Congress, now what. The president will turn the page, go on to tax reform. He is eager most of all, charlie to put up as he calls it, a win. The problem all along has been what institutes constitutes a win. He didnt have much of a vision for obamacare and well see, his vision is already shifting some what on tax reform. Rose we conclude with a conversation about the glass menagerie now on broadway with Madison Ferris, joe mantello, fin wittrock and sally field. We slowly move to the play without them knowing were quite in it, without us even knowing were quite in it until slowly the lights are lowering and all of a sudden we are kind of in a costume we werent in before. And then, then its in. We dont have an intermission, we dont have scene breaks, all the scenes are woven together like a memory. So you cant tell when one scene is over and the next is beginning. Rose trump and congress, Tennessee Williams and the tblas menagerie when we continue. Funding for charlie rose is provided by the and by bloomberg, a provider of multimedia news and Information Services worldwide. Captioning sponsored by Rose Communications from our studios in new york city, this is charlie rose. Rose we begin this evening with politics. President trump is vying to bounce back from recent setbacks punk wait the last week by the failure of his partys effort to repeal and replace the Affordable Care act. Doubts are rising about the president s ability to achieve progress on other aspects of an ambitious agenda as the white house begins turning its attenda to rob tax reform. On friday he received a phone call from the president breaking news a vote on the gop healthcare bill would not proceed. Im pleased to have robert costa back on this program. Welcome. Thank you, charlie. Rose i once asked donald trump when he was at cbs this morning who he thought understood him. And he mentioned your name. How did this happen so that you are the reporter he wants to call to say were pulling the bill . Well, as you know, we discussed on this program before, ive been covering him for quite some time. Ive gotten to know him as a can the da, as a businessman, now as president of the united states. Have i been working on this story with my colleagues as trump as a deal maker. Could he cut his first deal, his first legislative test, health care, trying to wade into congress, a realm he didnt really know, didnt understand all the factions and the players. I have been working on this for about a week. As usual, put in an interview request but didnt expect anything. Hadnt interviewed the president since before the inauguration. But i got this call out of the blue on friday afternoon and he was pretty even temp erred, mawted in tone and said the bill has been pulled. Started piling it on to the democrats and trying to turn his attention to other issues. Rose well talk more about that. But now he has turned his attention to the republicans, less the democrats in turns of what he said subsequently. What do you make of that. One of the most revealing moments in my conversation with the president was about when he said i just didnt understand, bob. He said all this anger. I said what do you mean by that. He said all the anger in the Republican Party, in the congress. And what he meant was the Freedom Caucus, the hardliners on the right and their contentious relationship with Speaker Paul Ryan, how the moderate tuesday group in the house had their own uneasy relationship with the leadership. And he thought the party would be in lock step or at least willing to help him with a major legislative process project like this early on in his presidency. But he said he in a way walked into a storm with all these simmering factional politics that have been playing out long before donald trump ever came on the political scene. Remember weve been talking for years about Speaker Boehner and then speaker ryan and all the upsets over government funding. And he is now face to face with that long simmering drama. Rose yet at the end of the thing, you said to him to reflect on a lessons he learned, he said what . He is not a reflective sort. I tried to pull him out, charlie, in charlie rose style, please, reflect. This is a major moment, such a big crisis for you and your party. And he said flatley, just another day in paradise. Rose how do you think he views the experience that he has had the first 50 plus days. The way he talked about it was in a way he knows is he a nonidea logical rep republican. He disn come out of the Regan Movement like ryan and so many other republicans who think of themselves at their core as tax rueter cutters, that want small government, like a real hatred of the government. Trump doesnt have that but he has embraced the ideology of ryan because ryan and mcconel in the senate, the majority leader seem to understand how government works. And trump is such a rookie at this in many ways on the scene. So hes gone along with them. The question i have as a reporter, im sure many people do out in the country, is what now. It hasnt really worked to go along with speaker ryan on health care. Will he continue to go along with the speaker and mcconel when it comes to taxes and infrastructure or maybe will eliseen more to steve bannon his chief strategist and take a more populist direction, work with democrats. But of course the democrats arent exactly jumping at the chance to work with the president. Rose so where does that leave him . It leaves him in a very difficult position, a new president , without does not fully understand yet all the different Power Dynamics within his own party. A Democratic Party thats digging in in the same way republicans did in the obama area, still testing Many Democrats i speak to in the obama area and how republicans acted. Trump has this challenge, 60 votes needed for most major pieces of legislation in the senate. In the house will you always