This Week on ABC, The Nation's Katrina Vanden Heuvel was the one voice of reason, pushing back against the idea that austerity and budget cuts are going to somehow solve our country's economic problems, or the notion that the debt and deficit should be our biggest concern.

VANDEN HEUVEL: I agree with Paul Gigot. Americans voted decisively for fair share taxes on the richest, for protecting Social Security and Medicare, but also for growth and investment. You cannot get growth and investment with the spending cuts as they are laid out in the grand bargain.

STEPHANOPOULOS: And certainly not the sequester.

VANDEN HEUVEL: Certainly not the sequester. So I think part of the problem we're having, George, is the fundamental assumptions overriding this entire discussion. Senator Murray said that we have a big debt and deficit problem -- no, we don't. We have a big public investment and jobs problem.

(CROSSTALK)

VANDEN HEUVEL: Last point. We're not Greece. Austerity, if you believe in evidence-based politics and economics, you look at what's going on in Europe, and austerity, which we may have American-style in this country if we proceed the way we are doing, has led to economic pain, has led to killing growth. Killing growth.

(CROSSTALK)

VANDEN HEUVEL: And debt and deficit.

Amen to that sister. This needs to be repeated as often as possible whenever we hear the fearmongering about falling off of the "fiscal cliff" and the real danger to our economy that austerity measures pose. As she pointed out, the deficit can be taken care of later, but we've got to get the unemployment numbers down first and Americans back to work.

Full transcript of the segment above below the fold.

STEPHANOPOULOS: The president there with some tougher talk than perhaps you saw before. But let me go to Congressman Schock with this, because you were echoing the words of the speaker there, saying the mandate is for people to work together. A lot of reporting that the speaker was very firm with members of your conference this time around, that he wants to make sure they fall in line behind his leadership on getting a deal.

What I'd like to press on is what does that mean this time around? Is your conference ready to come forward with some revenues to make a deal work?

SCHOCK: I think as you saw in Bob Woodward's book, the evidence is out there. John Boehner extended a hand of revenue last time, nearly $800 billion of revenue, and the president walked away from the table of $800 billion, wanting over $1 trillion in revenue.

I think our conference stands ready behind our speaker on the issue of revenue, primarily through loophole elimination and deduction, elimination through tax reform. But what we really need from the president is leadership. We need from the president the other side of the ledger. He talked throughout his campaign about a balanced approach. He's talked about raising taxes on filers over $250,000. But the fact is, even if he gets what he wants, which is a tax increase on people over $250,000, that's $80 billion a year. We're running a trillion-dollar deficit.

So where the president needs to lead is put forward a budget, put forward a plan that deals with the major drivers of our debt. If he doesn't like the premium support program for Medicare, if he doesn't like some of our reforms to the drivers of debt, that's fine. But we can't negotiate with ourselves, and at this point the House is the only one that's led on these issues.

STEPHANOPOULOS: The president had some of those ideas in his last -- in the ideas that he brought to the speaker, but one of the questions, Congresswoman, is will the Democratic caucus follow him on that?

EDWARDS: I think that one of the things that the president has said and we heard this last week, is he really does want a balanced approach to this. He has put on table $1 trillion over ten years with removing the tax cuts for filers over $250,000. And he ran on this. So it's not like the American people didn't hear what he said during the election and aren't buying--

STEPHANOPOULOS: Paul Gigot, the president does seem pretty determined in -- and you had Jay Carney come out on Friday, saying he's not going to sign -- he would veto anything that extends the tax rates for people over $250,000. I listened to all the leaders over the last several days, and I know everyone is saying they want to work together. I think the chances of America going off the cliff are at least 30, 35 percent.

GIGOT: I agree with you, I do. I mean, if that was an olive branch, I'd hate to see the stick that the president offered. He really made no concessions at all. I think the problem the problem that he has, above all, we're talking like accountants here, all right, in balancing the budget. What he needs above all is growth, economic growth. Faster growth. 3 to 4 percent growth. That's what carried Reagan and Clinton in their second terms.

VANDEN HEUVEL: I agree with Paul Gigot. Americans voted decisively for fair share taxes on the richest, for protecting Social Security and Medicare, but also for growth and investment. You cannot get growth and investment with the spending cuts as they are laid out in the grand bargain.

