CNN "State of the Union with Candy Crowley" - Transcript

Interview

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CROWLEY: Joining me now here in Washington, Democratic Senator Mark Warner of Virginia and Republican Senator John Cornyn of Texas, both members of the Senate Budget Committee, which is a very busy committee this year, let's face it.

Right off the bat is there going to be a government shutdown on Friday?

WARNER: I hope not. I mean, I think that earlier segment where you had General Jones talking about Libya, talking about America's interest in trying to promote Democratic governments across the region, what kind of signal would it send if we were to shut down our government, basically over a couple of social policy riders that were added to the budget bill? I think there seems to be some agreement around the top line number. We ought to show that we as the American government can get our act together and make sure there's not that shutdown.

CROWLEY: Senator Cornyn, did I read you wrong, at least some of your comments this week, that you're kind of on board with the $33 billion figure?

CORNYN: Well, I'd like to cut more, because we're still spending 40 cents out of every dollar the federal government spending is borrowed money, adding to the deficit and to the debt. But really the -- I think it's up to Harry Reid, the majority leader in the Senate. The House has actually already passed a bill that would fund the government through the end of September, but he's refused to take it up.

I hope we can solve the problem, because frankly, people are looking for a little bit of adult interaction and interested in solutions to our debt and to our deficits and not just games. And that's what we're getting it looks like.

CROWLEY: Well -- you know, in fact, I think the public probably just can't quite grasp what this is. This is a bill -- I mean, this budget should have been done last October. You had more than a year to deal with it and it's like every two weeks, it's like OK, let's cut another -- this is no way to run a railroad as I think both of you will admit.

And the real problem here I think is that you haven't even started dealing with the big problem this year.

WARNER: Absolutely. Because when we're talking about, you know, $70 billion, or $73 billion, or $75 billion in cuts, versus $1.6 trillion deficit, we're really only playing at the margins.

WARNER: And all of this debate so far has been only on one small portion of the budget, what's called the domestic discretionary budget, which only makes up about 12 percent of what we spend. So you're never going to get to the kind of debt reduction and deficit reduction we need unless we can broaden this debate to include all the areas that government spends.

It's security, in mandatory programs, in entitlements. And I believe until we also take a look at tax spending, which is basically tax deductions, and look at tax reform as well.

CROWLEY: Gosh, it all sounds so sensible, doesn't it? And yet so hard to get Congress to sit down. And part of the reason is what we did in kind of the setup part, which is that Harry Reid has to the left of him Democrats who are saying too much, too much, too much; and you have to the right of you, Republicans going, this is not enough.

Can you all get together on this one little piece of -- of budgetry (ph), and are you willing to sort of stand up to those on the right of you and the tea party, et cetera, and say, this is the best we can get, it's time to move on?

CORNYN: I agree with Mark this is small ball compared to the big issues of the debt. We're going to have to vote on whether to increase the debt limit or not. We've maxed out the federal government's credit card at $14 trillion.

And these are the big issues and we ought to be looking at everything. And I respect what Mark and others are trying to do on a bipartisan basis in the Senate. But it's not going to happen without the president of the United States. He basically has ignored his own fiscal commission report that came out in December 2010, entitled "Moment of Truth," which describes in sobering terms the challenges we face as a country. But it's not going to happen without the president engaging. And we'd like to do something significant with divided government in a bipartisan way.

CROWLEY: And, again, you all sound so -- you know, you sit down here and everybody I get here sounds really reasonable, and somehow you get up to Capitol Hill and it becomes toxic. And everybody says, no, it's your fault on left and it's your fault on the right, and the American people get I think angry at that.

So in the end, can you two, can enough Republicans and Democrats come together to, A, avoid a government shakedown -- or shutdown... (LAUGHTER)

CROWLEY: That too. Yes or no? And then when you get to the debt ceiling, which is the next one, can you get that -- can you move past that?

WARNER: Well, I hope the answer to the first is yes.

CROWLEY: But do you think it's yes?

WARNER: I think it will be yes. Because, again, what kind of message do we send to this world if we are saying, we've agreed on a top line budget number, in terms of what we're going to cut this year, but then we're going to have these extraneous factors come in that have nothing to do with budget, the so-called "policy riders," and that causes a shutdown.

I don't think American people will accept that. And, secondly, on the debt limit, it just frightens the heck out of me that anyone responsible would say, let's go ahead and light the fuse that might create the next economic meltdown.

Because with the markets as uncertain as they are, with the circumstances going on in Europe in terms of Greece and Ireland and Portugal, with the unrest in the Mideast, the notion that America would even potentially think about defaulting on its debt, and what that could do in terms of driving up interest rates, it would just be totally irresponsible.

You've got to believe cooler, saner heads will prevail on the debt limit as well.

CROWLEY: Let me just put a little explainer in here and then have you comment. And that is that this debt ceiling, if you all do not act to raise the debt ceiling, that is, the amount of money that Congress allows the U.S. to go into debt, it will cause us to default on things.

There is no way that this debt ceiling can be allowed not to -- let's see, let me put this positively. There is no way you can't pass this, right? You have to lift the debt ceiling. CORNYN: I intend to vote against the -- raising the debt ceiling unless we can get some systemic reforms, the kinds the president's own fiscal commission recommended in December of 2010. I think we need to pass a balanced budget amendment to the United States Constitution that 47 of my colleagues and I rolled out this last week.

I hope we can get bipartisan support. We came within one vote in 1997 of a balanced budget amendment to the Constitution which would force it the federal government to live within its means instead of spending money we don't have.

