Sen. Stabenow: Middle Class Always Asked To Bear The Brunt

It's exhausting to listen, isn't it? The bobbleheads (especially the Republicans and the media elite) are so endlessly cynical, pushing lies they probably don't even believe, but think it helps them maintain an advantage. (It's like watching
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It's exhausting to listen, isn't it? The bobbleheads (especially the Republicans and the media elite) are so endlessly cynical, pushing lies they probably don't even believe, but think it helps them maintain an advantage. (It's like watching professional wrestling.) And just like in wrestling, This Week moderator George Stephanopoulos seems to miss every single foul:

STEPHANOPOULOS: Hello again. Just over three weeks away from that fiscal cliff. We've just come off a week of press conferences, speeches, symbolic votes in the Senate, but less than a single hour of serious negotiating.

So what will it take to break the stalemate? We're going to get into that and a whole lot more this morning with two big roundtables of elected officials and experts. Let's begin with the lawmakers, Senators Tom Coburn for the Republicans, Debbie Stabenow for the Democrats. And here in the studio, Democratic Congressman Raul Grijalva and Republican Jeb Hensarling.

And, Congressman Hensarling, let me begin with you. The president's been absolutely clear of at least one thing. He says that for there to be a deal, tax rates on the wealthy are going to have to go up. If that's his bottom line, can there be a deal?

HENSARLING: Well, again, as the speaker has said, unfortunately, what we see out of the president is my way or the highway. Before the election, he said he wanted $800 billion worth of revenue, $1 of revenue for every $2.50 of spending reductions. And now, after the election, it's a little bit of bait-and-switch. Now he's asking for $1.6 trillion. And if you look closely, for every $1 of tax increase, there's about 20 cents of spending reductions...

Yes, how dare the president read the election returns and up the ante?

STEPHANOPOULOS: But he said he can negotiate on the number. I'm talking about the rates. If the rates go up, can the Republicans in the House accept a tax rate increase?

HENSARLING: No Republican wants to vote for a rate tax increase. I mean, what that is going to do, according to the National Federation of Independent Business that commissioned a study by Ernst & Young, is cost 700,000 Americans to go from having paychecks to unemployment checks. Because of what that's going to do to the economy, George, hardworking Americans are going to see a 2 percent reduction in their paycheck if they...

Okay, hold up a minute here. The NFIB is not, as they like to bill themselves, "the voice of small business." They're a lobby shop for large corporations, and just about everyone with an ounce of integrity has debunked their bought-and-paid-for "study." So why doesn't George Stephanopoulos know this? Even worse, does he know it and decides to keep it under wraps to lend validity to the argument? Doesn't claiming the title of journalist require a little, you know, actual work?

STEPHANOPOULOS: So then there's no deal?

HENSARLING: Listen, the president, again -- if he would -- if he would do what he said before the election, as opposed to the bait-and-switch, what Republicans feel like is a little bit like Charlie Brown running to kick the football and Lucy pulls it away.

STEPHANOPOULOS: Let me bring...

HENSARLING: But ultimately it's a spending problem. That is where the problem is. The American people know it. And this talk of taxes is almost irrelevant to the size of the trillions and trillions of debt.

STEPHANOPOULOS: But not to -- but not to the president's negotiating position. Let me bring it to Senator Coburn, because you've signaled, Senator, that you could sign on to a tax rate increase, provided that the president and the Democrats come forward with significant spending cuts and entitlement reform. So what is it going to take for you to sign on to a tax rate increase?

COBURN: Well, significant entitlement reform. The real problem -- the president's proposing 7 percent of the solution. What we ought to be working on is the other 93 percent, because even if you do what he wants to do on tax rates, you only affect 7 percent of the deficit. What we have done is spend ourselves into a hole, and we're not going to raise taxes and borrow money and get out of it.

And so will I accept a tax increase as a part of a deal to actually solve our problems? Yes. But the president's negotiating with the wrong people. He needs to be negotiating with our bondholders in China, because if we don't put a credible plan on -- on the discussion, ultimately, we all lose.

STEPHANOPOULOS: Well, you've got your colleague, Senator Debbie Stabenow from Michigan, Democratic colleague in the Senate, right on the screen, as well. Can you just say quickly what it's going to take? Because I want to see if she can accept the kind of entitlement reforms and spending cuts that you're talking about.

