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ERIN BURNETT, CNN ANCHOR:
Good evening. I'm Erin Burnett and we begin OUTFRONT tonight with breaking news. A very tense phone call between President Obama and Israeli Prime Minister Benjamin Netanyahu. President Obama saying he's going to, quote, "reassess the American relationship with Israel." This is a huge development in what has been one of America's closest allegiances in the world. This is the first time that the two men have spoken since Netanyahu won the Israeli election on Tuesday night.
Jim Acosta begins our coverage OUTFRONT from the White House tonight. And Jim, ordinarily, this kind of phone call comes very quickly and it's a simple congratulations. This one wasn't quick and it certainly was not a friendly, congratulatory call.
JIM ACOSTA, CNN SENIOR WHITE HOUSE CORRESPONDENT:
#awkward, Erin. The White House says the President congratulated Prime Minister Netanyahu on his election victory in a phone call today, but there was more to this conversation than just small talk. This was a call with consequences.
(BEGIN VIDEOTAPE)
ACOSTA (voice-over):
Speaking for the first time since Israeli Prime Minister Benjamin Netanyahu's re-election win, the President made it clear that relations between these longtime allies may be about to change. The White House officials said the President told the Prime Minister that we will need to reassess our options, following the prime minister's new positions and comments regarding the two-state solution. Administration officials say they're furious over Netanyahu's remarks in the final moments of his re-election campaign, pointing to the prime minister's rejection of a Palestinian state in this interview, as a key reversal that would damage prospects for Middle East peace. Asked whether if Palestinian state would not be formed if he remains prime minister, Netanyahu said, indeed.
(on camera): Was the President personally disappointed in Prime Minister Netanyahu's comments?
JOSH EARNEST, WHITE HOUSE PRESS SECRETARY:
I would certainly acknowledge that the President is aware of the comments and noticed them. I don't think I would characterize his reaction, but I think that the -- there are obvious policy implications.
ACOSTA (voice-over):
In a post-election interview, Netanyahu completely flip-flopped, saying he now wants a peaceful two-state solution with Palestinians. But the White House is also outraged over Netanyahu's comment that Arab voters were heading to the polls in droves, a remark aides to the President blasted as racially tinged and undemocratic.
EARNEST:
That cynical Election Day tactic was a pretty transparent effort to marginalize Arab-Israeli citizens.
ACOSTA:
Netanyahu insists Arab-Israelis will always have the right to vote, but they're not buying that at the White House, where officials are threatening to allow votes at the United Nations in favor of a Palestinian state, a measure the U.S. has blocked before. Republicans who invited Netanyahu to speak before Congress against the U.S. nuclear talks with Iran are saying, get over it.
(on camera): What about the administration's sort of lukewarm reaction --
REP. JOHN BOEHNER (R-OH), HOUSE SPEAKER:
Lukewarm? Ha-ha-ha!
UNIDENTIFIED MAN:
The Obama administration and Benjamin Netanyahu need to wake up and understand the realities of what they can and cannot achieve and try to restore some adult supervision.
(END VIDEOTAPE)
ACOSTA:
A White House official says the President also discussed Netanyahu's comments about Arab Israelis. The President's posture at this point is that it matters much more what the prime minister said right before the election than how he's cleaning it up now -- Erin.
BURNETT:
Interesting point. All right. Thank you very much, Jim Acosta.