But that's the price that's going to have to be paid, systemic reforms, in order to get Republican support for raising the debt ceiling, otherwise I think you are going to see Democrats having to do that all by themselves.

CROWLEY: Up next, I want to talk to you all about how Republicans want to change Medicare and Medicaid. How Democrats want to change the tax code. Much more with our two senators.

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CROWLEY: We are back with Democratic Senator Mark Warner of Virginia and Republican Senator John Cornyn of Texas.

As I understand what Senator Cornyn was saying, the price for many Republicans of raising the debt ceiling so the U.S. can continue to borrow money to pay its bills, is a balanced budget amendment, that they want those two together. Is that OK with you?

WARNER: Listen, I was a governor. We had to balance our budgets. I don't think a federal balanced budget amendment gets us to where we need to be. I do agree that we need a long-term plan, but I would not tie it directly to the debt limit. Messing with the debt limit with the instability in the bond market at this point could create be -- could create a financial havoc and crisis.

CROWLEY: But to get their votes?

WARNER: What I think we need to put in place, though, is a plan that says how -- and basically working off the president's debt and deficit commission, how do we put up a five- to 10-year plan in place that will bring down our spending, that will reform our tax code, that will generate the revenues and the spending cuts we need to start chipping away at that $14 trillion debt.

Every day we fail that, we add $4 billion with a "B" to our national debt. So I agree that we need a plan, that's what we're working on that in the Senate on a bipartisan basis. Three Democrats, three Republicans.

CROWLEY: A gang of six working on debt reduction.

WARNER: Saying let's get -- yes, let's get out of this small ball box, and let's go ahead and take on these tough issues around defense spending, around entitlements, around tax reform. I think we're going to get that plan moved forward.

CROWLEY: What is the status of that? I mean, how -- because this has been going on for a while.

WARNER: This has been going on for a while. But, you know, it's -- these are huge issues. You see why they've not been bit off in the past. But I think we're working in good faith. I think we've made some progress in the last week. Chances are when we roll out our ideas, we'll get some grief from both the left and the right.

But if we don't find a way, as we started this conversation, to kind of link arms, Democrats and Republicans, and kind of take a giant leap together, then these questions around debt and deficit are going to continue to haunt us. It's not going to be a question of whether we do debt...

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CROWLEY: Will you see something that's...

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CROWLEY: ... for you guys?

WARNER: ... deficit reduction, it's only a question of when. I think you'll see something very shortly.

CROWLEY: This month?

WARNER: Very shortly.

CROWLEY: We have got a whole month. It sounds to me like you are quite willing for Democrats to go ahead and vote to lift the debt ceiling, which is necessary.

CROWLEY: But you, kind of -- you Republicans are going to stay away from it and let them do it and then take the heat in the election. That's what it sounds like to me.

CORNYN: Well, we can't continue business as usual here in Washington. And we need presidential leadership. Dick Durbin and Kent Conrad, part of the gang of six, were on the president's fiscal commission and agreed with his recommendations.

Really, what we're lacking is presidential leadership on this issue. You know, the irony, Candy, is if he were willing to work with us on a bipartisan basis to embrace some of the recommendations that Mark and the gang of six are going to make, or his own fiscal commission, I think it would actually help the president politically.

Instead, you see the president really, you know, MIA, and you see him planning his announcement for his re-election bid next week, and it's just, kind of, like, you know, where are your priorities?

And this has to be the nation's number one priority at this point, because the debt is a national security problem, as the chairman of the Joint Chiefs of Staff has said.

CROWLEY: Well, there are plenty of Republicans out there, too, we might add, for the presidential race.

But Congressman Paul Ryan has put out, or is about to put out a Republican plan for the 2012 budget, which is going to include some of these on entitlements, some of these things that you want the president to step out on.

It would be an overhaul of Medicare, which would give people subsidies to go buy private insurance -- so senior subsidies to go buy private insurance; about $1 trillion -- several trillion dollars' worth of cuts in Medicaid, giving them block grants, to states, rather than paying per person. Roll back spending to 2006; cut corporate tax rates but close loopholes; and make permanent the Bush tax cuts.

Starting point?

WARNER: I think, Candy, I'm anxious to see Congressman Ryan's plan. My understanding is he's going to do all of these things and not look at defense spending, not look at major tax reform that would actually raise revenues.

I don't know how you get there without taking basically a meat axe to those programs who protect the most vulnerable in the country. So I'll give anybody the benefit of a doubt until I get a chance to look at the details, but I think the only way you're going to really get there is if you put all of these things, including defense spending, including tax reform, as part of the overall package.

CROWLEY: Is there tax revenue that you would look at to say, yes, I think we can gain some more revenue by raising this tax?

CORNYN: You know, we can't raise taxes enough to close this deficit or pay off this debt.

CROWLEY: No, you can't, nor can you cut spending enough. Isn't that the point?

CORNYN: No, I think we can, but I agree with Mark that we need to look at everything on the table. But the reason why Congressman Ryan is leading with this budget proposal is because the president refuses to lead and so Republicans in the House are going to have to lead.

The political strategy is clear. Then Chuck Schumer and others are going to attack them for the proposals they've made, rather than to try to work in a constructive way like the gang of six is doing in the Senate. I just think it's -- it's a real shame and a lost opportunity.

CROWLEY: I'm going to give you 15 seconds to defend the president, because that's three times he's said he's not involved.

WARNER: We will not get there without the president. The president will be involved. But we've got to make sure that the House comes along as well. So I think we'll take the first set of arrows, but we will see the president very engaged in the debate.

CROWLEY: OK, soon -- coming soon.

Thank you so much, both of you. I appreciate it.

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