have this group of 20 to 40 members of the Freedom Caucus without really dont want to legislate at all unless it truly takes an axe to the federal government. What does trump do. How does he navigate it. This is something that most president s confront a little longer into their presidency. He has to deal with it now. One of the things that comes out of this and is certainly in terms of the Freedom Caucus, it is said at the dont fear him. They dont. Because he has political capital. Hes one and done well in many of their districts. But they are much more of the ted cruz widg of the Republican Party, the texas senator and the Freedom Caucus were part of the Government Shutdown in 2013. They see the government is out of control. And see themselves as movement activists. And in trump they like that he is antiestablishment but when it comes to policy they see an opening that he does not really have a policy blue print. Hes trying to enact. And so trump i think was befud eled when i talked to him about this in the sense that he thought he could win over the Freedom Caucus that everyone in that group could be transactional am but in the real estate world you can have transactional deals. But when you are dealing with idea logs it is something very foreign to our. He hasnt dealt with idea logical purists and people without dont really want to have a transactional deal. Rose hes been familiar with people who it was once said, everybody has their price. Exactly. Rose when you look at his relationship with paul ryan, i mean he said very nice things to you about paul ryan. Clearly they worked hard on this. Clearly he was supposed to be the closer. And couldnt make the deal. Because of all the reasons you just said. Do you think he has any doubts about two things, first, his ability to close. Or does he simply blame the circumstances that he found himself in . He is not animated against ryan in a personal way. I asked him repeatedly about ryan trying to draw him out and see if there was anything. There he said i dont blame paul. He kept repeating the phrase. But trump and speaker ryan are kind of like a couple, you know, that everyone says its fine. And you talk to them, they say its fine. But all their friends are buzzing about the relationship and in not the best way. I talked to allies of speaker ryan, allies of President Trump over the weekend. And theyre concerned. It is a complicated relationship. Both the president and the speaker spoke over the weekend, talked through tax reform. But theres still not a lot of trust there according to the allies ive spoken to. Because they know ryan turned against trump in some respect during the campaign. And trump is disappointed about health care. But he knows who else is there to work with. He can work with mcconel on some things. The democrats arent making overtures so ryan is what he has got. So he hasnt had a full scale revolt gebs ryan but it was telling, charlie, remember, he told everyone to watch judge jeannines show. Rose who asked for ryans resignation. Who at the top of her show on fox news for ryans resignation. And then the white house officials and ryan spokes people said nothing to see here. It was, he was just trying to promote a friends show. That is the line, charlie. But i will tell you, reporters around town, people at the white house behind the scenes, people are saying the president kind of knew what he was doing when he told people to watch her show. Rose he knew that she was going to say thatment and therefore he wanted them to consider that that question. If not explicitly knowing it, i have been told from some top sources that he at least knew the direction she was likely going to head. That she was frustrated on trumps behalf whether she would take a knife to ryan politically or not. Maybe he didnt know that. She didnt know what was in the scripted. The president is not tweeting about every Television Show out. There but he did tweet about the one show that went after the speaker. Rose Breitbart News was very much opposed to paul ryan, correct . They are. And they used to be run by steve bannon. Rose of course. But where was bannon . Is bannon saying that to trump and simply was overruled . Or was he in this case saying Something Else . Well, i call him the bannonistas the people at breitbart who are bannons friends. They are certainly against the speaker and they are running a campaign against him on breitbart almost daily. But inside the white house bannon say little more intriguing because hes got to be careful and he has been careful. He hasnt mounted any campaign im told inside the white house against ryan. And he told ryan, they did have some tensions over strategy. Bannon went to the house on thursday night and said look, i want a list of who was with trump, and who was against trump. But health care, the leadership said we dont want a list like that that makes us a little uncomfortable. And thats where they had a break. Rose thats where what . Where ryan and bannon had a break with strategy. Ryan didnt want to put his members on the floor to vote for a bill that would fail. Because that only leaves people and you know congress, charlie. When a vote, everyone knows a vote is going to il fa, you have votes fall even further on the floor so you could have only had maybe 150 votes for the healthcare bill. Rose so who talked the president into having made a statement that he wanted to put it out there and have people vote it down if they did, so they would have obamacare still exist, what convinced him not to do that . It was high drama. Thursday night bannon goes to the house, says the president wants the vote, you better vote for it. This is it. Ultimatum. By friday the speaker goes to the white house. When the speaker is going to the white house, everybody knew it was bad news for the bill but news hadnt brocken. And he says to the president , he saidsch 24 is