certainly something he's not happy with and is going to be looking closer at. I think the question is whether or not he will make an example of his HHS secretary going forward.

[05:40:05] You know, we've already heard of the Treasury Secretary Steve Mnuchin using government planes for private travel and purposes, and now this.

And so, I think that there is a question about some of his cabinet members abusing that privilege that they have and using taxpayer money to fund some of these personal trips. And maybe this will become a greater issue and maybe he will take some punitive action against Sec. Price, but certainly something to keep an eye on going forward.

ROMANS: Yes, and Sec. Price said he took the criticism to heart.

You know, sometimes it is appropriate to use private jets, I will say.

BRIGGS: Yes, but to go from D.C. to Philly --

ROMANS: OK.

BRIGGS: -- where it takes 45 minutes to get to the airport?

ROMANS: OK, OK.

BRIGGS: You could drive there.

Anyway, it's also tough for the president to make this argument when he spent tens of millions of dollars traveling to, you know, Mar-a- Lago and his own private golf properties. That may be a tough sell.

ROMANS: All right. Gabby Morrongiello, thank you so much. Great to have you here today. Come back again soon.

BRIGGS: Thanks, Gabby.

MORRONGIELLO: Thank you.

ROMANS: All right.

Basic necessities are still hard to find in Puerto Rico. Drinking water, cash, electricity in short supply. People are doing what they can to help the sick and needy but more help is needed.

We've got more from San Juan, next.

(COMMERCIAL BREAK)

[05:45:24] ROMANS: In more than a week since Hurricane Maria, the situation in Puerto Rico grows even more desperate. A major challenge right now getting critical supplies to people who need them.

A shortage of truckers and the island's infrastructure is devastated. That makes it extremely difficult to move aid from the port of San Juan to areas around the island.

BRIGGS: Also, new questions about a century-old law critics say is making it harder to get basic supplies to Puerto Rico.

The Jones Act requires all goods ferried between U.S. ports to be carried on ships built, owned, and operated by Americans.

ROMANS: There's now a bipartisan push to get the president to suspend the Jones Act. The president is considering it but he says this. Not everyone is in favor.

(BEGIN VIDEO CLIP)

TRUMP: We have a lot of shippers, and a lot of people, and a lot of people that work in the shipping industry that don't want the Jones Act lifted. And we have a lot of ships out there right now.

(END VIDEO CLIP)

ROMANS: The Department of Homeland Security says the waiver may not make a difference since the issue isn't getting supplies to the island, it's getting those supplies off the ships and distributing them.

BRIGGS: As for the recovery, Puerto Rico's power authority says generators on the island are operational, but 80 percent of the transmission system and the entire distribution system are damaged. Also, about 44 percent of the island without drinking water a week after it hit.

ROMANS: Wow. Look at these lines at the banks. Many ATMs are out of cash. At least half of all bank branches remain closed partly because there aren't enough drivers to ferry cash around in armored cars.

For those who can get to them, more than 500 gas stations are operational.

Police say 53 people have been arrested for looting or theft since Hurricane Maria.

BRIGGS: People are doing everything they can to treat the sick and the injured but resources are extremely limited making quality care hard to come by.

We get more now from CNN chief medical correspondent Dr. Sanjay Gupta in San Juan.

(BEGIN VIDEOTAPE)

DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Well, Christine and Dave, we've made our way into this makeshift medical tent, essentially a tent set up in the middle of San Juan to try and take care of patients. This is what's necessary right now. This is part of what is known as DMAT, Disaster Management Assistance Team.

And I can tell you, many of the team members here, the nurses, the doctors, the medics, they've been busy for the last couple of months. They were in Louisiana after Hurricane Harvey, they were here in Puerto Rico during Irma, and they are back again now after Maria.

Talking to the -- one of the doctors here, they say that this is the worst that they have seen and they expect more and more patients to be coming in here as the patients are able to actually leave the areas where they live and make their way closer and closer to big cities. It's unclear right now just how many people have been affected.

But keep in mind, Christine and Dave, even before these storms, Puerto Rico was a tough place, medically. A third of the adult population reported to be in poor health. They have a significant elderly population here and lots of lots of chronic disease which they think is going to be the big problem here if those people can't get access to care.