STEPHANOPOULOS: And certainly not the sequester.

VANDEN HEUVEL: Certainly not the sequester. So I think part of the problem we're having, George, is the fundamental assumptions overriding this entire discussion. Senator Murray said that we have a big debt and deficit problem -- no, we don't. We have a big public investment and jobs problem.

(CROSSTALK)

VANDEN HEUVEL: Last point. We're not Greece. Austerity, if you believe in evidence-based politics and economics, you look at what's going on in Europe, and austerity, which we may have American-style in this country if we proceed the way we are doing, has led to economic pain, has led to killing growth. Killing growth.

(CROSSTALK)

VANDEN HEUVEL: And debt and deficit.

VAN SUSTEREN: It's my turn on this. You know what I don't understand? How the American people have let all these members of Congress, the Senate and the president off the hook? This, we're now going to go off the fiscal cliff? Now, it's not a now. We have known about this since at least July of last year, and all they have done is absolutely nothing.

(CROSSTALK)

STEPHANOPOULOS: Nothing could get done during a presidential campaign. It's not possible.

VAN SUSTEREN: But that's the deplorable thing. Is that we all say, well, that's the way it is, nothing ever gets done. I'm surprised that the American people, everyone knows about this, but the whole government has been on stall, nothing has been done. They have known about it. And we're supposed to say, well, that's the way it is, that's the way it's always been. Now we've got this fiscal cliff where a lot of American people are really going to get hurt.

(CROSSTALK)

EDWARDS: I think what the president has laid out, I think he's been very reasonable. He said, you know what, we do need balance. We'll remove those tax breaks for the wealthiest, we'll make investments that we need to in infrastructure and education, in research and development, in things that are actually going to make us competitive and actually contribute to the growth that we all -- that all of us -- that all of us want.

(CROSSTALK)

EDWARDS: And I think that it's incumbent now for a slimmer Republican majority in the House, slimmer major -- larger majority in the Senate and the president to actually come together where we can. We all actually agree that we need to keep those tax cuts for people making up to $250,000. Let's just pass that and do it.

(CROSSTALK)

STEPHANOPOULOS: -- part of the question for you, Congressman Schock. I think there's some bipartisan agreement that closing loopholes would be a way to go, a way to raise revenue. The problem has been the math. You can't get enough to actually fill the hole by simply closing loopholes and deductions for the wealthy.

SCHOCK: Well, I'm glad you bring up math, because once again, we have heard about the president's plan to raise taxes on wealthy individuals as a means to deal with our debt crisis. But the reality is, the math doesn't add up. We can't tax our way out of debt. OK? That's a fact. And so whether we have to deliver a calculator to the White House in order to get a budget from him that works -- I'm not willing to go along with a straight-up tax increase that the president wants. OK? But even if he get what he wants, if he is going to lay out a balanced approach, it needs to be balanced. OK, Mr. President, you want to raise taxes by $100 billion a year or $1 trillion over ten years -- we're running a $1 trillion deficit every year. The reason why you don't have a lot of optimism coming out of Republican conference is, we have been out there leading with our chin the last two years on a budget, the president has criticized us left and right over our proposals and given us no countervailing proposals.

(CROSSTALK)

VAN SUSTEREN: Neither party is talking about waste. I mean, you're talking about -- no, they're not.

(CROSSTALK)

VAN SUSTEREN: It's part of the culture.

VANDEN HEUVEL: What strikes me if you look at the exit polls, voters, majority of the voters did not say deficits were their main concern. It was about jobs and growth. And you can't cut your way to growth. So--

GIGOT: You can't tax your way to growth, either.

VANDEN HEUVEL: But you know, a tax cut has never built a bridge or helped with a deteriorating infrastructure of this country. I think you put people to work, and my proposal is you don't let spending cuts kick in until you have unemployment of 5 to 6 percent. Then you have a healthy country growing, and then you turn to the issue of recovery, of debt and deficits.

I think though, more important, the president needs to go out to the country and speak to those voters who said that their main priority was growth and jobs. And I think how he does this will set the tone for his second administration.