Giffords Brings Down the House; FAA Funding Fight; Default Deadline Arrives; Rhode Island City Files for Bankruptcy; Casey Anthony Probation Order
ALI VELSHI, CNN ANCHOR: It's all over the place Carter sees the bright spot. We'll be back with him. He's coming back tomorrow morning, 5:00 a.m. Eastern. Catch him on cnnmoney.com. That's it for us on "WAKE UP CALL." AMERICAN MORNING," cheery as ever starts right now.</s>CAROL COSTELLO, CNN ANCHOR: I like what Carter said too. Good morning, everyone. I'm Carol Costello. Tears and cheers on Capitol Hill not for the debt ceiling deal, but for Gabrielle Giffords, the wounded congresswoman bringing down the House last night.</s>VELSHI: Funding fight over the FAA. I'm Ali Velshi. The agency forced to partially shut its doors. What it means for your safety and the price of your next airline ticket on this</s>AMERICAN MORNING. COSTELLO: Good morning, everyone. It is Tuesday, August 2nd. This is AMERICAN MORNING. Christine has the day off because boy, she's a little under the weather yesterday.</s>VELSHI: She's trying to fight that cold and it keeps coming back.</s>COSTELLO: Those kids, little germ incubators.</s>VELSHI: I know that's why I keep none of them around me. A lot going on today. This debt debate it's just not over. It was supposed to be over last night and it didn't end.</s>COSTELLO: Well, it's almost over because the Senate votes on it and goes to the president and we'll still be talking about it. Anyway, welcome to D-day, the day America hits the default deadline. Right now you look live at the capitol. Later today, the entire world will be watching when the Senate votes on a compromised debt ceiling deal. And what a moment this was. For a brief moment last night, Republicans and Democrats put aside their differences to embrace a surprise visitor, Congresswoman Gabrielle Giffords. For the first time since being shot in January, Giffords returned to the House Chamber to vote in favor of the debt deal. It was a moving sight that brought everyone to tears.</s>REPRESENTATIVE NANCY PELOSI (D), CALIFORNIA: Throughout America, there isn't a name that stirs more love, more admiration, more respect, more wishing for our daughters to be like her, than the name of Congresswoman Gabby Giffords. Thank you, Gabby, for joining us today.</s>VELSHI: Giffords closest friend in the House, Florida Congresswoman Debbie Wasserman-Schultz got a call from Giffords' husband yesterday. He told her Gabby felt she had to be in Washington if her vote could keep America from slipping into default.</s>REPRESENTATIVE DEBBIE WASSERMAN SCHULTZ (D), FLORIDA: It was just the most overwhelming, I mean, it would be hard -- my heart was -- all of our hearts were so full and you have had some grizzled hardened members with very hardened hearts that everybody had melted when she walked in the chamber. It was so incredible.</s>VELSHI: By the end of the night, the House voted 269 to 161 in favor of the deal. Afterward, our own Kate Bolduan got a rare interview with House Speaker John Boehner about the painful process that got us here.</s>KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: How do you feel, sir?</s>REPRESENTATIVE JOHN BOEHNER (R), HOUSE SPEAKER: I feel great.</s>BOLDUAN: What do you think of the vote this evening?</s>BOEHNER: It was a strong vote, but first step in many steps yet to go.</s>BOLDUAN: What do you hope the American people take, what do you think the message is for the American people tonight?</s>BOEHNER: The process works. May not be pretty, but it works.</s>COSTELLO: You heard him. He says it works. It is a deal that no one seems to like.</s>VELSHI: He was right about the fact it wasn't pretty.</s>COSTELLO: No, it was really ugly. There's only hours to go before this default deadline kicks in, a deal we kind of have to live with if it makes it through the Senate today, which it's expected to do. It will.</s>VELSHI: I'm sure it will, but everything is moving slowly than you would expect it to. Joe Johns joins us live from Washington this morning. Sixty votes are needed for the measure to pass today, Joe. Do you even know why it's 60 as opposed to just 50 and are they going to get the votes necessary?</s>JOE JOHNS, CNN ANCHOR AND CORRESPONDENT: Well, it's the issue of somebody trying to filibuster or somebody trying to hold up debate or whatever and that's the rule in the United States Senate, unless you have a 60 vote majority, you may have to come up with 60 votes to get anything through. You know, the question is, is this going to be a slam dunk? The people in the Senate who should know, think they have the votes to pass it. I mean, this is a compromise that was fashioned in the Senate over the weekend. You can make the case this is their product, that given the alternative, which is pretty ugly, they got the best deal they could get. I don't think anybody got all of what they wanted, but for the most part, Democrats and Republicans were able to hold on to their bottom line priorities. The president's party was able to get the debt ceiling increased and a way to extend borrowing authority out through 2012. Republicans got a promise at least of no new taxes and huge reductions in government spending. Some said it wasn't as much as they wanted. You know, this is one of those hold your nose kind of votes where nobody says, I like this thing completely.</s>VELSHI: All right, Joe, we're going to be watching it very closely to see how this actually develops and whether any more wrinkles show up. In your view, we're done with the road bumps and wrinkles? I'm not asking you to prognosticate, but there's nothing obvious at this point?