COBURN: Well, we've got to quit playing the game, George. You can't continue to lie to the American people. There is no way to fix Medicare under the guidelines at AARP with our tax dollars are using to now advertise to say don't fix it. We need to fix it. And the way to fix it is to control the costs. And the way to control the cost is to have more individual participation. And there's a lot of ways to do that, but you can't play the game and hide.

Medicare and Social Security and Medicaid, if those aren't fixed, if we're not honest about how to fix them, and the fact that, yes, everybody in this country will have to participate in some discomfort if we're going to get out of this hole.

STEPHANOPOULOS: Well, Senator Stabenow...

(CROSSTALK)

COBURN: And as long as we continue to lie to the -- as long as we continue to lie to the American people...

STABENOW: George...

COBURN: ... that you can solve this problem without adjusting and working on those programs, it is dishonest and beneath anybody in Washington.

STEPHANOPOULOS: So Senator Stabenow, you heard it right there, Medicare, Medicaid and Social Security, all have to have significant reform, everyone's going to have to sacrifice. Can you accept that?

STABENOW: George, let's look at the facts, first of all. There are three parts of the stool here to solve this problem. One's spending. We've already agreed to $1 trillion in spending reductions. Two, Medicare and entitlements. We've already agreed to over $700 billion in spending reductions on Medicare, starting by cutting overpayments to insurance companies. Three is making sure the wealthiest in the country contribute to solving the deficit problem. That's what hasn't passed.

So for us to continue on this, we have to have the Senate bill that continues tax cuts for middle-class families, that says to the wealthiest among us, you're going to chip in, you're going to be part of the solution. The House just needs to pass it.

That would mean we would have done something on each of the areas that my colleagues are talking about. Then we have to take another step on all three of those. But right now, the only thing I hear, the only thing we see is middle-class families being asked over and over again to be the ones who have the burden in solving this problem.

STEPHANOPOULOS: So your position is...

STABENOW: And we're saying no.

STEPHANOPOULOS: So your position for now is clear: no more reforms in Medicare or Medicaid until the middle-class tax cut is extended. Congressman Grijalva, is that your position?

GRIJALVA: Yeah, it is. And I -- and I think, when we look at the deficit, debt creators, that we have to look at that as the source of revenue, as well, to begin to solve this problem and to balance it. When I talk to the business folk in my district, the guy who sells furniture up the street, and neighborhoods that were hit hard by this recession, they're not asking, "Oh, what's going to be my tax rate? Or what's the tax situation?" They're looking for customers.

And part of this whole crisis that we're talking about is about jobs and the ability to generate -- that this government generate jobs to put Americans to work and put Americans back in a secure place for their families and, correspondingly, to help the businesses of this nation.

I -- I really think that what we're doing is ignoring other sources. We're ignoring the loopholes. We're ignoring the subsidies. We're ignoring -- ignoring all of the breaks that have happened over a decade-plus. And now we're asking the middle class, the elderly, the poor to carry the brunt of mistakes that were made 10, 12 years ago.

STEPHANOPOULOS: Well, Speaker Boehner has said he's willing to get about $800 billion by closing deductions and loopholes for the wealthy, but another thing that's been put on the table, Congressman Hensarling, this week -- and the president has said, bottom line, again, he's not going to negotiate at all over the debt limit. So you've got two big bottom lines for the president right there.

I have to tell you, I've been around Capitol Hill and Washington for an awful long time, and it's hard for me to see, with those two big absolutes out there, that you can actually get this done by December 31st. So is there a fallback position for the Republicans right now?

HENSARLING: Well, I must admit, I didn't know the president could surprise me once again, but to say that he no longer wants to have a debt ceiling -- in other words, we no longer need even a speed bump on the -- on the highway to bankruptcy -- I mean, let's look at Greece. Greece has been very adept at increasing their debt ceiling. And now they have 25 percent unemployment, 50 percent youth unemployment.

There are people who can't even finds jobs in cities who are having to move out, according to press reports, into rural areas to subsistence agriculture. I mean, that -- that -- that could be our future.

And as Tom said, if you gave the president every job-harming tax increase that he's asked for, it's about 3 percent of the spending. And the president himself has said that the drivers of our debt are Medicare, Medicaid, and health care. Nothing else comes close.

Ding ding ding! Krugman's law: Anyone who compares America's economic situation to that of Greece is either a liar or incompetent. Don't believe a word he says.

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