Christine and Dave, back to you.

(END VIDEOTAPE)

ROMANS: All right, Sanjay Gupta.

A lot of people have been asking us about the Virgin Islands. I can tell you, American Airlines is going to have its first relief flight into and then out of St. Thomas today. That airport has been closed until now so good news for those of you who are watching what's happening in the Virgin Islands, too.

President Trump's inaugural committee announcing a $3 million donation to charities supporting hurricane relief. The Red Cross, Salvation Army, and Samaritan's Purse will each receive a million to support areas in the southern U.S. and Puerto Rico devastated by those storms.

The committee had pledged to give excess money from the inauguration to charity. A record-setting $107 million was raised. One hundred and seven million, wow.

BRIGGS: All right.

Lawmakers asking some big tech companies to testify about Russian meddling in the 2016 election. Facebook on the list. Plus, "CNN Money Stream, next.

(COMMERCIAL BREAK)

[05:53:35] BRIGGS: Welcome back.

NFL player Michael Bennett challenging Americans to treat people better during a town hall right here on CNN last night.

ROMANS: That's right. Andy Scholes has more in this morning's "Bleacher Report." Hi, Andy.

ANDY SCHOLES, CNN SPORTS CORRESPONDENT: Hey, good morning, guys.

You know, Anderson Cooper moderating the town hall last night to discuss the events that have unfolded between the NFL and the president over the past week, and many current and former NFL players participating.

And Seahawks star Michael Bennett had a strong message for everyone in the country.

(BEGIN VIDEO CLIP)

MICHAEL BENNETT, DEFENSIVE END, SEATTLE SEAHAWKS: You know, I would like to challenge every American that's watching this show to treat people better. That's really what it's about. It's about treating people like human beings.

That's the first step. The first step is to recognize and see somebody as a equal being when you recognize them.

There's no way that a person -- a woman should feel less human than a man. There's no way that a black person should feel less human that a white man. Everybody should be seen equal.

HINES WARD, CNN SPORTS CONTRIBUTOR: It starts with the parents, you know. My mom always taught me to treat people -- treat others like you want to be treated, you know. If you do that in life, good things are going to happen.

(END VIDEO CLIP)

SCHOLES: All right. Well, it appears Rick Pitino is out at Louisville. Pitino placed on indefinite unpaid administration leave after his basketball program was targeted in a federal investigation into fraud and corruption in college recruiting.

On Tuesday, 10 men, including a top Adidas executive and four college assistant coaches, were charged with bribing young athletes to influence their choices in schools, shoe sponsorships, and agents.

[05:55:00] Attorneys for Pitino say the Hall of Fame basketball coach plans to fight for his job. Pitino's lawyers say he did nothing wrong, calling his apparent firing a regrettable rush to judgment.

All right, the Chicago Cubs are heading back to the post-season to defend their title. The Cubs beating the Cardinals last night to win the NL Central. This is the first time the team is going to post- season three seasons in a row since 1906 to 1908. They, of course, won back-to-back titles 108 years ago but some think it could be a sign.

The Twins also popping the champagne bottles last night as they clinched the second American League wildcard. Minnesota, the first team ever to lose 100 games and then make it to the post-season the following year.

All right. Finally, Texas quarterback DeShaun Watson found a very special way to spend his first NFL game check.

(BEGIN VIDEO CLIP)

DESHAUN WATSON, QUARTERBACK, HOUSTON TEXANS: Hey, how are you all? And never complain, I really appreciate you all so I wanted to give my first game check to you all to help you all out some type of way, so --

UNIDENTIFIED FEMALE: Thank you so much.

WATSON: No problem.

UNIDENTIFIED FEMALE: Can I give you a hug?

WATSON: Yes.

UNIDENTIFIED FEMALE: Thank you so much.

WATSON: No problem.

UNIDENTIFIED FEMALE: Thank you so much. Thank you.

WATSON: Thank you, guys. I appreciate you all.

(END VIDEO CLIP)

SCHOLES: So, Watson giving his $27,000 game check to three Texas cafeteria workers, guys, who were affected by Hurricane Harvey. It's a pretty cool --

BRIGGS: You got this one.

SCHOLES: Pretty cool moment and a cool way to spend your very first game check.