</s>JOHNS: No, I mean, there's nothing obvious. There's a group of very conservative senators and, you know, they're a little bit, you know, concerns about what they might do. One of them walked past me in the hall over in the senate side yesterday, Jim DeMint. And I asked him are you going to hold this thing up or whatever and I mean, he just kept walking. He didn't give me a peep. So, again, though, we're told that the Senate people think they actually have the votes and that's the important thing.</s>VELSHI: Joe, thanks very much. We'll check in with you later. Joe Johns in Washington. If you're not already furious with your elected officials for the way they've handled this debt ceiling crisis, this may push you right over the top. Because Congress couldn't stop bickering and this deal came down to the wire instead of getting done two weeks ago, for instance, American taxpayers are now on the hook for $1.7 billion more. That's how much additional interest the government had to pay investors to get them to buy treasury bills now that the risk is a little bit higher, Carol.</s>COSTELLO: It's always something, isn't it? If Congress passes the debt deal, a special bipartisan committee will be created to come up with a plan for even more cuts. That's going to be called the Super Committee. I knew I wouldn't do this right, but the Super Committee will consist of six Democrats and six Republicans. Those six Democrats and six Republicans will be selected by the Senate leadership over there and the House leadership. Once they're in place, they will begin debating what to cut and what not to cut. They're going to try to figure out $1.5 trillion in additional cuts. They have to do that by a certain deadline and that deadline will be Thanksgiving. Once they get all of that into place and we're certain they will because things are working so well in our government, their plan will go to the entire Congress, to the House and the Senate and then, of course the House and the Senate will vote yes or no. They'll have to do that by Christmas time. If they vote yes, all will be well. I think I went one too far. Yes. See, Ali, I should have had you come over and do this. Anyway, if the whole Congress votes yes, all will be well. If they vote no, then the president -- then that will -- all of these triggers will go into place and things will be cut like defense and entitlement programs. We don't know, but those kicks will go into place and that will allow the president to raise the debt ceiling. Also, when the Super Committee makes its decisions, there will be no amendments allowed, so the entire Congress will have to vote on this plan whether they like it or not. So we'll keep our fingers crossed and hope all will go well.</s>VELSHI: So they've got to vote up or down on this thing. I like when you did that. When it moves too slowly, everybody gets bored, whatever I'll come back when it's finished. You made me watch.</s>COSTELLO: Thanks, Ali. I appreciate that.</s>VELSHI: It was excellent. The one danger a lot of people warn is if they don't come to a deal, then those automatic cuts could be very haphazard. They're automatic. They may not be the best thing for the economy. So you know this means, Carol, you and me are going to be working Christmas, is what it means.</s>COSTELLO: Probably so, but I'm used to that, that's OK.</s>VELSHI: It would be fun hanging out with you. All right, the fight over the debt ceiling isn't the only showdown in Washington. The House adjourned for the summer recess last night and failed to approve a bill that would fund the Federal Aviation Administration. The only possible resolution is if the Senate approves the bill, but that is unlikely. So what is this all for you. First, the federal government is expected to lose an estimated $1.2 billion in taxes on air fare. Four thousand workers will remain furloughed. These are mostly administrative positions, meaning air traffic control personnel are still on the job and passenger safety should not be affected. Also construction projects are on hold. Because the government stopped collecting certain taxes on ticket sales, Delta says it will now give refunds to passengers who paid those taxes, but then flew during the partial FAA shutdown. The refunds only apply to people who bought tickets before July 23rd. So Carol, just let me make this - let's bring this map back for a second. The $1.2 billion in revenue is what the government loses because they're gone now and they can't authorize this FAA bill. The $1.7 billion is what we paid in extra interest because we had to refinance and now we're up to $3 billion just because of delays. Just because they weren't -- that's real money. It's nothing in terms of the national debt, but that's $3 billion we didn't have to pay.</s>COSTELLO: When you hear a figure like $1.7 billion, now you're thinking that's nothing, it really is. It's just the principle of it. It's ridiculous.</s>VELSHI: If you had to pay extra money, it's like these dumb things you pay because if you don't pay something on time. It's real money.</s>COSTELLO: Maybe they will learn not to wait until the last minute the next time.</s>VELSHI: I'm sure that's the lesson --</s>COSTELLO: The struggling Rhode Island City of Central Falls filing for bankruptcy as part of our continuing look at states in crisis. The city of 19,000, which is just north of Providence has been drowning in debt and it was forced to file after unsuccessfully asking police and firefighter retirees to give up 50 percent of their pension. Here's a member of the firefighters union and the city's mayor with an example of a 12-year-old retiree -- of a 42-year-old retiree rather, who's now draining the system.