what the president said we dont have the votes, you have a decision to make with me. What are we going to do it, ryan talked with his members, he didnt want to have the vote. In a way they talked it through over the course of several minutes and decided to pull the bill and thats when i got the call. Rose where do they expect to go now . Le to get some democratic be to votes . Do they want to refashion a bill that show can find Common Ground between moderates and the Freedom Caucus. Do they want to just simply tack a breathe and try to get tax reform. I think its a little bit more of the latter, put it on a shelf for months, see where they can be in six months to a year, see if the democrats are willing to work on any piece meal legislation. Its hard for republicans to give this up. They have been fighting against obamacare for years and today, monday, the speaker went on a Conference Call with his biggest donors and said we are going to keep moving forward on health care this year in different ways. Dont worry,s fight is not over. Will you see probably legislation come up on different fronts. But this kind of wholesale overhall of the health system, it is just not a consensus within the Republican Party in congress. Rose and will tax reform be compromised by what happened on Obamacare Repeal and replace. Sure, i think. So i was talking to some congressmen today and they said look, tax reform is a big ambition. How is that going to happen . How are you going to get the votes for tack reform in terms of a lot of Different Things involved with cutting different deductions, getting rid of different subsidies and different rates for people. What is really more realistic im told from members of the house is some kind of tax rebate, minor tax cut plan that comes through the house, just so the president has some kind of tax plan, some tax cut he can tout. Rose Corporate Tax reform probably has a chance, doesnt it . It does, certainly. And theyre not worried too much about all these tax cuts being paid for. Trump is not a deficit hawk. The speaker is. But over the weekend mark meadows the chairman of the free donl Freedom Caucus said in so many words he would be willing to do tax reform without having it paid for with different kinds of deficit reduction offsets. So that means tax reform will likely move forward slowly. The question is what is the number. Will there be a bolder adjustment tax, will trump have a populist flash in the tax plan. Rose a border tax, border tax, ryans for it. The president. He is for it. Well, the president has said he wants tariffs. He would love to tax people at 30 coming in from mexico and other countries. And so a border adjustment tax was included in the House Republican tax plan as a means of nodding towards the president s pop lism in his policies. But he got a lot of pressure from retailers like walmart on senator coton of arkansas, and those kind of situations where you have a small states, poor states with major retailers. They dont want a border adjustment tax. If they dont include the border adjustment tax or start tweaking it, tax reform loses some of its lustre, some of the money it has of revenue to offset the cuts it is a very complicated process. At the moment, again just like with health care, there is no consensus. Rose speak to the question of those people who were very upset when they saw some of this bill who had been strong trump supporters. And they believe they wanted a repeal and replacement of obamacare yet when they saw this, they were in a sense, they could feel the cutting edge of how it affected them, and they were very upset about that. Thats what i wrote about a lot last week. And you look at the states trump won, the rust belt, states that have real deficits with opoid addiction, states that had a high medicaid population like ohio and pennsylvania. You saw a real reservation about this republican plan in the way it phased out the Medicaid Expansion under the Affordable Care act. And people in trumps face, some of trumps closest friends like Christopher Rudy said is to me trump is making a real mistake. He is going in the ryan direction. The reason trump won the Electoral College is because he won new states, states that had working class population, some of them who really rely on medication medicaid. And for his first act to be to phase out medicaid, make major cuts to some aspects to health care, they thought that was cutting at trumps political base, throwing them a punch unnecessarily. Trump now regrets going with obamacare, going with repeal and replace. Well, thats the whisper around the white house. When i asked the president directly about that, he said no, i dont have any regrets. The president often publicly does not have any regrets as we know. Some of the top allies say they wish in a way they could have done infrastructure first. Pulled in democrats on something that it could mix with tax cuts and some spending. Because trump is also decanessian when he thinks about government and economics and maybe cohave brought more in early. Doing it in march and airport after gorsuch and. The president has insisted that obamacare, the Affordable Care act will explode of its own nature. Do people in washington and people that you know who are independent of political opinions on this believe that is going to happen . Well, there is some concerns that premium increases could lead to some kind of collapse and certain insurance exchanges and insurance markets. But democrats tell me look, thats going to be fine because there will be trump care then. The president stepped away from health care. I think obama care when you look out across the country, there are states doing better than others. But you got to both parties know there has got to be changes made to it but no one is really willing to have a bipartisan coming together on this rlz and even democrats who supported