ROMANS: Totally, totally. I love that. I love that about him.

BRIGGS: Dude up, got you a little bit. Well played, DeShaun Watson. The Houston Texans doing their part, no about that, with J.J. Watt.

SCHOLES: That's for sure.

BRIGGS: Andy, thanks, my friend.

SCHOLES: All right.

BRIGGS: All right.

Authorities on the Pacific island nation of Vanuatu ordering the evacuation of the entire population of one of its islands because a volcano is threatening to erupt. As many as 15,000 people live on the island. They've been ordered to leave by plane or boat.

Signs of activity from the Manaro volcano began earlier this month. The alert level was raised to four, the second-highest threat level, just last weekend. ROMANS: All right, let's get a check on "CNN Money Stream" as we wrap us this hour.

Global stock markets mostly higher right now following U.S. market's lead. Why? There's enthusiasm about tax reform.

President Trump releasing that blueprint yesterday. There were few details but he did propose tax cuts for companies and small business. Bank stocks loved that. Bank stocks were higher.

Right now, U.S. stock futures, though, turned a little bit lower.

Facebook, Google, and Twitter may testify about Russian meddling in the 2016 election.

Lawmakers asking executives to attend a public hearing next month. The topic, how foreign nationals used their platforms to influence this election. That's according to three sources familiar with the matter.

Facebook admits to selling ads to Russian troll farms and Twitter is expected to disclose similar findings on Capitol Hill today.

Facebook, Twitter, and Google haven't answered that invite yet and did not immediately respond to our requests for comment.

All right. America's inequality problem is getting worse. The richest one percent of families control a record amount of U.S. wealth, about 39 percent last year. Look at that. That's nearly twice as much as the bottom 90 percent.

And their slices only become smaller over the past 30 years -- the bottom 90 percent. That's from a new report from the Federal Reserve. It also found the richest Americans earn more overall.

This paints a stark picture of inequality in the U.S. Even the Fed acknowledged that wealth distribution has grown increasingly unequal in recent years.

Those numbers sort of at the heart of so many of the economic debates we have, right?

BRIGGS: So the trillion dollar question is do this -- does this tax reform plan --

ROMANS: Ah.

BRIGGS: -- help that?

ROMANS: Yes, sir. Well, we have a lot of questions still about taxes.

BRIGGS: We don't know.

ROMANS: And we also have a lot of questions on --

BRIGGS: What's your biggest question, though?

ROMANS: What it will do to the deficit. Well, are they -- are they going to offset some of these costs? You can't cut taxes for everyone and not pay for it somehow. How they're going to do it.

BRIGGS: How will they offset that?

ROMANS: Well, that's --

BRIGGS: Raising that --

ROMANS: -- what they have to decide.

BRIGGS: Raising the extremely wealthy --

ROMANS: That's what they have to decide. Getting rid of other loopholes.

You know, the tax code is so big and complicated because there's a constituency for everyone. So, to have lower tax rates overall other people have to give up their tax perks. That's what they'll have to decide.

BRIGGS: Yes, big battle ahead.

ROMANS: That's right.

Thanks for joining us. I'm Christine Romans.

BRIGGS: I'm Dave Briggs.

President Trump's tax plan, as you mentioned, is out. Congress has some work ahead to make it happen. "NEW DAY" will break it all down for you right now.

(BEGIN VIDEO CLIP)

TRUMP: It's called a middle-class miracle.

SEN. JOHN THUNE (R), SOUTH DAKOTA: The framework sends a loud, clear message that tax relief is on the way.

SEN. CHUCK SCHUMER (D-NY), SENATE MINORITY LEADER: The wealthiest Americans make out like bandits while middle-class Americans are left holding the bag.

UNIDENTIFIED FEMALE: We're running out of food and water.

BILL WEIR, CNN HOST, "THE WONDER LIST": It's hard to overstate just how desperate this island is.

UNIDENTIFIED MALE: This has been the biggest catastrophe in the history of Puerto Rico.

ROMANS: "Playboy" founder Hugh Hefner has passed away.

UNIDENTIFIED FEMALE: He was one of the original American playboys who helped spark a revolution.

HEFNER: I am, essentially, a romantic so I think my life revolves around women.

(END VIDEO CLIP)