</s>MAYOR CHARLES MOREAU (D), CENTRAL FALLS: Collect for 40 years almost $2 million. A lot of money wasn't paid into that pension by that employee.</s>UNIDENTIFIED MALE: Retired firefighters worried about their pension long term they may get even less than half?</s>UNIDENTIFIED MALE: Everybody is concerned about what's going to happen. Just going to try to work our way through it and do what we can.</s>VELSHI: Last year, by the way, Central Falls is the same city that fired all of its teachers at its high school after a failed agreement between the city and teachers union. New developments this morning in the Casey Anthony saga. A Florida judge ordering her to return to Orlando ASAP to serve a probation sentence for check fraud.</s>COSTELLO: And you thought it was over. Yes. It's unrelated to Anthony's recent murder trial. Casey Anthony's lawyers say they will fight this judge's order. Joining us now Sunny Hostin, legal contributor for "In Session" on TruTV. We really did think this was over.</s>SUNNY HOSTIN, LEGAL CONTRIBUTOR, "IN SESSION" ON TRUTV: Just when you thought you would never see me again to talk about Casey Anthony again. She is back. Apparently the judge who sentenced her in the check fraud case, that was going on even before she was tried for the death of her daughter, he thinks that he made a mistake and instead of writing on the release papers -- probation papers "upon release" he sort of wrote she would serve probation and then the clerk thought she should serve probation while in jail awaiting trial. And that was so interesting. I mean, I've been a lawyer for a long time. I have never heard of anyone serving probation while they're sitting in a jail cell. I mean, that's the premise of probation. You want to have someone out of jail and make sure they do the right thing.</s>VELSHI: Right. I see. OK, so you wouldn't consider your jail time probation.</s>HOSTIN: No.</s>VELSHI: Doesn't serve the purpose.</s>HOSTIN: It just doesn't serve - it's never done.</s>COSTELLO: Does she have to serve probation in Orlando necessarily though?</s>HOSTIN: That's the question because the judge wrote she has to go back to Orlando in 72 hours and basically go to probation. So many people are saying well, that means she's got to stay in Orlando. Usually someone does serve their probation in their home state, the state where the crime occurred, but I just don't think that's going to happen because typically exceptions are made for the safety of a person. And I don't think that Orlando really wants Casey Anthony to come back, right. So I don't think she's going to serve it in Orlando if she serves it at all.</s>VELSHI: Now the -- her lawyers are challenging this order. The judge as you said thinks he may have a made mistake on what he wrote. What's likely to happen?</s>HOSTIN: You know, I think the defense team has a really good argument that - a double jeopardy argument she already served the probation, even though she serve is it in jail, she did already serve the probation. And so my sense is perhaps they'll have a hearing. Casey Anthony may or may not be present for that hearing. Everybody wants to see her so, perhaps, she will be there. Then we'll find out whether or not Casey Anthony is going to serve probation.</s>COSTELLO: If it lives.</s>HOSTIN: It lives, Carol, it lives!</s>COSTELLO: Well, that's too bad.</s>HOSTIN: I'm back.</s>VELSHI: It's always a pleasure to have you here. That's not the problem.</s>COSTELLO: Thank you, Sunny.</s>VELSHI: If you don't bring us more Casey Anthony stories, we'll happily have you back.</s>HOSTIN: Thank you.</s>COSTELLO: Thank you, Sunny. It is question of the day time. Being the ultimate tough guy may work for Captain America, but not necessarily for the leaders of the free world. Remember when President Bush taunted insurgents in Iraq four months after shock and awe.</s>GEORGE BUSH, FORMER U.S. PRESIDENT: There are some who feel like that, you know, the conditions are such that they can attack us there. My answer is bring them on.</s>COSTELLO: Some believe the president's words increased violence against American troops taunting the enemy isn't the best idea. President Bush later said he regretted saying that. But acting tough feels good and it's quintessentially American. It's one of the reasons why the Tea Party resonates. It's why Republicans are controlling the agenda. This debt deal fiasco, in the modern political world tough is in, compromise is weak. Last year on "60 Minutes" House Speaker John Boehner made that clear.</s>BOEHNER: When you say the word compromise, a lot of Americans look up and go, they're going to sell me out.</s>COSTELLO: That's what he thinks of it. Back in the day powerful Democrats and Republicans were able to make mutually beneficial deals. Think of Ronald Reagan and Tip O'Neill in 1983 working on a deal on Social Security or President Clinton compromising with Newt Gingrich on welfare reform in 1996, but that was then. So, question of the day time. Is compromise a sign of weakness? Send us an e-mail, tweet or message us on Facebook. We will read some of your responses throughout the hour.</s>VELSHI: And still to come on AMERICAN MORNING, relief for an Alabama town ravaged by a tornado. A new plant, new jobs are on the way.</s>COSTELLO: Despite a pledge not to market unhealthy food and drinks to kids, a new study says they still get a heap and help from advertisements through product placements.</s>VELSHI: And on a hunt for roadside bomb used to kill American soldiers in Afghanistan, we've got a firsthand look at the delicate and dangerous mission. It's part of Jason Carroll's series "A Soldier's Story." You're watching AMERICAN MORNING. It's 15 minutes after the hour.